News Credit

Lower Your Credit Card Interest Rate Now!

2007-05-28T03:37:00.001-07:00

Lower Your Credit Card Interest Rate Now!
With today's credit card companies, there are many opportunities to get your cards rate of 21% or more reduced. The higher the amount of interest your card charges will cost you more for a simple purchase and ultimately may take you years to pay off instead of months, should you make the minimum payment allowed. People often just pay the minimum balance as a way to improve their credit rating; this couldn't be a more dangerous way to increase your credit score. Leveraging the credit card company to say "Uncle" to your ability to switch over is easier than you think.
The switch over tactic
If your credit card interest rate is over 20% you should definitely seek relief in several ways. One of these ways is to let them know you are thinking of moving to a competitor's credit card because they are offering a lower rate. They will move promptly to earn your dollars and interest. Let them know how unsatisfied you are about their ability to reduce your percentage rate commensurate with your ability to pay your bill in a timely manner. They will probably put you on hold immediately and speak with a manager to get your rate reduced.
Don't be afraid to move to another credit card company
Some credit card companies will not budge when it comes to reducing your rate: even if you threaten to leave them. That is when you look for another credit card that meets your immediate financial needs. Shop around to the major credit card companies and seek out the best possible rates. You can also search on the Internet for sites that give the best credit card ratings. This will allow you to make a financial decision that can save you hundreds if not thousands in the long run.
There are a dozen reputable credit card companies in the market who are willing to sign you up to earn your interest. These cards will even offer to assume your previous credit card debt to help reduce the interest you are bearing on those accounts.

Negotiating Rates with Your Credit Card Company

2007-05-28T03:36:00.003-07:00

Negotiating Rates with Your Credit Card Company
Ok, let's face it, everybody hates high credit card rates, and they drain hard earned money out of your wallet. As a valued consumer, it is apparent that you learn how to negotiate to get the absolute best rate that you possibly can. The good news however is that it doesn't have to be a difficult or time-consuming process. In fact, it can be very easy indeed if you know what you're doing. In this article we will discuss the ins and outs of credit card negotiating to ensure that you get the best possible rate with the least amount of effort.
First and foremost, you should figure out if you even want to continue using your current credit card company ( http://www.the-credit-card-centre.co.uk/best-credit-cards.html ). Are you pleased with the overall service that you are receiving? Do you like their benefits? If the answer is yes then you can proceed. If not, you should stop reading this article and start looking for a better company.
Second, you should evaluate your paying history and make sure that it is positive before you call to negotiate. If it is positive then you have power and if it isn't then you'll be negotiating from a position of weakness and that might not be good. Instead, you should wait until it is more positive before you call them to negotiate rates.
Third, if you have a good history then remember this when you call. In essence, you'll have extremely high negotiating power. The company needs your business in order to be successful and with clients they lose big time. Therefore, you should always display this "take them or leave them attitude" while conducting your negotiations.
Draft up a script and memorize it. It can be as simple as "Hello, my name is Bill and I have been a cardholder for X years and I consistently pay my bills on a time. Well recently I have been receiving all types of credit card offers from XYZ bank indicating that I qualify for an extremely low interest rate of X and am considering leaving you and going there if you can't offer me a lower rate. Is this something that you can help me with?
Practice, practice and practice some more with your script until you are completely and totally used to it. Once you are, contact the company. Read your script and see what happens.
If you get a hard nose customer service representative then don't threaten her. Be agreeable and ask to speak to his/her supervisor. If that is not possible, be nice to her and try again she may have some leeway. If you like your present company, you can even try negotiating interest rates, annual and even those yucky late fees.
However, if you're fed up, have an alternative company in the wings, and your current company won't budge with their rates then be willing to take your business elsewhere. After all, you hold the power so don't be afraid to use it! They key however is to not bluff but to follow through with your threat. Close the account, ask for them to send you notification in the mail, cancel the credit card and use another card.
In conclusion, you can be successful with the negotiating process if you follow the above mentioned tips. If your current company is unwilling to cooperate then you should simply take your business elsewhere. You're better off with another credit card company that values your savvy negotiating skills!

How Creditors Measure Your Credit Rating

2007-05-28T03:36:00.001-07:00

How Creditors Measure Your Credit Rating
Creditors will measure your credit rating based on the following three main things.
Capacity
Collateral
Character
The three "C's" show creditors your:
"Capacity" or income to pay the debt
"Collateral" or assets to secure the obligation
"Character" shows your compliance to repay the debt
1. Capacity
The very first question is whether you have sufficient income to repay the debt. Creditors will definitely check to see if your income exceeds your expenses so that you ca comfortably pay the debt. A creditor will then want to know:
Your income - from all sources
Your fixed expenses
Your other debts
The amount remaining from your total net income, after deducting your fixed monthly expenses and other debts, is your capacity. If your net income is $3,000 a month and your total living expenses is $2,500, then your credit capacity is an amount that requires no more than $500 in monthly payments.
If you now pay $400 a month for other credit obligations, then your remaining capacity is a $100 a month, and a creditor should extend you that amount of credit.
There are three techniques that will allow you to maximize your income:
Increase your income
Decrease your expenses (easier to do than the first one)
Reduce your other debts
2. Collateral
A lender or creditor can be secured or unsecured. Secured lenders hold a lien against specific assets, such as real estate, an automobile, or boat. If you fail to pay, the secured lender can sell the pledged asset to recover debt owed. Secured lenders seldom loan more than the auction value of the collateral.
Secured credit, is an almost guaranteed way to rebuild your credit. Even with poor credit, a lender may advance your credit if you ca secure the credit with a lien against some valuable asset. Many creditors extend credit entirely on the strength of the pledged assets.
Other credit considerations are either ignored or carry comparatively little weight in the credit decision.
What can you use as a collateral to secure your debts and rebuild your credit? You may be appreciably wealthier than you think. Add the value of your various assets (property that you own) and subtract any existing mortgages or lies against those assets. The difference is your equity or net worth in the asset.
This is what you have available to secure a loan. Do not overlook any asset:
Home
Investment real estate
Stocks, bonds, mutual funds,
Automobile
Boats, planes, recreational vehicles
Notes and mortgages due you
Art, jewelry, antiques
Pensions, IRAs, and Keoghs
Royalty income
Income from trusts
You may have other assets to pledge. The point is that collateral gives you a borrowing power approximately equal to your equity in your assets. Regardless of your credit history, if you have collateral worth a solid $100,000, you should be able to borrow close to that amount.
3. Character
Creditors next consider your character. How important this is depends upon the type of credit, and who your creditors are. Asset based lenders rely chiefly on collateral, and they are less concerned with your character than are unsecured creditors who can only rely on your prior reliability for honoring your obligations.
When creditors check your character, they basically look at how you satisfied your past obligations. Meaning they want to know:
How many credit defaults have you had?
What was the reason for the defaults?
How recent are they?
Do you own your own home?
If you rent, for how long have you rented the same apartment or house?
Do you have a checking account?
Do you have a savings account with regular deposits?
Do you have a payroll savings plan at work?
Do you have a telephone in your own name?
Do you have a criminal record?
Have you filed bankruptcy?
Positive answers to these nine questions will often offset an otherwise negative credit report. Basically your credit character boils down to your credit history in the past. In the eyes of creditors, if your past credit character is good, there is no reason to believe why your future won't look promising.

How to Dispute Credit Report Errors

2007-05-28T03:35:00.001-07:00

How to Dispute Credit Report Errors
Your credit report--a type of consumer report--contains information about where you work and live and how you pay your bills. It also may show whether you've been sued or arrested or have filed for bankruptcy. Companies called consumer reporting agencies (CRAs) or credit bureaus compile and sell your credit report to businesses. Because businesses use this information to evaluate your applications for credit, insurance, employment, and other purposes allowed by the Fair Credit Reporting Act (FCRA), it's important that the information in your report is complete and accurate.
Some financial advisors suggest that you periodically review your credit report for inaccuracies or omissions. This could be especially important if you're considering making a major purchase, such as buying a home. Checking in advance on the accuracy of information in your credit file could speed the credit-granting process.
Getting Your Credit Report
If you've been denied credit, insurance, or employment because of information supplied by a CRA, the FCRA says the company you applied to must give you the CRA's name, address, and telephone number. If you contact the agency for a copy of your report within 60 days of receiving a denial notice, the report is free. In addition, you're entitled to one free copy of your report a year if you certify in writing that
(1) you're unemployed and plan to look for a job within 60 days,
(2) you're on welfare, or
(3) your report is inaccurate because of fraud. Otherwise, a CRA may charge you up to $9.00 for a copy of your report.
If you simply want a copy of your report, call the CRAs listed in the Yellow Pages under "credit" or "credit rating and reporting." Call each credit bureau listed since more than one agency may have a file on you, some with different information. The three major national credit bureaus are:
Equifax, P.O. Box 740241, Atlanta, GA 30374-0241; (800) 685-1111.
Experian P.O. Box 2002, Allen, TX 75013; (888) EXPERIAN (397-3742).
Trans Union, P.O. Box 1000, Chester, PA 19022; (800) 916-8800.
Correcting Errors
Under the FCRA, both the CRA and the organization that provided the information to the CRA, such as a bank or credit card company, have responsibilities for correcting inaccurate or incomplete information in your report. To protect all your rights under the law, contact both the CRA and the information provider.
First, tell the CRA in writing what information you believe is inaccurate. Include copies (NOT originals) of documents that support your position. In addition to providing your complete name and address, your letter should clearly identify each item in your report you dispute, state the facts and explain why you dispute the information, and request deletion or correction. You may want to enclose a copy of your report with the items in question circled. Your letter may look something like the sample below. Send your letter by certified mail, return receipt requested, so you can document what the CRA received. Keep copies of your dispute letter and enclosures.
CRAs must reinvestigate the items in question--usually within 30 days--unless they consider your dispute frivolous. They also must forward all relevant data you provide about the dispute to the information provider. After the information provider receives notice of a dispute from the CRA, it must investigate, review all relevant information provided by the CRA, and report the results to the CRA. If the information provider finds the disputed information to be inaccurate, it must notify all nationwide CRAs so they can correct this information in your file. l Disputed information that cannot be verified must be deleted from your file.
If your report contains erroneous information, the CRA must correct it.
If an item is incomplete, the CRA must complete it. For example, if your file showed that you were late making payments, but failed to show that you were no longer delinquent, the CRA must show that you're current.
If your file shows an account that belongs only to another person, the CRA must delete it.
When the reinvestigation is complete, the CRA must give you the written results and a free copy of your report if the dispute results in a change. If an item is changed or removed, the CRA cannot put the disputed information back in your file unless the information provider verifies its accuracy and completeness, and the CRA gives you a written notice that includes the name, address, and phone number of the provider.
Also, if you request, the CRA must send notices of corrections to anyone who received your report in the past six months. Job applicants can have a corrected copy of their report sent to anyone who received a copy during the past two years for employment purposes. If a reinvestigation does not resolve your dispute, ask the CRA to include your statement of the dispute in your file and in future reports.
Second, in addition to writing to the CRA, tell the creditor or other information provider in writing that you dispute an item. Again, include copies (NOT originals) of documents that support your position. Many providers specify an address for disputes. If the provider then reports the item to any CRA, it must include a notice of your dispute. In addition, if you are correct-that is, if the disputed information is not accurate-the information provider may not use it again. Accurate Negative Information When negative information in your report is accurate, only the passage of time can assure its removal. Accurate negative information can generally stay on your report for 7 years. There are certain exceptions:
Information about criminal convictions may be reported without any time limitation.
Bankruptcy information may be reported for 10 years.
Credit information reported in response to an application for a job with a salary of more than $75,000 has no time limit.
Credit information reported because of an application for more than $150,000 worth of credit or life insurance has no time limit.
Information about a lawsuit or an unpaid judgment against you can be reported for seven years or until the statute of limitations runs out, whichever is longer. Criminal convictions can be reported without any time limit.
Adding Accounts to Your File
Your credit file may not reflect all your credit accounts. Although most national department store and all-purpose bank credit card accounts will be included in your file, not all creditors supply information to CRAs: Some travel, entertainment, gasoline card companies, local retailers, and credit unions are among those creditors that don't. If you've been told you were denied credit because of an "insufficient credit file" or "no credit file" and you have accounts with creditors that don't appear in your credit file, ask the CRA to add this information to future reports. Although they are not required to do so, many CRAs will add verifiable accounts for a fee. You should, however, understand that if these creditors do not report to the CRA on a regular basis, these added items will not be updated in your file.
Sample Dispute Letter
Date
Your Name
Your Address
Your City, State, Zip Code
Complaint Department
Name of Credit Reporting Agency
Address
City, State, Zip Code
Dear Sir or Madam:
I am writing to dispute the following information in my file. The items I dispute are also encircled on the attached copy of the report I received. (Identify item(s) disputed by name of source, such as creditors or tax court, and identify type of item, such as credit account, judgment, etc.)
This item is (inaccurate or incomplete) because (describe what is inaccurate or incomplete and why). I am requesting that the item be deleted (or request another specific change) to correct the information.
Enclosed are copies of (use this sentence if applicable and describe any enclosed documentation, such as payment records, court documents) supporting my position. Please reinvestigate this (these) matter(s) and (delete or correct) the disputed item(s) as soon as possible.
Sincerely,
Your name
Enclosures: (List what you are enclosing)

Can You Acquire Good Credit Overnight? You Bet

2007-05-28T03:34:00.001-07:00

Can You Acquire Good Credit Overnight? You Bet
Your credit file may not reflect all your credit accounts. Although most national department store and all-purpose bank credit card accounts will be included in your file, not all creditors supply information to credit bureaus : Some travel, entertainment, gasoline card companies, local retailers, and credit unions are among those creditors that don't.
If you've been told that you were denied credit because of an "insufficient credit file" or "no credit file" and you have accounts with creditors that don't appear in your credit file, ask the credit reporting agency to add this information to future reports.
Although they are not required to do so, many credit bureaus will add verifiable accounts for a fee. However, understand that if these creditors do not report to the credit bureau on a regular basis, the added items will not be updated in your file.

