Rewards Credit Cards

Bankruptcy and Credit

Bankruptcy is a big thing and it should not be done lightly. For those who file and obtain a bankruptcy it stays on your credit for 10 years after your file date, and for the rest of your life for job applications. This should never be done lightly or carelessly. But if bankruptcy is needed it is not the end of the world and there are ways to help re-establish yourself as a good lender.

When reestablishing credit after bankruptcy be careful when using credit and be sure to pay all your lenders on time, every time. This is very important in establishing yourself as a responsible lender – especially after bankruptcy. One late bill can end up on your credit report so be sure to do it right all the time.

Also you need to be very careful with the spending of your money. Do not ever buy things knowing you may not be able to pay for them or have to sacrifice your bills in order to pay for them. It is very important that you use your credit wisely and responsibly all the time. Remember a bankruptcy should be avoided but it is not the end of your credit!

Using a Bad Credit Credit Card to Get Approval

Having a bad credit credit card is a way to get easy approval and in this way grabbing unto unsecured credit, although the first thing that one should do would be to solve the bad credit matters as such preventing more harms to be done to the credit score.

With so many bad credit credit card options available there is the possibility for these ones not to be wisely used or for the crediting companies to report delayed payments to the credit bureaus.

The following aspects should be taken into account by the consumers:

1 – Do you need that credit card so badly? Credit cards are indeed very helpful as the card holder won’t have to carry cash around and in this way the tracking of the expenses is also easier to be done. But if the applicant is more concerned to get an unsecured credit and not considering the aspect of convenient shopping, then there is the danger of getting more debt that one can already re-pay or get it re-paid in due time.

2 – How did you use the former credit card? In case you have made late payments on regular basis or didn’t pay the balance in full every month, it is more than likely to get a bad credit only for this sort of reason. To live above your own financial means generally leads to financial collapse and it is more than possible to get yourself into a larger hole whenever the interest rates and the fees accumulate each time.

3 – Is it possible for the credit card to rebuild the bad credit? Being wisely used in the trial of rebuilding credit consumers can take advantage from a credit card. The re-payment of the credit card charges is one of the largest credit report factors that matter in the credit score.

But not every credit card company make reports to major credit bureaus. Applicants should ask for a credit card that presents the report at least one of the following credit bureaus – Equifax, Trans Union, or Experian.

This is how you can maximize the credit reporting benefit:

- Use the credit card you have – creditors see an open line of credit as a potential debt, and as such more money to gain. In case you have, for example, $5,000 limit on your credit card and no charges on it, this card is seen as carrying a potential debt within the limits of that amount. You should close the accounts of credit cards that haven’t been reported as being late in payments to the credit bureau.

- Do not use the credit card just for the sake of avoiding paying with cash since this is on shortage. Utilize the card when you budget with cash for the expenses, such as it is with weekly grocery shopping, those funds being used in re-paying the charges.

4 – When looking for a bad credit credit card, just apply for that card that is possible to limit the potential for you to accumulate more debt. Do not rush into a $5,000 credit line, but rather a $2,000, as you would see that once having a bad credit you will be charged a higher interest rate with an increased credit line (this is because you are seen by the creditor as representing an increased risk to the business).

Missing a Payment on a Credit Card Debt – The Consequences

When someone is missing a payment on a credit card debt there are more consequences that one can be aware of. First of all these late payments are reflected in the credit report and as such in the credit score for later, and second it can incur some penalty fees setting by the lender. Missing a payment can automatically lead to a rise in the interest rate.

Another aspect that not too many credit card holders know is that you are being watched: the moment you have been seen that you are late for a credit card payment the other lender will instantly think of adjusting the interest rate and not in your own benefit, of course. This is not fair, but as long as you have checked the box with “I understand and agree with the terms”, then nothing else can be done.

This aspect can be seen when you will check all your cards; you will see that in case you were late with one card, all the other will have their interest rate increased meanwhile. The explanation lies in the fact that you are now seen as a risk to the other lenders and their own way to defend themselves is to apply this rise in your monthly rate.

The above situation can occur to the first time credit card borrower, to the seniors who live on their social security and this might happen to you, too.

The clear thing that you can do, is to stay away from these sorts of situations, and incase it happens that you have forgotten, you should immediately call the lender and with a little bit of luck your lender maybe won’t report it to the credit report bureau or it won’t be recorded as a late payment that attracts penalties or rising interest rates.

A lot of the things that are done by the credit card companies do not look too fair, but you need to keep in mind that these are in fact their money and according to law they are required to set their own rules and penalties when this money can not be gained back.

Most of the lending terms are written on the application form and it is your own duty to read them and understand them correctly to know what you will be dealing with in the future.

There can be sometimes cases when terms are not printed and as such you will need to get some clarifications. In this case you should call and get the specific answers to the questions that bother you. After all it will all depend on you and your needs to reach for more vigilant behavior when it comes to your financial status.

Ways to Eliminate the High Credit Card Rates

The following facts have started to become more and more familiar to all sorts of people, either they end up with having a good credit or not – they are given notice of the higher fees and interest rates that are applied on their credit cards. Paying attention to what you receive you would notice that bills are sent closer to the due dates.

In case the payment is late by a day this will automatically lead to higher interest rates that can go up to 29%. Regulations are all the time set to put the consumer on a protected level but till these ones will come into being, some other methods will be used with the purpose to get more fees from the consumer. Discussions are carried about charging fees from consumers who pay off their monthly balances.

What is there to do for a consumer in order to stop this practice? One has already adopted the idea to stop paying the bills saying that it is no point to pay on time the balances as long as her loyalty to the bank is not considered and as a result she launched a protest on You Tube.