Beware of Bogus Credit Repair Companies!

2007-05-28T03:31:00.001-07:00

Beware of Bogus Credit Repair Companies!
So-called "credit repair" companies claim they can remove negative information from credit reports. Advertising as "Credit Advisors," "Credit Rating Correction Services" or "Credit Consultants," they trumpet variations on this message: "Turned down because of bad credit? We can help!" Many of these companies charge hundreds if not thousands of dollars for the promise to "clean up" bad credit reports. But the truth is, these companies can only do what you could do yourself--at no charge.
Nobody can remove negative information that is accurate from your credit report. No company has a "secret" ability to remove all negative information.
But this doesn't stop their claims. This deceptive quote is from a credit repair company brochure: "Charged-off accounts, collection accounts, judgments, tax liens, repossessions, and even bankruptcies can be removed from your credit records in less than one year (five to seven month average)."
One tactic is to bombard credit reporting agencies with requests to verify information. If a credit reporting agency cannot verify an entry within 60 days, it will remove the information from the report. But if the information is later verified to be accurate, it will go back in the report.
Before you even consider signing a contract with a company that promises to repair your credit, remember these facts:
You may obtain a copy of your credit report on your own.
You have the right to dispute entries in your credit report.
Beware guaranteed credit offers!
Credit repair and other companies often claim they "guarantee" to get you a credit card, regardless of your credit history. In fact, these companies do not always honor their guarantee. Sometimes, they'll just take your money and run--you will not get any credit, regardless of what they promised.
If they get you a card at all it often will be a "secured" bank credit card, with high up-front "application" fees, that requires you to deposit and keep several hundred dollars in a savings account, or a card that only allows you to buy items in a catalogue from a business that you probably never heard of. (You can apply for a secured credit card by yourself. For a free list of banks that do not charge application fees for secured cards, see the information from Consumer Action in the "For More Information" section below.)
Credit repair companies often advertise on television, in newspapers and even on matchbooks. Sometimes they require consumers to dial a "900" telephone number to get more information. Calls to 900 numbers can cost $2 or $3 a minute, so listening to a few minutes of information about the cards can be expensive.
Some companies try to get people a credit card by having them apply using financial information of other people with good credit histories. It is a criminal act to apply for credit under someone else's name--do not do business with one of these companies.
Law enforcement agencies have shut down many credit repair outfits, but it is hard to stop a fraudulent credit repair outfit unless people complain about it. Therefore, be careful about responding to credit repair ads and be sure to complain to the agencies listed below if you think a credit repair company took advantage of you.
For more information
The Federal Trade Commission (FTC) publishes information for consumers on the subject of credit and enforces federal laws on credit. For a list of free publications, write to the FTC's Public Reference Department at the address given below. While the FTC does not handle individual cases, it can act when it sees a pattern of possible law violations develop. Complaints about credit reporting agencies and credit repair scams must be in writing. Send them to: FTC Credit Practices Division, 6th St., N.W., Washington, DC 20580.
Contact your local consumer protection agency or your state Attorney General's office. Many Attorneys General have toll-free consumer hotlines. These numbers may be listed in the "self-help" or government sections in the front of your phone book. These agencies can offer you advice and may also be able to help resolve your complaint.
Consumer Action's free complaint/information switchboards offering non-legal consumer advice and referrals can be reached from 10 a.m. to 2 p.m. on weekdays. Chinese, English and Spanish are spoken. Call either (415) 777-9635 (San Francisco office) or (213) 624-8327 (Los Angeles office). Consumer Action has a free list of secured credit card banks that do not charge application fees. To receive a free copy, send a self-addressed stamped envelope to: Consumer Action Secured Credit Card Survey, 717 Market St., Suite 310, San Francisco, CA 94103. (Available in English only.)
The Consumer Credit Counseling Service (CCCS) assists consumers who have problems in paying their bills--before their good credit ratings suffer. Your local CCCS office can help you work out flexible payment plans to make debt repayment more feasible. Call (800) 388-CCCS for an interactive recording that will provide you with the phone number of the office nearest to you. Spanish-speakers can call (800) 68-AYUDA (800-682-9832) between 8 a.m. and 7 p.m. central time.
Before you sign a contract with any company, check it out with the local Better Business Bureau (BBB), a non-government service which advises consumers on fraud prevention. Call your local BBB. If you cannot find a local number listed in the phone directory, call the Council of Better Business Bureaus at (703) 276-0100 for a referral to the office nearest you.

SuperCharged Secret 2, Credit Card Utopia

2007-05-28T03:30:00.001-07:00

SuperCharged Secret 2, Credit Card Utopia
INTEREST BEWARE, THERE'S SAFETY IN NUMBERS!
Note: The following is part 2 of a 5 part series, Over the course of these 5 articles, I am going to introduce you to several methods for maximizing the use and benefits of the best Credit Cards and offers on the market today. This information, when used in conjunction with one another, is unlike anything you've ever seen before. I like to call this approach, the "5 SuperCharged Secrets to Credit Card Utopia."
SECRET 1: I AM THE CONSUMER. AND I HAVE LOW-RATE SUPER-POWERS!
SECRET 2: INTEREST BEWARE, THERE'S SAFETY IN NUMBERS!
SECRET 3: TURBO-CHARGED KILLER RATE SAVING INFORMATION!
SECRET 4: YOU SCRATCH MY BACK, AND I'LL BUY SOME MORE BEER!
SECRET 5: LIVING IN CREDIT CARD UTOPIA
Without further Ado, let's continue with Secret #2:
SECRET 2: INTEREST BEWARE, THERE'S SAFETY IN NUMBERS!
1) This secret method isn't for everyone.
I would venture to say that this turbo-charged low rate secret is really for those with reasonably good credit.
But with that said, you may have good ENOUGH credit, and it doesn't hurt to TRY. If you don't succeed, then you've been blessed with the one thing most people don't have, and that's a GOAL?
You know what you want, better credit, and there are TONS of resources out there to help you get from point A to point B, much faster then you can imagine.
When you get there, this method is for you for sure! Work towards this! It's worth it.
2) If you have pretty good credit, it's time to use it to your MAXIMUM ADVANTAGE.
Do you like to shop at Costcoฎ? I do. I LOVE shopping at Costcoฎ. I know it costs me a membership fee every year, but I save money like CRAZY!
Why? Because Costcoฎ can buy in bulk, and get huge deals from their merchants.
You see, there's safety in numbers. Costcoฎ Members enjoy the benefit of pooling together their buying power, and extracting huge savings from vendors and suppliers.
3) And here we go! Secret #2 revealed: Take that concept, and apply it to Credit Cards! Interest Rates beware, because there's safety in numbers!
I'm talking about the big BLUE! I'm talking about American Expressฎ.
Now, most of us who have not yet climbed on board to AMEXฎ are comfy with having a Visaฎ/MasterCardฎ in our wallets. I know. I was one of you at one time. You think it's better, because Visaฎ/MasterCardฎ are more widely accepted. Right?
I'll grant you that in some smaller "ma/pa" operations, you may not be able to swipe your BLUE. But other than that, AMEXฎ is widely, widely accepted everywhere?Worldwide.
4) Go check it out for yourself.
AMEXฎ is generally available at all nationwide chains like department stores, grocery stores, restaurants, and many, many other fine establishments. My wife and I spend money, just like you do. We use AMEXฎ as much as we can, and we don't have a problem with the ability to swipe it virtually everywhere.
5) I believe, firmly, American Expressฎ is using the concept of pooled membership, to give you KILLER interest Rates, and amazing perks too.
I believe that the benefit of this pooled power is passed on to you, as a member of American Expressฎ.
How do I know this? Because I'm a member, and I can attest that the interest rates are low, low, low!
For example, as of today's date, my American Expressฎ Blue (no annual fee, by the way) is carrying a 9% interest rate (I also get balance transfer checks all the time?See Secret 1.)
6) Are there lower rates out there?
Well, maybe. But, I don't care. I like the fact that I don't have to go shopping for a low rate. I just KNOW that American Expressฎ IS the lowest, if not one of the lowest.
It's just so much less work for me as a consumer, to be a member of AMEXฎ. No more shopping around.
7) Go with the Credit Card Company that takes care of the CONSUMER FIRST! .
I don't mean to sound like a commercial. I also have a Citibankฎ, and other fine credit cards in my wallet, and our website provides information on ALL major credit card companies, not just AMEXฎ, so I have no vested interest in one over another.
But the secret knowledge here is that American Expressฎ seems to have the BUYING POWER to consistently give consumers some of the lowest interest rates on the market, and that's what makes them the BEST.
8) Check it out for yourself. Do your own research.
Don't rely solely on this writer's testimony. Go look around. Compare all the benefits, and the rates, and the rewards programs, and you'll see. AMEXฎ has no competition. Not for the consumer, anyway.
And in Credit Card Utopia, we always go with the best. As powerful consumers, we come first. We NEVER settle for less.
We've enjoyed providing this information to you, and we wish you the best of luck in your pursuits. Remember to always seek out good advice from those you trust, and never turn your back on your own common sense.
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Disclaimer: Statements and opinions expressed in the articles, reviews and other materials herein are those of the authors. While every care has been taken in the compilation of this information and every attempt made to present up-to-date and accurate information, we cannot guarantee that inaccuracies will not occur. The author will not be held responsible for any claim, loss, damage or inconvenience caused as a result of any information within these pages or any information accessed through this site.
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SuperCharged Secret 3, Credit Card Utopia

2007-05-28T03:21:00.001-07:00

SuperCharged Secret 3, Credit Card Utopia
TURBO-CHARGED KILLER RATE SAVING INFORMATION!
Let's just take a brief moment to recap:
If you've been following along on this journey with me, learning the 5 Super-Charged secrets to Credit Card Utopia, then you now know 2 very important things:
You now know how to take advantage of zero to low interest credit card offers.
You now know that there is safety in numbers, and you know the magic "Who's Who" of the major credit card companies. You know that one of them, in my opinion, stands out for consumers.
With me? Good. These are both essential foundations that you need to follow in order to live in Credit-Card Utopia.
Now, let me flavor it up for you.
What could be better than zero interest credit cards? What could be better than having the best, lowest, guaranteed credit card in your wallet?
1) How about cash? Would that work for you?
How about a big fat check at the end of the year, in the thousands and thousands and thousands of dollars?
Would you like to get PAID thousands of dollars each year, just for spending money that you ALREADY SPEND?
You might realize that I'm not talking DIRECTLY about interest rates. But listen, I can't get much lower then zero interest. I need you to think creatively with me now.
2) Rewards Cards, otherwise known as incentive-based credit cards. Let's start there.
These are no secret. Many of us have rewards cards. I have several, in fact, and I get many rewards for spending with them. I get airline miles, and I get gas vouchers, and I get discounts at online stores?AND?I get Cash.
But let me talk about a HUGE secret that most people are not yet fully exploiting for their personal and financial gain.
3) My family and I are just now getting into making money with Cash-Back offers:
Cash rebates, Cash-Back cards, those are the ones I want to focus on with you here, for a second.
How do these cash-back cards lower your interest rate? Well, at this stage, it's a semantics game, but if you have 9% interest for example, and you use a cash-back credit card that pays you 3% on all transactions?Well, that's like getting a 3% discount on the rate, so your charge is more along the lines of 6%. It's not EXACTLY like that, but you get the point.
More importantly, let's dig deeper.
4) I'm going to tell you how to TURBO-CHARGE this mechanism, and EXPLOIT IT FOR EVERYTHING it's WORTH.
You see, your credit card company wants you to spend as much money as possible with their plastic.
Yes, they'd like to charge you interest on debt. But even if you pay it off every month, did you know that they still make a profit on the transaction from the Merchant fees?
Yes, the credit card charges the merchant a fee for swiping your card. It can range anywhere from 1% to as high as 6%...
It does not impact you the consumer (directly), but it does give you some insight into why you can become business partners with your credit card company.
5) Secret # 3 revealed: Here's what my family and I are doing:
We use our cash-back credit card for EVERYTHING.
We simply have restructured our spending so that all expenses, or almost all expenses, go through our cash-back credit card.
Grocery stores, restaurants, shopping, dining, gas?Everything. In fact, as of the writing of this article, American Expressฎ has developed a Bill-Pay type system so we are able to actually pay some of our bills using our cash-back credit card.
Can you imagine? A credit card company developing online bill-pay. Now, how SMART is that?
6) Let me ask you something. How much money do you spend every year on expenses?
Don't get your calculator out, because the answer is simple. You basically, spend?.AS MUCH AS YOU MAKE?
The vast majority of us do. So, let me ask you the same question a different way: How much money do you make?
How much is 3% to 5% of that?
I'll give you an example. If the average household income (and expenses) were around $50,000, then that means a savvy consumer, with a cash-back credit card, could generate a check every year of between $1500 and $2500.
7) Holly Cape Canaveral, Batman!!! That's $2500 free cash dollars, every single year!
What would YOU do with all that free money? Buy a vacation, a new TV, some jewelry?
Are you getting it, now?
You must start looking at the Cash-Back credit card as more then just an incentive or reward.
Frankly, it is a new source of income.
8) Now, here's the nitty-gritty on how we do this. It's simple.
The first step, is we gathered all our credit cards, put them in an envelope, and put that envelope in our lockbox in the attic. We replaced all our plastic in our wallet with the cash-back credit card of choice. We also put an emergency debit card in our wallet, but the primary method now for spending, is to use the cash-back card. This takes care of gas, food, restaurants, etc.
The second step, is the process of restructuring expenses through the online bill-pay system with our cash-back credit card company.
We re-route as many expenses as possible through our cash-back card. It takes a little time, and doesn't happen in one day.
But do the legwork. Be a smart consumer like my family and I.
9) There's a perk, too!
The perk is outstanding! Have you considered, that my family and I only really have one payment a month to make? That's the goal we're moving towards anyway.
So, think about how many bills you pay each month. Wouldn't it be nice to just make one payment out for all your expenses, rather then a check to the gas-card, a check to the utilities, a check to the Credit Card Company, etc.?
Think of the convenience and time saved, to just make one payment out each month.
10) A lot of information to take in, yes? Let's pause here:
If you've followed my train of thought, then you've come to the Secret knowledge of how to extract and exploit the power of these cash-back cards for everything they are worth. If you do this, even just the first part, you will take a money saving incentive program, and turbo-charge it into an actual income producing technology!
Pretty, cool, huh? SHHH! It's a Utopian secret.
We've enjoyed providing this information to you, and we wish you the best of luck in your pursuits. Remember to always seek out good advice from those you trust, and never turn your back on your own common sense.
Publisher's Directions: This article may be freely distributed so long as the copyright, author's information, disclaimer, and an active link (where possible) are included.
Disclaimer: Statements and opinions expressed in the articles, reviews and other materials herein are those of the authors. While every care has been taken in the compilation of this information and every attempt made to present up-to-date and accurate information, we cannot guarantee that inaccuracies will not occur. The author will not be held responsible for any claim, loss, damage or inconvenience caused as a result of any information within these pages or any information accessed through this site.

SuperCharged Secret 4, Credit Card Utopia

2007-05-28T03:20:00.003-07:00

SuperCharged Secret 4, Credit Card Utopia
YOU SCRATCH MY BACK, AND I'LL BUY SOME MORE BEER!
Let's just take a brief moment to recap:
If you've been following along on this journey with me, learning the 5 Super-Charged secrets to Credit Card Utopia, then you now know 3 very important things:
You now know how to take advantage of zero to low interest credit card offers.
You now know that there is safety in numbers, and you know the magic "Who's Who" of the major credit card companies. You know that one of them, in my opinion, stands out for consumers.
You now know how to take a low interest credit card with a rewards program, and convert it into a money making technology that could seriously improve your financial house.
With me? Good. These are all essential foundations that you need to follow in order to live in Credit-Card Utopia with me.
In fact, you would think that there's not much more that can be done.
Side note: I hope you are realizing the power of this information.
It may seem simple, but are you doing it? No. So, be smart. Study this information, reflect on these insights, and move forward with them so you can truly benefit from this secret knowledge.
On to Secret, #4:
1) It's very important that Utopians cover all bases, and leave no one behind.
The 3 secrets we've covered, really deal with those of us who have fairly good credit.
Now, if you don't have "good" credit, please don't discard these prior ideas.
I didn't have "good credit" once. Who cares? How many people, small businesses, corporations, and large industrial countries, have said the exact same thing?
2) So, don't feel left out.
Move towards Credit Card Utopia as a goal to move you into action.
Our website (and many other fine websites around the internet) can provide you with many, many resources to work on your debt issues, or your credit score issues, or whatever.
You might be surprised how FAST you can go from point A to point B.
(Here's a tip: Don't waste time. Find assistance. Don't go at it alone.)
3) Getting back on track: Want a zero interest credit offer? Want a low-interest, no annual fee, incentive-based offer?
Well, if you're struggling with credit or debt, then the first step is to tackle this issue from a different point of view.
Give up on Visaฎ, MasterCardฎ, and AMEXฎ?At least the "unsecured" kind, and at least for now.
There's nothing wrong with applying, and trying, but if you've been turned down, there are other ways to go.
4) Secret #4, revealed in an analogy:
Do you live in a small town? If you do, you might have a small-town pub. Does everybody know your name? Does the bartender know you, and know the drink you like? Do you go into your pub after work, and down a stiff one, after a long day of working in the coal mines? Maybe it isn't payday yet. Do you think the bartender cares? Of course not! He wants you coming in so he can move his inventory of fine beers and spirits. He knows you. So, what does he do? Let's say this is the 1800s, and there's no such thing as "credit cards" amongst our meager coal-working small town clan. What does he do?
Right! He runs you a tab.
No interest rates, no worries, no big deal. He runs a tab. Why? Because he knows you're good for it, and he's moving inventory. He doesn't care about the interest, because he's making a profit off the sale of his beer. He knows where you live, and he knows you'll pay him back in a few days when you come in for a drink after you get paid. It's a virtual certainty.
Now YOU, the small-town beer drinking coal worker, you're perfectly fine with this. The drink costs you the same whether you had cash now or later, and the bartender runs you a tab, in exchange for selling you more inventory. Everyone works together.
You scratch my back, and I'll buy some more beer.
5) This concept of free "credit" provided to purchase inventory, is not a new concept.
As you can see, it's been around for a long, long time. However, in modern times, it has tremendous application for folks with "poor" credit issues.
The secret is that you buy merchandise (On stuff you already need, or are already buying) almost exclusively from merchants willing to give you credit at low to no interest.
So, while you think you are in a tough position with credit issues, you actually turn it around, and allow it to become consumer buying power.
Only shop with merchants that scratch your back.
With me?
6) Now, where do you find these merchants?
Well, in the real brick and mortar world, it's not that hard.
You can start with department stores, gas cards, furniture outlets, electronics stores, jewelers, and a variety of other stores that you may do business with.
I can't guarantee, of course, that they'll approve you. But many of these merchants run their credit departments in-house, and like our bartender, they're interested in moving inventory.
So, I wouldn't take one "no" to mean that everyone will say "no". Not true.
Many of the larger corporate chains do not offer low to no interest rates. But almost ALL of them offer huge discounts on initial purchases as incentives to get started.
As of the writing of this article, for example, JCPenneyฎ and Targetฎ both offer 10% discounts on "new accounts". In addition, most of them do offer zero interest when balances are paid off each month, and some of them offer different plans to meet different customer's credit situations.
Also, look to no-interest incentive specials that are going on for many larger-ticket items. Televisions, Furniture, etc.
You'll also find many deferred-payment incentives that you can use to your advantage, or that you can utilize as a no-interest situation.
You just have to shop around. They are out there.
7) Now, what about cyber-space? Is there a place to take advantage of this back-scratching secret in Silicon? Actually, YES! There is. Check this out:
Many shopping portals online have realized the advantage of working with "poor" credit customers, and tailor-making a shopping experience that fits these specialized needs. We've listed several at our website, but of course, you can find them at any search-engine or at other reputable websites around the internet.
In a nutshell, the shopping website offers a membership card for making purchases on credit. You go to the online mall, make your purchases for things you would already buy anyway, and build or rebuild your credit score. The shopping portal helps you out by reporting your credit activity to the major credit reporting bureaus, which in turn, improves your credit history.
In addition, the membership benefits often times include such things as travel discounts, rental car discounts, and FREE credit reports.
They almost always advertise guaranteed credit lines of up to $7500, and incentives for joining can include free merchandise (such as a free DVD player), or a merchandise voucher.
Look for 30 day money-back guarantees, and look for no annual fees, and yes, look for "NO INTEREST" on the credit.
Most of these sites will require an upfront membership fee, but then they immediately turn around and provide a merchandise voucher. For example, one portal charges $150 for the upfront membership fee, but then immediately provides a voucher of $200 for merchandise at their site.
Because their customers generally have a history of poor credit, they do sometimes require an initial payment, or "down payment" on purchases until a relationship is established, but hey listen. So what? If you have credit issues, then you have to start rebuilding credit relationships somewhere. It sure beats Layaway!
What a creative way to solve this problem. Everybody wins.
You scratch my back, and I'll buy some more beer!
Meanwhile, you're moving closer and closer to the pearly gates of Credit Card Utopia!
We've enjoyed providing this information to you, and we wish you the best of luck in your pursuits. Remember to always seek out good advice from those you trust, and never turn your back on your own common sense.
Publisher's Directions:
This article may be freely distributed so long as the copyright, author's information, disclaimer, and an active link (where possible) are included.
Disclaimer: Statements and opinions expressed in the articles, reviews and other materials herein are those of the authors. While every care has been taken in the compilation of this information and every attempt made to present up-to-date and accurate information, we cannot guarantee that inaccuracies will not occur. The author will not be held responsible for any claim, loss, damage or inconvenience caused as a result of any information within these pages or any information accessed through this site.