Now this is a way to make a point as she wasn’t worried at all about recording a bad credit score for not continuing with paying the bills. She used the publicity to show her decision – once she is treated with no respect, then she will treat the bank with no respect as well.

Nevertheless, being a person who has a good credit, you shouldn’t go that far resorting to such a radical approach. There is a way to avoid all these onerous means adopted by your bank, and this way involves taking your business somewhere else. Just take a look at your local Credit Union and find out what services they offer through their partners.

Rates are present there as low as 9.99% to 14%. Why is that? Because Credit Unions are institutions that operate on non-profit basis and for the benefit of their members. Joining in you will automatically become a member. This financial institution can be supported as long as you move your business to an institution that acts in the interest of their members.

Other choice can be the community bank with which it is believed to have a good relationship. Just remember that the big institutions will never offer support as others do, therefore the use of other choice can open up to lot of variants; in fact you will very surprised to see how much money you can save once deciding to move your accounts with another institution.

Why Is No One Using Cash?

So many people do not carry cash anymore and many people wonder why.  Well there are a actually quite a few reasons to this question.

Cash Is Cumbersome
Cash is so cumbersome to handle.  You have to count out the bills and then carry the change.  Its so much easier just to take out a piece of plastic and swipe it at the machine and put it back in your wallet.

Security
Using a credit card is a lot safer then carrying around a couple of hundred dollars for credit card purchases.   If you get held up there is no way to cancel your cash and get it back.  If your credit card is stolen its as simple as calling a 1800 number to report it and if your late doing that many credit cards offer protection against thieves and will not require you to pay your thieves bills!

It Establishes Credit
Using a credit card is a form of lending and thus establishes credit.  If you use cash you are not doing anything to help your credit and can in fact be doing a lot to cause great harm to it!

Rewards
Cash does not offer spending rewards such as free gas, cashback or airline points like many credit cards do!

Will Credit Cards Cause Debt

Credit cards by themselves will not take you into debt if you are responsible about using them.  In fact proper and responsible usage of a credit card is a great tool to establish the good credit you need in life.  While using a credit card is lending money, you need to lend money in order to establish credit you just have to be sure to pay that money off in a timely basis!

You should also never try to pay off your current debt on a credit card.  This can actually in fact harm your credit score quite badly!  So you need to start earning some money and slowly pay off those bills over time.  Remember responsibility is the key to good credit and debt management.

Why I Should Use A Credit Card

So many people ask why they should use a credit card when many people say using cash is so much easier on the budget.   That’s a really good question, but to be honest the answer is actually quite simple.  In order to establish a credit score you need to use your credit.  If you’re paying just using cash you are not establishing credit of any sort when paying your bills, grocery shopping or filling up that gas tank.

So try to use a credit card a few times a month to pay for simple things like gas in the car, or grocery shopping or a movie rental.  Using $100 or so dollars a month of credit and quickly paying it off every month can do wonders to improve your credit score.  It shows that you’re are a responsible party, quickly pay off your debts and any lender will eager to lend you money!

Remember, your credit score does not affect just your loans.  It can affect your ability to find a job, lease an apartment, ability to get financial aid and so much more!  So be sure to try and keep that credit score up there!

What Credit Cards Will Approve Me?

If you are thinking about getting a credit card your credit score is going to have a major impact on your selection.  In order to get a credit card with a decent interest rate you’re going to have to have established some pretty good credit.   In order to get one of these low interest credit cards you should aim for a credit score of 650 or higher.

But remember if you have less credit you will likely be able to get a credit card but it will be at a much higher interest rate.  This is why managing your credit score is a very important thing.  If your credit score is really horrible you will likely find yourself unable to get yourself any more credit.

Remember when shopping around for credit cards find yourself one with the lowest interest rate possible.  This makes it much easier to make your payments and further improve your credit score even more!

Mistakes That Hurt Your Credit

People commonly make some really simple to avoid mistakes that really can hurt your credit score and to be honest these simple mistakes are quite easy to fix so you can avoid harming your credit score.

Paying Bills Late
Paying bills even a day late reflects on your credit score.  If you pay rent, utilities or a library fine late even one day it can and is often reported to a credit agency.  Make sure you pay your bills on time, or even look at setting up automatic payments!

Not Checking Your Credit Reports
Your credit report often contains mistakes which is why you should check it at least once a year.  These mistakes are often very simple to clear up with just a few phone calls or even a letter.  Be sure you get a credit report from the three major credit reporting companies: Equifax, Experian and TransUnion.

Using All Your Credit
Using all your credit means you have no credit left.  This means that companies will be less likely to loan to you!  Make sure you don’t over extend your available credit!

Use Credit Not Cash
When spending cash you are not giving lenders any information on how good you are at paying off your debts!  While spending cash is good on your budgeting it really is very harmful to your credit score.

Identity Theft

Identity theft is a very scary thing that can harm your credit for a very long time.  It’s when someone uses your private information such as your name, date of birth, social security number and other confidential items to open credit in your name with no intent of paying off that credit and then you get stuck with having to handle the debt.  This is why it is very important to combat identifying theft before it happens, and here are some very simple and quick ways to keep identity thieves at bay.

Shred, Shred, Shred!
When disposing of confidential documents such as bills, bank statements, check stubs or anything else with your name, address, social security number, date of birth, or any other information that identifies you make sure you shred them before placing them in the trash!  It also does not hurt to make sure businesses you work with do the same!

Stay Vigilant!
Closely monitor your credit score and make sure you do not fall for any phishing scams and accidentally give the identity thieves your information.  Also ask your financial institution to keep an eye out for unusual requests or transactions on your accounts!