SuperCharged Secret 5, Credit Card Utopia

2007-05-28T03:20:00.001-07:00

SuperCharged Secret 5, Credit Card Utopia
LIVING IN CREDIT CARD UTOPIA
Let's just take a brief moment to recap:
If you've been following along on this journey with me, learning the 5 Super-Charged secrets to Credit Card Utopia, then you now know 4 very important things:
You now know how to take advantage of zero to low interest credit card offers.
You now know that there is safety in numbers, and you know the magic "Who's Who" of the major credit card companies. You know that one of them, in my opinion, stands out for consumers.
You now know how to take a low interest credit card with a rewards program, and convert it into a money making technology that could seriously improve your financial house.
You now know how to work with merchants to harness your consumer buying power, even if you have bad credit, so that you can get low interest, incentives, and discounts through buying on credit.
With me? Good. These are all essential foundations that you need to follow in order to live in Credit-Card Utopia with me.
And NOW?On to the FINAL, most important, MOST significant secret that I have to reveal?
Secret # 5 revealed: Living in Credit Card Utopia:
1) I live in a world where there is no such thing as interest rates. There is zero interest, zero annual fees, membership benefits, and perks.
What world do you live in?
2) I live in a world where consumers are the ones in the drivers' seat. We are powerful, powerful creatures, us buying-spending-consuming maniacs. We have the power to make our own choices about how to wield this mighty sword.
Are YOU a powerful creature?
3) I live in a world where plastic is a money-making technology. I don't live for plastic, and plastic does not own me. I am my own person, beholden to no one. But, plastic and I?We're business partners. At the end of the year, plastic sends me a big fat check for thousands and thousands of dollars, and I take my family on a KILLER vacation.
Are you in business with plastic?
4) I live in a world where nothing is impossible. Life presents obstacles, and I overcome them. NO BIG DEAL?So, while you may not be able to get into the pearly gates of Credit Card Utopia right now?.Enjoy sitting on the front porch, bartering with merchants, while you get your ducks lined up in a row.
Are you lining up your ducks?
5) I live in a world of goals, objectives, action plans, deadlines, and in Credit Card Utopia, good things don't come to those who wait?Good things come to those who take ACTION, and move towards their goals.
Do you take action?
Do you have goals?
Are you working towards improving your life?
LIVING IN CREDIT CARD UTOPIA
In Credit Card Utopia, I am totally, totally satisfied. I am at peace with my credit cards, and they love me. We are the elite few. We are the ones that enjoy low interest rates, cash-back at the end of the year, and perks, perks, perks.
And I want you here with me. There is no limit to how many of you can join me, in Credit Card Utopia?There is no population growth control, no capacity restrictions, no ceilings.
This is Credit Card Utopia. All are welcome here.
So, open your mind.
Open your creative mind, and look at your life as a template for change.
Look in every corner and every crevice, and start clearing away the cobwebs and dust-balls of your structured thinking. Find answers. Find solutions. Don't limit yourself.
Stop thinking like a box, and start thinking like a winding, swirling, ever-changing thread of energy.
Living in Credit Card Utopia, is not about following steps 1 through 5 (although I gladly provide you with mine).
Living in Credit Card Utopia, is about following strange journeys carved out by mysterious neurons in your brain, to solve problems.
I've given you 5 creative ways to tackle plastic. But, for my 5 super Turbo-Charged secrets, there must be thousands, thousands more.
Living in Credit Card Utopia, is about looking at your obstacles, and converting them to opportunities.
Living in Credit Card Utopia, is about taking all your assets, and maximizing them to your highest advantage.
Living in Credit Card Utopia, is EASY?If you just open your mind to the freedom of possibilities.
The only restriction you have, the only thing that prevents you from coming up here with me, the only thing that is getting in your way?.Is You?.
WAIT A SECOND, WAIT A SECOND!!!! STOP!!!
So what IS secret #5, Tom? I'm confused. What are you saying? What is this secret, "LIVING IN CREDIT CARD UTOPIA?" Spell it out for me. I don't get it?It all sounds really esoteric, and mumbo-jumbo-ish... Come down from la-la land, and tell it to us in plain, simple talk.
I hear you cry.
Let me rephrase,
Let me put it another way,
Let me finally throw all my cards on the table...
If you want to "BE" Like me,
And all us Utopians up here?.
Then you need to LIVE?
More?
Like a Utopian.
Still unclear? You know, there's one person that can explain it better than I?Go ask your 5 year old daughter.
She understands. It's the way she is learning, to be just like you.
That's secret #5, and it truly is the most important one.
Welcome to Credit Card Utopia.
We've enjoyed providing this information to you, and we wish you the best of luck in your pursuits. Remember to always seek out good advice from those you trust, and never turn your back on your own common sense.
Publisher's Directions:
This article may be freely distributed so long as the copyright, author's information, disclaimer, and an active link (where possible) are included.
Disclaimer: Statements and opinions expressed in the articles, reviews and other materials herein are those of the authors. While every care has been taken in the compilation of this information and every attempt made to present up-to-date and accurate information, we cannot guarantee that inaccuracies will not occur. The author will not be held responsible for any claim, loss, damage or inconvenience caused as a result of any information within these pages or any information accessed through this site.

5 Killer Steps to avoid Credit Card SCAMS!

2007-05-28T03:19:00.003-07:00

5 Killer Steps to avoid Credit Card SCAMS!
In August, 2004, the Federal Trade Commission issued their findings of a recent study, which showed that nearly 25 million adults were victims of fraud.
Now, most importantly, If you are a victim of fraud, please do not feel like you did anything wrong. It happens to all of us at one point or another, as the FTC's study clearly shows. Everyone likes a magic trick, and none of us are fully capable of noticing the con-artists' slight of hand. So, if you're a victim, take a deep breath. You're normal.
But, there's an old saying that goes something like this: Fool me once, shame on you?Fool me twice, shame on me!"
Here are 5 KILLER STEPS to protect yourself from Credit Card SCAMS!
NATIONAL NO-CALL REGISTRY.
TELEPHONE SOLICITATION
1-900 NUMBERS.
ANNUAL FEES, INTEREST RATES, ETC.
THE UNITED STATES FEDERAL TRADE COMMISSION
1. NATIONAL NO-CALL REGISTRY:
There's nothing more annoying then those credit card offers that you get over the phone. I don't know about you, but the last thing I want to be doing, while having dinner with my 1 year old daughter and my beautiful wife, is to be annoyed by phone calls from solicitors that just want to make money off me. Legitimate or not, these calls are a nuisance. If you're like me, and you would rather live without dealing with these calls, then go do this:
The FTC has created the National Do-NOT-CALL registry. Go find out more information about it. The website is: http://www.donotcall.gov
If it makes sense, complete the online form.
Take a deep breath, and relax. Within 30 days, the list will start working for you. I can personally attest that, while the solicitations have not stopped completely, they have significantly, significantly decreased.
Join the FTC No-CALL-Registry, and enjoy a reduction in telephone solicitation phone calls.
2. TELEPHONE SOLICITATION:
Believe it or not, the vast majority of lenders out there are legitimate. Also, believe it or not, a lot of these lenders utilize telemarketing as a method of reaching out to potential customers.
But beware of a wolf in sheep's clothing. Legitimate Lenders never ask for a processing fee in order to complete your application (this does not include appraisals during a real estate transaction in Escrow?We are discussing credit cards here).
Keep your personal information to yourself! Don't give out bank information, credit card numbers, social security numbers, etc., to someone you don't know, on a telephone call. Use your common sense.
If you don't have the offer in hand, or confirmed in writing, then don't pay. This is fraud. Who is this person on the phone anyway? Get their phone number, their address, their federal tax ID number, and then tell them you'll call back. If they're legitimate, they'll give it to you. If you question them, then I say trust your instincts. You're probably right on target.
Who is this on the phone? Don't trust people you haven't had a chance to get to know. Don't let one enticing offer on a phone call, be your guide...
3. 1-900 NUMBERS:
A 1-900 number is, of course, a phone number that charges the caller per minute for making the call. Whether it's a 1-900 number, or a future manifestation of the same type of telephone service, be wary of doing business this way.
The most common Credit Card SCAM, in all of its different forms, is called an "ADVANCE FEE LOAD SCAM". Typically, you will find these in the classified section of your local newspapers and trade magazines, and unfortunately, you'll also see them floating around the internet.
In a nutshell, the perpetrator will guarantee you a loan, but you have to pay them an upfront fee first. The fee can range from $100 to several hundred dollars. The charges can be extracted using telephone services like 1-900 numbers. Beware of courier services, and transactions that avoid the US Postal service, often conducted so as to avoid detection. The scam is that once the fake company has your money, they disappear from the planet, leaving you a victim of their con. You are out money, and no credit card.
Now lets' not confuse Advance Fee Load Scam artists with legitimate lenders and institutions. I can attest that there are real companies out there, trying to help you to get the credit, loans, and consumer debt services that you need. I believe in many of these services, and I believe in the convenience and power of the internet. However, use your common sense in all your business transactions in life, and that includes credit. Never give someone money without getting anything back in return. Never trust someone that you don't know. Never get enticed into a deal that's too good to be true.
Use your common sense, and don't fall prey to the con artists slight of hand, such as the Advance Fee Load Scam...
4. ANNUAL FEES, INTEREST RATES, ETC.:
Credit Card Scams come in all different shapes and sizes. Many of them are, arguably, not scams at all, but let's just call them credit card offers involving consumer unfriendly terms.
Read the fine-line. Every Credit Card Offer must provide the Consumer with written documentation on the terms of the offer.
Check the Annual Fee, the Interest Rates, the Cash Advance Fees, the Late Fees, and all other terms of the offer.
c) Make sure you know what you are getting. Some offers are for secured cards, some are for unsecured cards, and some offers are for shopping portals online and offline (Like a department store card). So, while none of these are scams, by definition, it is important that you fully understand the terms of the credit card offer that you are agreeing to.
Be a responsible consumer, and read the terms and conditions of your credit card offer...
5. THE UNITED STATES FEDERAL TRADE COMMISSION::
The best place to go for direct consumer information, protection, and remedy, is the United States Federal Trade Commission...
The FTC website is: http://www.ftc.gov
The FTC can provide you with TONS of free information about Credit Cards, and other consumer related concerns. They can help you learn more about what to avoid, how to be a smarter consumer, and what to do if you believe that you are a victim of fraud, and what your remedies may be.
The FTC is there to help...
SUMMARY:
Use the No-Call Registry to cut down telephone solicitations in your home and places of business. While many legitimate lenders utilize telemarketing, be careful. Don't give out personal information to people you don't know, don't pay up-front processing fees over the phone, and get everything in writing. Consider yourself an advised consumer on "Advanced Fee Load" Scams, and look out for the signs, when these scams regrettably make their way to you. Read the terms of the offers that you are considering, and utilize the FTC website for trusted information, resources, and all related materials on consumer credit card issues.
We've enjoyed providing this information to you, and we wish you the best of luck in your pursuits. Remember to always seek out good advice from those you trust, and never turn your back on your own common sense.
Publisher's Directions: This article may be freely distributed so long as the copyright, author's information, disclaimer, and an active link (where possible) are included.
Disclaimer: Statements and opinions expressed in the articles, reviews and other materials herein are those of the authors. While every care has been taken in the compilation of this information and every attempt made to present up-to-date and accurate information, we cannot guarantee that inaccuracies will not occur. The author will not be held responsible for any claim, loss, damage or inconvenience caused as a result of any information within these pages or any information accessed through this site.

Triple AAA in 30 Days

2007-05-28T03:19:00.001-07:00

Triple AAA in 30 Days
Have you ever wonder about how to get good credit with spending alot of money. Well here is a little secret I used to get my credit back up to par.
To work this plan you need at least $400 to begin. You should borrow this from your friends if necessary. Then go to a bank of your choice and deposit the $400 into a regular passbook savings account.
Wait a few days for the account to be posted and return to the bank to ask for a $400 loan - you offer the passbook as collateral. Since the bank is already holding your $400, you go to another bank open a savings account lending you another $400 and they won't even make a credit check. Then, with your borrowed $400, you go to another bank, open a savings account, return a few days later, borrow $400 from that bank using your passbook as collateral.
Then repeat the process at a third bank with your borrowed $400. Wait a few days to go to a fourth bank where you open this time a CHECKING account. Wait a few days and make a payment on each of the other three loans. A week later, make payments again on the three loans, and continue paying each week until you have almost paid off the balance.
A credit investigation at this point will show you with three active bank loans (which are considered hard to get), a checking account, and a paying history for the three bank loans - with you having paid up in advance. Thus, you have AAA credit in as little as 30 days. From here you go on to apply for loans, credit cards, and other items on credit.
Darryl Power over 3 years in online marketing, 1 year in Pay-Per-Click advertising and 7 years of business management.

Borrowing on a Credit Card

2007-05-28T03:17:00.001-07:00

Borrowing on a Credit Card
One of the easiest ways to borrow money of a financial institute is to use a Credit Card, available from all banks, building societies, and other financial organisations. The choices available are enormous, with a wide variety of interest charges, annual charges, loyalty schemes, and bonus points available. However there are two broad areas that you should look at:
Annual Interest Rate
Firstly if you do not intend to pay off your Credit Card bill at the end of each month, then you should look at the Annual Interest Rate (APR), this rate is typically between 13-17% at the moment, and you should be looking for a card that offers as low an interest rate as possible. You should also bear in mind that you are charged much higher rates of interest than other forms of borrowing money, so if you do not intend to pay of your bills for a long period of time, then you should seriously consider a different form of loan that is less expensive.
Extra Benefits
On the other hand if you do intend to pay off you credit card bill at the end of each month, then you should be more interested in the loyalty schemes that are on offer. These vary from being awarded points every time you purchase something (these points can than me used to purchased gifts or air miles etc), to simply being given 'Cashback' on everything you buy (typically 0.5%-1% of your purchase). You should also look at the level of service that your card company offers. They are obliged under law to offer certain protection to the consumer, but often they will increase this protection with other guarantees. Some offer extended warranties on electrical goods, extra travel insurance when you are on holiday, accidental damage insurance for any goods you buy, and even free commission on cash withdrawals when abroad.
Also some companies charge an annual fee for using their card (especially business credit card accounts), so these fees should be weighed up against the cards benefits.
Even if you usually do pay off your credit card bills at the end of each month, when you open a account you may be offered 6 months interest free credit. This is often an excellent way of saving money as you are basically given an interest free loan for 6 months. It is even more useful if you are allowed to transfer some credit card debt from a different company into the interest free offer. However there is a danger of becoming trapped in a bad debit cycle here, transferring your debt from card to card until it is completely unmanageable. The best advice is to make sure you always have enough money in the bank, or in a savings account, to pay off your debt when you are taking advantage of the interest free credit period. That way you benefit from earning interest on your savings in your bank, but as soon as the interest free credit period has expired, you can pay the entire bill off without being stung for high interest charges.
So to summarize
If you are not paying off your monthly credit card bills, look for a card that offers a low interest rate
If you are paying off your monthly credit card bills, looking for additional card benefits
Interest free credit periods are good news for saving money, but beware of being caught in a debt spiral
Credit Cards are an expensive way of obtaining a loan or borrowing money, and you should investigate other cheaper forms if you intend to borrow money in the medium to long term.

How a Credit Card Can Be Your Friend

2007-05-28T03:14:00.001-07:00

How a Credit Card Can Be Your Friend
We have all heard countless stories of people over their heads with credit card debt-maxing out every card they own, then only being able to afford the minimum monthly payment. High interest payments shackle people to their debt for years, not to mention the significant income drain the finance charges have on their families.
It is unfortunate that many Americans must live with this reality, since with some financial discipline, this delimma is avoidable. When a spending plan is developed and followed, a credit card becomes no more dangerous than any other form of payment.
When credit card bills are paid in full each month, credit card fees and finance charges do not accumulate. With a little extra bookkeeping from a spending plan, a credit card is transformed from being a burden to a very rewarding financial partner-since it provides the following advantages over other forms of payment:
ท Rewards Programs.
Many credit card companies offer loyalty programs to reward those customers who use their cards more. Rewards usually come in the form of points or cash. Depending on the company, the points can be redeemed for things like restaurant gift certificates, hotel stays, airfare, vacation packages and more. Cash cards typically pay a 1% rebate on your purchases, which makes for an extra $180 a year on monthly spending of $1,500. This level of spending is easily achieved by putting all your purchases on a credit card (including utility bill payments). There are even cards that pay more than 1% for particular types of purchases like groceries or gas, such as Citi's Dividend Platinum Select card.
ท Perpetual 0% Loan.
When you use a credit card, you are using the bank's money to pay the store instead of yours-for free. While you're waiting for your statement to arrive, your money can continue to work for you in an interest- bearing account, such as ING Direct's Orange Savings. Unlike a debit card that continually reduces your account balance, using a credit card preserves your entire bank account balance for earning interest until your statement's due date. That's an extra $35.25 a year based on a $1,500 balance at today's rate of 2.35%*.
ท Fraud Protection.
If your credit card number is used fraudulently, by law your maximum liability is $50. This is not true of a debit card. A perpetrator can easily use your debit card as "credit" transaction in retail stores or online. This type of transaction does not require a PIN number to be entered, and is especially dangerous since a thief can clean out your entire bank account in short order.
ท Loss Protection.
Unlike cash which is gone for good if lost, a credit card can be replaced within days of reporting it to the issuing bank. In the meantime, you're protected against unauthorized use by anyone who finds the lost card.
ท Warranty Coverage.
Many MasterCard credit cards warrant your purchases above and beyond that offered by the product's manufacturer. Your purchases made with one of these cards get an extra level of protection for free. See MasterCard's website (http://www.mastercard.com) for the full scoop on their coverage terms.
ท Purchase Protection.
Another benefit MasterCard offers on most of their cards. With their Purchase Assurance plan, your purchases are automatically insured against damage or theft for the first 90 days, also at no additional cost to you.
With all of these benefits over other forms of payment, credit cards can easily become your favorite way to pay. Instead of dreading your credit card bill each month, it can become a pleasant reminder of your money mastery.
Copyright 2005, Jim Hood
Jim Hood is senior contributing editor at the Discount Shopping Service Guide. He frequently writes credit card offer reviews and articles on money-saving strategies for shopping online.

Make Sure Your Credit Report Is Correct to Improve Your Interest Rates And Lower Insurance Premiums

2007-05-28T03:12:00.003-07:00

Make Sure Your Credit Report Is Correct to Improve Your Interest Rates And Lower Insurance Premiums
Did you know that you could make sure to get the best rates on your auto and homeowners insurance simply by having a good credit score.
Additionally a great credit score will allow you to get the best interest rates on your credit cards, car loans and even your home mortgage. With interest rates as low and as favorable as they current are why shouldn't you take advantage of them?
What to do ? Probably the most important first step you can take would be to order your credit report in order to view its accuracy and check for any glaring errors that could cause you problems or lower your credit score. A good credit score generally speaking is above 750.
There are 3 companies that offer credit reports. TransUnion, Equifax and Experian. There is a slight cost however a new law allows consumers the right to one free credit report every year. As of this writing only consumers on the West Coast can enjoy this benefit. Mid-west states can start receiving their free credit reports around the 1st of March 2005. For those of you that live in the South expect to be able to order your free report starting 1 June 2005 and if you're on the East Coast you'll unfortunately have to wait until the beginning of September 2005 in order to claim your free report.
Please don't take this lightly - your credit score is very important to your financial success in life. Even if you have managed to avoid making late payments or over drawing on your current credit limits you can still be in harms way. Recent reports have suggested that almost 79% of credit reports contain an error of some kind. The really bad news is that 25% of these errors are harmful enough to where they could cause some serious issues in your attempts to receive credit, better rates and lower your insurance premiums.
Additional recommendations include the obvious such as continuing to make payments on time combined with an outstanding long-term credit history and low credit usage. You can use this to your advantage by keeping your oldest credit cards debt free. Also ask for credit limit increase every once in a while. However make every attempt to avoid signing up for new credit cards or other forms of credit unless absolutely necessary.
If you do find out that your credit report does indeed contain errors promptly contact the credit bureau that issued you the credit and dispute the errors. If the bureau is unable to verify that the errors are indeed correct within a 30-day time frame they must remove the erroneous information from your report.
Taking the simple precaution of verifying your credit score could result in a substantial deduction on all of your insurance premiums and could significantly improve your rates for a new home or car loan.Timothy Gorman is a successful webmaster and publisher of Military-Loans-Online.com. He provides more free financial and home equity loan information that you can research in your pajamas on his website
Other websites operated by Tim

The Truth About Credit

2007-05-28T03:12:00.001-07:00

The Truth About Credit
What you might not know about credit.
Some people don't know about a loop hole in the credit reporting system.
You probably know that a loan in your name gets reported to the credit bureaus. And this borrowed money shows up on your credit report.
The more you owe on your credit report the lower your credit score will be.
But there is a way to get loans and credit cards that never show up on your credit report.
When you get a credit card in the name of your business, it will never be reported on your personal credit report. So you can get large amounts of cash from the banks I work with everyday and it will never show up on your credit report.
And you can start a business on paper for almost nothing. Just pick out a cool name for your new business and submit it on-line.
That means no matter how much cash you take out in the name of your business, your credit score never drops.
This is the best way most people have ever seen to get cash and use it to buy real estate, because the money is invisible.
Tom Kish. Real Estate Guru
Tom is a public speaker and trainer on the topics of real estate investing and small business cash flow. He is available for public speaking, consulting, and one on one coaching for your business and real estate investing pursuits.

Beat Credit Card Companies at Their Own Game!

2007-05-28T03:11:00.003-07:00

Beat Credit Card Companies at Their Own Game!
Have you ever wondered how much money a credit card company makes? Have you ever wondered how much of that comes from late fees? Everyone has and if you haven't you should because most likely you own a credit card, which means that these late fees has or could directly affect you.
As you have probably taken notice, credit card late fees are on the rise and have been so for awhile. There is enormous competitive pressure on credit-card interest rates and annual fees, and this has given way to a fee frenzy. For credit card issuers, late fees now represent their third largest revenue stream, (interest revenues and merchant fees rank first and second, respectively). In essence, those who pay late are now covering the costs for those credit card users who do not carry a revolving balance and those who file for bankruptcy.
So how much are credit card companies making from issuing late fees? Over the years we have watched the number of late fees charged to consumers jump to record-high levels. Late fees can range from $10 to as much as $40. The average late fee more than doubled since 1996 from $13.28 to $29.84. In fact, many major card issuers are now charging a $35 late fee. Let's assume that 100,000 people made late payments for a particular month and they were charged a late fee of $30 for doing so. This would add up to $3 million in revenue. As you can see, credit card companies are making a lot of money off of card holders and there is no slow down in sight regarding the increase in late fees.
Credit card companies are making a killing off the late fees they issue to their customers and they don't mind doing it because their ultimate goal is to make money. They are like any other for-profit business in that they sell a product or service for revenue. In the case of credit card companies, the product happens to be credit. These companies aren't just some "thing" sucking up as much money as they can. These "things" are run by man. And wherever man is involved, greed also becomes involved. These people are just like you and me. They may have a family to support, bills to pay, etc. Most people don't work just for the pure enjoyment, but for money, a source of income. And the more income we achieve the easier and better our lives become, supposedly.
Some of you may be asking, "So what do we do about the late fees?" Well there's an article that I wrote awhile back that you may be interested in. You can find this article at http://www.nextmonthonline.com/WhitePapers/Article1.aspx . It addresses several methods and tips to avoid having to pay a late fee. One method in particular that I would like to address further in this article is the Skip-a-Payment technique. If you happen to know that you can't pay your credit card bill for a particular month just skip it. Next Month Online is an independent company from credit card issuers. They allow their visitors to skip a payment for a nominal fee. This fee is generally 70% less than your typical late fee. You will accrue no late fee and no bad mark on your credit report. Credit unions often offer this type of service for loans or mortgages, but first you have to fill out an application and then you need to qualify. With Next Month Online, there is no application to fill out and everyone qualifies as long as they have a credit card. Credit card companies are not very happy with Next Month Online because they are losing money every time someone uses the Skip a Payment service. This is by far the best service you can use if you know you will be late because you save a lot of money and avoid all the hassles that come with bad credit.
Credit card companies are not backing down from increasing fees. They, for some reason, do not see us as people who make mistakes once in awhile or people with other priorities in our lives. They want their money and they want it now! This is the reason you should not back down either. Hit them where it hurts, their pocketbooks. If you know you will be late for a particular month, just use a skip a payment service because the credit card companies will no longer be taking money from you, you will be taking money from them.

Credit Cards -- What You Should Know

2007-05-28T03:11:00.001-07:00

Credit Cards -- What You Should Know
There are a lot of questions about using credit cards. Here's some important points for you:
A quick look around on the Internet this morning shows that more than 9 million people in the UK do not pay off their credit card balances each month. (The principles of what follows are the same in the USA, or wherever you are right now.)
The average balance left outstanding is over ฃ1000. The interest charged on such a balance varies according to the card, but we have seen rates of up to 29%!
When you bear in mind that banks are offering somewhere in the region of 3% interest on account balances, it's easy to see how such a fantastic amount of money is turned over within the banking and finance industry!
Consider a card with an average outstanding balance of ฃ1000: with an interest rate of 19%, this could take over 20 years to pay off at minimum payment levels! On a balance of ฃ1000 at 19% for 20 years, you'd pay back a total of ฃ3889.
Credit cards are a tool designed to make a profit for those who issued them. They are not provided for your convenience! The only way it makes sense to use a credit card is to only use it up to a point at which you can pay the full balance each month.
In other words you are using it to access money you already possess, and not using it as a form of loan. To use a credit card for a loan is going to be some of the most expensive credit you will ever encounter.
I know that life isn't always easy, and some people will say they need to use a credit card to get by. This is the worst position you could be in, and it is really important that you do something about your financial circumstances if you are in this position. Continuing along that path will steadily and inexorably lead to financial disaster.
Nobody said it's easy! But I would be doing no service at all if I avoided the facts, even if it's not what everybody wants to hear.
Another unwise use for a credit card is to get a cash advance from an ATM machine. whereas with purchases on the credit card there is an interest-free period up until the next payment is due, there is no such period of grace for cash withdrawals. Use a debit card instead.
And be aware of the deal with store cards. These can typically carry some of the highest interest rates around. Any savings are often have wiped out by the fact that you are encouraged to buy more then you otherwise might have, and even if they are genuinely savings, they are typically dwarfed by the total interest when the balance is not paid in full.
Use your credit card wisely, use it to your advantage, and get on the right side of the credit card game.

Why Should You Use Credit Cards

2007-05-28T03:10:00.005-07:00

Why Should You Use Credit Cards
Believe it or not, the way society, especially the commercial side, is set up these days, the only alternative to using credit is to pay cash for everything. But it's actually quite hard to do that. For example, if you want to rent a car, you have to have a credit card, even if you pay cash for the rental. The reason for that is because once a company has your credit card with your signature, they'll never lose money. If you default on anything, or if extra charges come up later, all they do is charge your credit card. Many companies require a credit card before they'll do any kind of business with you, for that very reason.
After you enter the workforce, it's a good idea to apply for a credit card with a small limit. Any one of the major credit card companies will help you. Those companies are Visa, MasterCard and American Express. Buy something with your credit card, and pay it off as fast as you can. That's the basics of establishing a good credit record. If you continue to do that, buying bigger and bigger items and paying them off, on time, then you'll end up with an A-1 credit rating. Then when you want to make a major purchase, like a car, or a house, you won't have any trouble qualifying at the bank.
So there's good value in using credit cards. They allow you to buy something you want now, enjoy it now, and pay for it later. That's the reason credit was given in the first place, way back in the 18th century ? to allow you to buy larger items like furniture, that you couldn't afford to pay cash for. The system worked great, and still does today ? as long as you don't abuse it.

Simplifying Your Search For a New Credit Card

2007-05-28T03:10:00.003-07:00

Simplifying Your Search For a New Credit Card
Today, selecting the proper credit card can be a bit confusing to say the least. There are literally hundreds of offers from the major institutions eagerly competing for your business. The easiest way to shop for a credit card is to break them down into categories. There are seven major categories that all credit cards fall into. Each category is listed and explained below. Once you identify the proper category, simply narrow down the offers to the ones that best suite your particular needs and lifestyle.
General Purpose/Low Interest Credit Cards:
These cards are great general purpose credit cards for those not interested in all the special features and costs associated with CashBack or Rewards cards. They feature either a low introductory interest rate, and/or a low fixed rate.
General purpose credit cards are usually favored by those who tend to carry a monthly balance on their cards. A lower interest rate can add up to substantial savings on finance charges, and be of more value than cards offering high rewards, or cash back. If you are planning a large purchase, a low introductory APR may be just what you need. You can stretch out your payments over the length of the introductory period, and save a bundle on finance charges.
Cash Back/Rebate Credit Cards:
Cash Back credit cards give you cash or rebate incentives every time you use the card. The amount given is usually a percentage of your total purchases excluding interest and finance charges. Cash back credit cards should be considered by those who tend to pay off their entire balance every month, and therefore would not realize the benefits offered by low interest rate cards. Cash back cards are always hard to beat, but others may favor a rewards program offering goods and services in place of cash. The card you choose will depend upon your particular needs and lifestyle.
Reward Credit Cards:
Reward credit cards give you points every time they are used to make purchases. The points that you accumulate can later be redeemed for goods and services. Cards offering reward points are most attractive to those who tend not to carry a monthly balance. If you pay off all or most of your balance each month, a low interest rate will be of little consequence, making reward cards the perfect solution for reaping some extra benefits out of your spending dollars. There are many cards in this category that give special rewards as incentives to shop at specific retailers. Check the terms of each card to find the one that will best suit your needs.
Airline Miles/Travel Credit Cards:
If you're an airline traveler, you should look into credit cards that offer Frequent Flier miles. You earn Mileage points as you spend on your credit card. You also earn mileage points for the miles you fly. If you took a round trip to Orlando from Washington DC you would earn 1516 mile points. If you bought the ticket on your card you would earn even more! Most Frequent Flier credit cards will give you 5,000-10,000 free miles as a sign-up bonus, as well as discounts on car rentals, free hotel upgrades, and many other perks. Be aware that there may be caps on the amount of miles you can earn in a year, as well as expiration dates for unused miles.
Business Credit Cards:
If you own a small business then you should consider a business credit card. With a business credit card, you can make purchases under your business name, allowing you to separate your business and personal expenses. Business cards can in some cases carry a higher limit than a personal card, and additional cards may be issued to executives, or employees. Most institutions offer business cardholders a special categorized statement that makes it easier to manage your company's finances and spending habits.
Student Credit Cards:
Student credit cards are available to actively enrolled College students. They are ideal for building a credit history, and teaching the principles of financial management. After graduation, the credit history established with a student credit card can be a great help when buying that first new car, or even applying for a mortgage. It pays to start early and establish yourself as a responsible person by paying your bills on time. A student credit card usually carries some restrictions not found on ordinary credit cards. A co-signer is sometimes required on the account, and in such cases, permission from the co-signer must be obtained before the credit line can be increased.
Bad/No Credit Credit Cards:
If you have bad credit, or simply no credit history at all, there are alternatives to help you build/rebuild your credit. Many institutions offer secured, or pre-paid credit cards to individuals seeking to build or rebuild their credit. A secured credit card requires that you supply the institution with some type of collateral such as a car, home, boat, or cash. They will issue you a credit card secured by the value of this collateral. It functions just like a regular credit card, except that if you default the bank can seize the collateral.
Another solution is a Pre-Paid credit card or "Debit" card. Pre-Paid cards require that you deposit funds into the card's account in advance of making any purchases. When a purchase is made, the funds are deducted from the account balance. This is not really considered a credit card since no credit is actually being granted by the institution. Debit cards are a great alternative to carrying cash, and are hence much safer.

Credit Cards or Store Cards - Which Is Better?

2007-05-28T03:10:00.001-07:00

Credit Cards or Store Cards - Which Is Better?
Introduction
In this article, a presentation is made of the differences between major credit cards and credit cards offered by specific stores to their customers. The purpose of this article is to provide a general overview of major credit cards and store cards to aid consumers in making decisions regarding which lines of credit lines would be the best for them in a given set of circumstances. In most situations, due to the higher rates of interest charged by most store-specific cards, it is best for the budget-conscious consumer to consider forgoing those accounts in favor of a major credit card.
With that said, we are not endorsing any particular credit card brand in this article. Rather, the materials presented are for informational and educational purposes only.
General Availability
Major credit cards are accepted in a wide variety of places and venues. Indeed, the major credit card companies make it a point of promoting how wide spread card acceptance is in this day and age.
On the other hand, store-specific credit cards are good only at the issuing store.
Where to Apply
It is simple to apply for major credit cards. Nearly any bank or financial institution can provide a customer with an application for one or another of the major credit cards. Additionally, the Internet has become a handy resource for those men and women interested in applying for and obtaining a major credit card.
Store-specific credit cards only can be applied for directly at the store or shop. Additionally, if the store has an Internet presence -- and many major stores and even smaller shops do so in this day and age -- applications for store-specific credit cards can be made online.
Annual Fee and Related Charges
Many major credit cards do charge an annual fee. Some major credit cards charge an additional or supplemental membership depending on where the card was obtained.
Store-specific credit cards normally are free of annual fees and similar charges to their customers. However, store-specific credit cards carry with them notably higher rates of interest than can be found with major credit card accounts.
Common Clauses and Provisions
In the United Kingdom, and in most European Union countries, there are clauses and provisions that must be included in each and every monthly credit card billing statement -- both from major credit card companies and on store credit card accounts as well. These clauses and provisions are:
A detailed listing of all credit card transactions
A detailed listing of the amount owed from the previous month plus the extra amount or interest to be paid on that amount owed
The total amount owed for the current month
The minimum amount that must be paid during the month. In the United Kingdom, this amount is about 3% of the balance or ฃ5 whichever is greater.
An estimate of the interest payable if you do not pay your account in full.
The date by which the account must be paid if interest charges are to be avoided
A detailed listing of the monthly interest rate for purchases, the APR (annual percentage rate) and the interest rate if you have used your card for cash
Conclusion
In the final analysis, one should only have as much credit as is absolutely necessary. Generally, it is not a wise decision to rake in a bunch of different credit cards. Rather, the best policy usually is to maintain one or two major credit cards. Also consider that store cards generally do not offer the same benefits as credit cards such as balance transfers, although it is common to get brand exclusive reward schemes with store cards. Finally, one must be cautious about obtaining store-specific credit cards due to the higher rates of interest that come with these accounts.

How To Start A Second SEPERATE Credit File!

2007-05-28T03:09:00.001-07:00

How To Start A Second SEPERATE Credit File!
Your personal credit file is separated from those with the same or similar names by several factors, including a driver's license number, birth date, or spouse's name. Although these are three important identifying marks, the number one identifying mark on your credit report is your social security number. Since there is no one else in the United States with your number, your file is easily identified. The chances are very small that the social security office in your area will issue a second number just because somewhere down the road you messed up your credit. However, it is impossible that a second personal file would be created.
The second kind of credit file is the business credit file. Business credit files are identified by the business name and by a computer generated and assigned identification number. Your business file is listed with credit bureaus like Dun and Bradstreet and Stanley and Porous, etc. A Company credit record can be built and used just like a personal one. The idea is to take a hobby or trade that you possess, and start a new small business for which you can create a name and a new credit file. There are hundreds of small businesses that can be run from your home. These small businesses have the potential to generate high part-time or full time earnings. I suggest visiting your nearest bookstore or library to obtain a book on the numerous business opportunities available.
Once you have established a business name and idea your next step is to build a credit history for it. This is done using basically the same techniques that you would use for building your personal credit record. It does not matter how bad your personal credit record is. The business will be judged on its own record. I just recently had a student obtain an American Express card through her small business, which is only nine months old even though her personal record is riddled with bad credit. As you will see, the key is to maintain a stable payment history with all credit accounts.

Credit Cards and How To Choose Them

2007-05-28T03:07:00.005-07:00

Credit Cards and How To Choose Them:
It may seem like a simple question but its important to take into account a few factors when choosing your credit card. If you are in the enviable position of being able to pay off your card every month then you are amongst the few. If like most you don't then we can offer you some guidance.
1.Interest rates: This is the most important factor to consider when managing your credit card debt. Every day we are offered 0% introductory rates for 6 to 9 months. These are usually for balance transfers and are a great way to transfer high interest loans or credit card balances to a 0% interest rate. Watch out for statements, which only refer to the monthly interest rates as well. Something like 'rates of 1.5% per month' on your statement may not sound like much but this is equivalent to 19.6% per year!
2. Annual fee: Most cards now do not charge an annual fee. Make sure you get a card that does not charge these fees.
3. Cash advances or withdrawals: This usually represents very poor value for money. Credit Card companies will charge in the region of 2% per month. If you can avoid it do not use this facility.
4. Reward points or Loyalty Schemes: These kinds of cards are gaining in popularity. Air miles and cash back rewards are being used to entice customers. Many people base their credit card choices on these kinds of benefits. If you read the fine print you will find that you have to spend are large amount to qualify for the points. Saying this if you are a frequent traveller paying for your air ticket with your credit card will help you build up substantial air miles.
5. Insurance: All credit cards should come with insurance, which covers you for fraud or theft that results in your card being used before you can cancel it. With the rise in the number of people buying on the Internet nowadays this is a vital requirement. The consumer credit card act outlines what the credit card company should be liable for. Some credit cards also offer free travel insurance, again a handy benefit if you are a frequent traveller.
6. Gold and Platinum cards: These may look good in your wallet or purse but they usually not the most competitive cards on the market. Firstly you have to earn a certain salary to qualify, although surprisingly these salary levels are set pretty low. There is also an annual fee for the use of the card, which in today's market is a cost you shouldn't have to pay. Don't be blinded by the image there are many cards out there that offer far more.

Credit Cards: How To Use Them

2007-05-28T03:07:00.003-07:00

Credit Cards: How To Use Them
Credit cards can be a very quick way of getting into even more debt if you do not know how to use them properly. UK debt is now at an all time high and, excluding mortgages, Credit Cards are one of the main contributors.
It's a lot easier to get a credit card than it is to get a mortgage or a loan. So it makes sense that more people own a credit card. With interest rates that are quite high in relation to loans and mortgages you can see why the debt can get out of hand.
In order to get the best value for money out of your credit card you need to be disciplined in the way you manage your debt.
Make sure you make the payments every month:
If you cannot pay off the whole amount every month make sure you pay at least more than the minimum required. This will help you pay more of the capital off every month. Make sure you take advantage of the interest free periods in this case.
Don't abuse your credit limit:
A credit limit does not mean free money. Credit Card companies are happy to raise your limit if they see you pay off your card regularly. Don't be tempted to use this money it just puts you further in debt and will take you longer to clear it. Credit Card companies know that most people will not be able to resist spending more and you are just helping the big card companies to make more money.
Check your statements every month:
This is a small but important point. Credit Card companies are not perfect and often errors are made on your statements. Make sure all items on your statements are goods and services you have purchased. If you do notice an error contact your credit card straight away. Keep an eye on the interest rate you are charged. If you are on an interest free period make sure you are still not being charged interest.
Know your rights:
Many people do not know their rights when it comes to using their credit cards. Did you know that if you buy goods or services and these are not delivered or are not to the standard advertised then the Credit Card is liable. If you order a sofa and the furniture store goes under and you do not receive your sofa then the Credit Card company has to reimburse you the amount spent. A little tip: If you are paying for an item and it is to be delivered at a future date, always use your credit card as it will be a form of insurance if there is a problem. You can always pay the amount off when the goods arrive if you had planned to pay cash.

Credit Card Balance Transfers Can Help You Stop Putting Money Down The Drain

2007-05-28T03:07:00.001-07:00

Credit Card Balance Transfers Can Help You Stop Putting Money Down The Drain
As you probably know, interest rates are at all time low right now and if you aren't getting the best deal from your credit card company then they owe it to you to either lower your rate, or you owe it to yourself to find a better deal. You see, credit card companies need your business in order to succeed and if you refuse to pay a penny more than you have to then you'll be doing yourself and others a big favour indeed. By doing this, you'll avoid paying more than you should and the companies will stop treating its clients inappropriately.
Now that this is clear, we will talk about the essentials of balance transfers, how they work and how you can ensure that you get the absolute best possible deal.
1. First and foremost, understand what a balance transfer is. A balance transfer is when you transfer the balance from one card to another in order to get a better interest rate than the one that you are currently getting.
2. Second, to find the absolute best deals, look to transfer balances on cards where the initial interest rate is 0% and the amount after that is lower than the one you have now. For instance, if you're a cardholder that has an interest rate of 27.4% on a ฃ1000 balance and you only pay ฃ150 a month for 6 months, you will not pay off the balance in 6 months. Instead you will pay ฃ247 worth of interest and your balance after 6 months will be ฃ346. In contrast, if you had a 0% card and make the same monthly payment then your balance will be reduced to ฃ100 at the end of the 6 month period, a tremendous saving!
3. Third, don't throw those offers that you receive in the mail away. If you have great credit then you'll likely have credit card companies vying for your attention. Just use this power to your advantage and find the very best 0% deal for you.
4. If no good deals seem apparent, then you have to find your own deals. You can do this by conducting a thorough search on the internet to see if you can find a 0% card offer.
5. Once you've done this, request information and then review it carefully. Pay close attention to the rate after the initial introductory period is over. For instance, if you have two choices of cards with 0% interest rates for 6 months and one charges an interest rate of 15.00% after the initial period and one that charges 11.00% after the initial period then by all means choose the second one because it is by far the better deal overall.
6. Read and then re-read the credit cardholder agreement a couple of times. Make sure that you understand all of the jargon and if you don't, find someone that does before you sign it. Review it closely to make sure that you are getting the best deal possible. For instance, when evaluating deals, you should ask yourself these questions:
a. How long does the introductory rate last?
b. What will be the rate after the teaser expires?
c. What are the cards annual fees? Can they be waived?
d. Are there any transfer fees that you should be aware of?
e. Are there any perks that are offered? (Ex. frequent flier miles, free gifts, etc).
7. Once you've decided on an offer, fill out your application fully and get it in the mail as soon as you can.
8. Once you get the offer, make sure that it is a 0% teaser rate and if it isn't, then contact the company right away. If they aren't open to doing so then tell them that you're cancelling the card and look for another company that delivers what they promise. Your primary goal is avoid the old "bait and switch" while simultaneously saving money on interest.
9. While waiting for your new card, make sure that you continue to pay on your old card to avoid glitches in your credit report and once you receive notification that the transfer has been made, make sure you contact the old company and make sure that they received the payoff amount.
10. After the teaser rate is up, don't be afraid to jump from one credit card to another after the teaser expires. You see, there is absolutely nothing wrong with surfing cards and taking advantage of 0% offers whenever you possibly can. Just keep finding and researching great deals.
That's it my friend. Credit card transfers don't have to be so confusing and daunting. If you follow the above mentioned steps then you can and will win the balance transfer rate and stop throwing your hard earned money down the drain.

Learn How to Improve Your Credit Score

2007-05-28T03:06:00.005-07:00

Learn How to Improve Your Credit Score
Having a damaging credit record can hurt you in many ways. It may prohibit you from making an important purchase such as a home, car, computer or vacation. Without a healthy credit report you are severely limiting yourself from possible lenders. If you do find a lender you will undoubtedly be charge exorbitant interest rates far exceeding what recipients would receive if their credit history is in good standing. So how can you fix your credit score if you've been less than diligent with repayments to creditors? Well contrary to what many advertising scams will tell you, you can't fix your credit overnight. In most instances it takes 7 years for a payment infraction to be deleted from your credit report. If you were to file bankruptcy it would take 10 years. Obviously fixing the problem before taking such drastic measures is desired. Bankruptcy must be used only as a last case scenario and the implications must be fully understood before proceeding with such severe measure. Besides bankruptcy staying on your credit history for 10 years and posing large problems if you decide to seek out a financial lender, it can also impact other areas of your life. For instance you may be rejected from certain jobs, prohibited from taking on certain responsibilities and positions within your own company if you are a business owner and you will still be in the bad books of the people who you may require to lend you money.
There is no way to fix your credit overnight no matter what the advertisements claim. The bottom line is that if you are faced with difficult financial situation you must first look to fix the problem yourself through using basic budgeting guidelines. If you are not good at this, you may be able to hire a professional personal money manager to do this for you. Next you must figure out what your rights are and try to amend problems before they arise. In most cases, creditors would be wiling to work with you and come up with some repayment alternatives rather than sending your delinquent account to a collection agency. If it has gotten so bad that you have creditors calling your house all the time, you must research what your rights are. Collection agencies are heavily restricted by laws but that doesn't stop some agencies from taking advantage of some less informed individuals. For instance, collection agencies are only allowed to call during certain times of the day and in most cases must cease all calls if you request them to do so in writing.
If you are experiencing financial problems the best thing to do is get informed. Learn the laws and research your options.

Free Credit Reports Now Available From the FTC

2007-05-28T03:06:00.003-07:00

Free Credit Reports Now Available From the FTC
The Federal Trade Commission (FTC) has set up a new website (www.AnnualCreditReport.com) where US residents can obtain free copies of their credit reports from the three major credit report bureaus (Equifax, TransUnion and Experian). The FTC site was set up as part of the Fair and Accurate Credit Transactions Act enacted last December. The site was set up in an effort to help fight the increasing threat of identity theft. The credit reports must be ordered from the FTC site to get them for free. If you order your credit report directly from one of the credit report agencies' sites, you'll be charged a fee for the report.
While a number of websites on the Internet currently offer free credit reports, these free reports require a credit card be put on file as a free trial membership of their credit report monitoring service. The reports have been free if you remember to cancel the trial membership, but can end up being quite costly if you accidentally forget. The new FTC site is marketing free and no credit card is required.
To request your credit reports, you'll need to provide your name, address, Social Security number and date of birth. In addition, the credit bureaus may ask you for other information to confirm your identity such as your current monthly mortgage payment. Consumers can also order their free credit reports by calling 877-322-8228 (toll-free) or by mail by writing to: Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281
The free credit reports aren't currently available to all US residents. They're being phased in over the next year by region to prevent the system from being overwhelmed. Currently residents living in Alaska, Arizona, California, Colorado, Hawaii, Idaho, Montana, New Mexico, Nevada, Oregon, Utah, Washington, and Wyoming can obtain the free credit reports. Residents in the Midwest can get their free credit reports beginning in March, residents in the South beginning in June and residents in the East beginning in September.
Instead of ordering credit reports from all three credit report agencies at once, you might want to consider staggering the three reports so that you receive one credit report every 4 months. This allows you to see how your credit report is changing over time and whether any mistakes you find have been corrected. It will also increases the chances that you will catch any attempts at identity theft more quickly. If, however, you're considering a large purchase such as a home or car where your credit score will be used to determine your eligibility, you'll want to get all three right away. This will allow you to take care of any potential problems as soon as possible.
Once you've received your reports, review each one carefully. The three credit reporting agencies handle millions of pieces of information each year and some estimates have errors in as many as half of the credit reports with a major error in ever one in four. By making sure that all the information contained in the reports is accurate, you will ensure that you receive the best rates from credit agencies in the future.
Now that credit reports are free of charge, there is no reason not to request them each and every year. Keeping tabs on your credit report is one of the most effective ways to protect yourself against identity theft and make sure that all the information that your creditors are accessing is accurate.

10 Ways To Boost Your Credit Score

2007-05-28T03:06:00.001-07:00

10 Ways To Boost Your Credit Score
1. Deleting Errors in 48 Hours
This is the absolute fastest way to correct errors on your credit report and raise your credit score. However, it can only be done through a mortgage company or a bank. If you apply for a home loan and find errors on your credit report, request the loan officer to conduct a Rapid Rescore. But don't mistake it for the credit clinic tactic of multiple dispute letters.
The Rapid Rescore strategy requires proper paperwork. You need proof that the item is incorrect. It must come from the creditor directly. For example, a letter stating the account is not your account, a letter stating the account was paid satisfactorily, a release of lien, a satisfaction of judgment, a bankruptcy discharge, a letter for deletion of collection account or any relevant evidence.
This is the same documentation a bank or mortgage company would require for the credit accounts anyways. The difference is, now you can improve your credit score and receive a lower interest rate. The results are not guaranteed and will run you about $50 per account.
2. Deleting Negative Credit
This is the infamous area where you've heard of all the scams. Credit repair clinics charge "an arm and a leg" and promise a clean credit report. Sometimes even a new credit profile! People spending hundreds, or even thousands, of dollars for something they can do themselves.
Removing errors is simple. Deleting negative credit that is accurate requires advanced methods. But that is not the scope of this report. So I'll focus on the deleting the negative errors.
Credit report errors easily disappear by using a simple dispute letter. If you have the paperwork proving the error as mentioned above in Rapid Rescore, send copies of that along with the dispute letter. This will make the credit bureau's job easier and you will get faster results.
If you don't have the documentation to prove the error(s), send the dispute letter anyway. According to federal law, the credit bureau's have a "reasonable time" to validate your claim. They will contact the creditor for verification of your dispute. Then the account will be reported accurately - or deleted. It has been generally accepted the "reasonable time" to complete this task is 30 days.
If you're not the do-it-yourself kind of person. Or don't have the time. You could hire someone who is very economical.
3. PiggyBack Someone's Credit
This is a fast and great little credit score booster. But it requires a very trusting relationship. Simply put, someone else adds you to their credit account. For example, when applying for a credit card, you may have seen the section to add a card holder. If your trusting person adds you, their payment history is now reported on your credit report too. If they have perfect credit, now you have a perfect account.
To make this more effective, use an aged account. Imagine if your trusted person has a 10 year old credit card account with a perfect payment history and a balance of only 50% of the credit limit. Wouldn't you love to have this on your credit report? The easy part is your trusted person just calls the credit card company and requests a form to add a cardholder. Once completed and activated, their entire account history and future is now firmly planted on your account. Imagine if you secured 3-5 of these accounts - especially installment accounts. Your credit score could sky-rocket!
The challenging part? Finding the trusted person. Since you already have a low credit score and bad credit, how eager will someone be to make you a cardholder? Even your parents don't want you to damage their credit. But, no one says you need to possess the card! In other words, your trusted person could add you as a card holder and never give you the card or PIN or any information. Since the bills and all account information is still mailed to the trusted person's address, you won't know anything about the account. This scenario could land you many trusted persons. And you still benefit with a higher credit score.
4. Playing Round Robin
This strategy is one of the oldest credit building techniques around. It used to be accomplished with secured savings accounts. But now, it's much easier with secured credit cards. In fact, I've used this method myself.
Here's how it works: Take ,000 (or what you can afford) and get a secured credit card. Once received, get a cash advance of 70% of your credit limit. Get a second secured credit card. Once received, get a cash advance of 70% of your credit limit. Get a third secured credit card. Once received, get a cash advance of 70% of your credit limit.
Open a new checking account with the final cash advance. Use this account only for making payments on your three new credit cards. If you make your payments on time every month, your credit score will increase because you now have three new perfect payment credit cards. (Initially, your credit score might drop a few points due to the rapid, multiple accounts being opened. However, be patient because within 4 months of no new accounts or any delinquencies of any account, you will see your credit score increase. Mine increased 60 points in 60 days!!)
5. Pay on Time
This one is quite obvious. But after 12.5 years in the mortgage business, I discovered it still needs repeating. Your creditors were gracious enough to loan you money. Now pay your damn bills! If you don't, your credit score decreases. EVEN IF ONLY 30 DAYS LATE!
That's right folks. For some reason people think, "I'm only a few weeks late. What's the big deal?" Well, for the loan company, if you pay late but consistent, they make a lot more money with late fees and more interest (if a simple interest loan). For you, your credit score is damaged. If you think long-term and credit score, I'm certain you would not have a cavalier attitude.
6. Pay Down Debts
This seems like an obvious method, doesn't it? But it is not as transparent as you might think. Remember, we're playing with high-level statistics and probabilities which evaluates and forecasts trends in your behavior. Here's what you do...
Never pay off your revolving debt in it's entirety! Isn't that a surprise? Think about it. Your credit score is a reflection of your ability to manage your credit. Paying off your debt is not managing your debt. If you have a zero balance, how can you manage it? You don't. It no longer exists. And you cannot manage what does not exist, right? Therefore, in terms of credit score, you have demonstrated your ability to swiftly pay off accounts to avoid managing them. Thus, slightly decreasing your credit score.
One exception, of course, is if you're over extended to begin with. Pay off what's necessary to make your credit profile look great. Then manage the remaining credit.
7. Don't Close Accounts
Even if you pay off revolving debts, do not close the account. The longer an account is open with no negative reports, the better it reflects in your overall credit score. This is due to the weighted-average in the credit score formula. Many credit experts suggest a balance of 30% of your credit limit. That's ideal. But you can go as high as 70% and still maintain a healthy credit score.
8. No New Credit
You must be vigilant in your credit behavior if you want the best credit score. Therefore, do not get any new credit unless it is absolutely necessary. Each time you apply for credit, an inquiry is added to your report. This usually drops your credit score slightly. When you have fresh credit, there is no track record how you will manage (or pay) this account. Therefore, it's a higher risk which results in a minor drop in your credit score. Remember, your credit score is about risk assessment.
Here's what you do: obtain credit for your housing, transportation, college or continued education and 3-5 credit cards. That's really all you need for personal credit. If you want more credit, request a credit limit increase on your current cards rather than apply for new ones.
9. Maintain A Mix of Credit Types
If you show you can handle different types of credit at the same time, you are rewarded with a great credit score. In other words, get installment loans like vehicle, personal loan or mortgage. Get revolving credit like credit cards: Visa, Mastercard, Sears, Sunoco Gas, Costco. By mixing it up, you demonstrate you can manage your credit because you will have short term and long term credit with a fixed payment. As well as a "variable" monthly payment on your credit cards.
Keep these accounts open with a balance of 70% or less and paid on time and you will witness your credit score climb to great heights.
10. Don't File Bankruptcy or Foreclosure
Here's the most obvious advice: Don't file for bankruptcy or foreclosure. These stay on your credit report for 10 years and always decrease your credit score. The older the bankruptcy or foreclosure account becomes, coupled with re-built credit history, the less of an impact they play on your credit score.
Contrary to popular beliefs, you can legally delete a bankruptcy and foreclosure. It's not easy. But it's possible. See the advanced methods for that solution.
To quickly rebuild your credit history after a bankruptcy or foreclosure, use the Round Robin strategy above and get secured credit cards. Now you can even get a car loan or mortgage right after bankruptcy.
ฉ 2004 David Czach.
-------- Editor's Note ----------
Dave Czach has 12 years experience in the mortgage business and a Bachelor's Degree in Real Estate. He can be reached at http://myLoanHero.com/go.cgi/daveczach.
This article may be reprinted without compensation provided there are no changes whatsoever to the article, the copyright notice and the complete Editor's Note. Any reprinting or duplication without these conditions is copyright infringement.

What You Need To Know About Credit Cards

2007-05-28T03:05:00.001-07:00

What You Need To Know About Credit Cards
What is a credit card?
A credit card is a card that allows you to borrow money to pay for things. There will be a limit to how much you can spend called your credit limit. At the end of each month you can either pay off the whole of the amount you owe or make a minimum repayment.
Other kinds of cards include:
1) A cheque guarantee card, issued by your bank, that you can use to ensure that your cheque will be honoured up to a certain limit.2) A chargecard where you have to repay the full amount at the end of each month.3) A debit card, issued by your bank, where whatever you spend is immediately deducted from your bank account
Do you need a credit card?
Using a credit card is a useful way of making purchases:
a) A credit card means you don't need to carry huge amounts of cash around and risk losing it.b) A credit card means you can buy items over the internet.c) A credit card means you can make purchases abroad without having to worry about local currency.d) A credit card gives the opportunity to spread the cost of a large payment over several months.e) A credit card is useful in an emergency. For example, an unexpected repair to your house or car.
How do you choose a credit card?
The main two UK credit card issuers are Visa and Mastercard. These are accepted in most places and in 130 countries worldwide. Beware of less well known brands that may not be accepted everywhere.
Before you choose which credit card is the best for you, remember to read the terms and conditions carefully. Never sign up for a credit card without fully understanding what you are agreeing to.
Remember that all the plus factors will be prominently displayed in large print.
You may have to study the small print carefully to discover if there are any negative factors.A list of the current cards on offer in summary is available on this credit card summary page.
What You Need To Consider:
1) APR (Annual Percentage Rate)This is the rate of interest that you will pay on any outstanding balance.
2) Special Introductory RatesYou may be offered a low or 0% rate of interest for a limited time (Up to 6 months) when you sign up for a new card. A higher rate of interest may be charged for cash withdrawals.
3) Balance Transfer RateCard issuers may offer you a lower rate of interest if your swap your balance from another credit card to theirs.
4) Interest Free periodRemember to check when interest payments will begin. Will you pay interest from the day of the purchase? Or will you have a number of days interest free before you begin to pay? There is usually no interest free period for cash withdrawals.
5) Cashback and RewardsSome cards over points or rewards for every pound spent on the credit card. Make sure that these are appropriate for you. For example, there&'s no use collecting airmiles if you never fly.
6) Minimum RepaymentRemember to check what the minimum monthly repayment will be. If you borrow ฃ1000 on your credit card the monthly minimum repayment will probably be in the region of ฃ25. But if you only pay this amount each month it will take a long time to pay off the balance and cost a lot in total when you include the interest payments.
7) Annual FeesThis is the fee that the issuer will charge you every year for using their credit card. Not all credit cards have an annual fee, so remember to consider this when you are choosing which one is right for you.
8) Late PaymentsThere will be an extra charge, as well as the interest owed, if your payment is late. This charge may even be more than the amount you owe so be very careful to check what the charge is, and to ensure that all your payments are made on time. A good way of doing this is to set up a direct debit from your current account.
9) Exceeding Your LimitYou may also be charged a fee if you exceed your credit limit.
Will Your Application Be Accepted?
Whether or not your application is successful will depend on your credit rating. Your credit rating depends on your credit history (a record of your use of credit) and is based on the record of your ability to repay debt.
You can obtain a copy of your credit file by contacting a credit reference agency. There may be a small fee for this service.
When you application has been accepted you will be given a credit limit. The credit limit will be fixed when you first apply for your card (although you can ask for it to be increased or decreased later) and the limit, including the amount you have left available to spend, will be shown on your monthly statement.
Insurances and Protection.
What You Can Do:
1) Take good care of your credit card to ensure that it isn't lost or stolen.
2) To prevent misuse of your card you must report any loss or theft of your card to the issuer immediately. Many issuers allow you to register all your cards with them so that in the event of you losing a purse, handbag or wallet they can all be cancelled with just one phone call.
3) You must keep all your receipts and also check your statement carefully and report any suspicious transactions. For example payments that you have no record of making.
4) Credit card companies are now issuing cards with PIN (Personal identification numbers) which are known as Chip and PIN cards. Rather than signing your name you will be asked to enter your PIN onto a keypad. You must ensure that you keep this number secret.
What The Issuer Will Do
1) The issuer should insure you against loss, misuse or theft of your card.
2) The issuer may also insure your purchases for up to 100 days.
3) Your issuer may also provide protection against you being sold unsuitable or shoddy goods.
Important Points To Remember:
a) Credit cards can be a very useful tool to help you to manage your finances.b) Choose your card carefully, remembering to read and understand all the terms and conditions before you sign up.c) Remember to set yourself a budget and decide how much you will pay off each month.d) Check your statements carefully each month.e) Look after your card to prevent it being lost or stolen.

Balance Transfers Introduction

2007-05-28T03:04:00.005-07:00

Balance Transfers Introduction
Credit card balance transfer involves using a credit card to pay off the amount outstanding on one or more credit/store cards. The total debt then moves to one card.
The main benefit of balance transfer is a money-saving one. In the competitive credit card market an increasing number of companies are offering a 0% interest rate for a fixed period on balance transfers made by new customers. This allows new cardholders to make considerable savings in interest repayments. Interest free periods vary and certain credit card issuers extend the 0% interest rate offer to cover new purchases, it is worth taking great care to compare balance transfer offers well before deciding which one to choose.Some companies offer lower than average interest rates on transferred balances for the life of the balance transfer. This may be good news for card users who are not planning to pay back credit card debt in the short term.
Transferring credit card balances is usually a simple process. Once a card application is approved it usually involves a phone call to the new card issuer to transfer the balance(s) from the other card(s). Many credit card companies also offer an on-line service, making it even easier to transfer balances via the Internet.
There is usually a window of time after a new card is approved during which balance transfers attracting the promotional interest rate must be made.
A word of caution regarding balance transfers. Minimum monthly payments still need to be made. Fall behind with minimum payments and fines can be made and interest free offers withdrawn. The same can happen if credit limits are exceeded.
In a market full of balance transfer deals, offers vary greatly. It is important to double-check the details carefully before signing on the dotted line. For example:
Are there any additional fees to be paid when balances are transferred?
Do I need to make a minimum monthly spend using the new card to qualify for the promotional balance transfer rate?
How soon after my credit card is approved do I need to make the balance transfer?
What interest rate is charged on new purchases made using the card? In particular, 'Balance transfer for life' cards often put payments towards clearing the low interest balance transfer and not the recent purchases that attract higher interest
Do I get charged interest on new purchases from the time the purchase is made?
What does the interest rate revert to after the promotional period has finished
Before taking up a balance transfer offer, also take time to consider the amount you need to move and how much you intend to pay off and purchase each month. That way you can be sure that you choose the right card for you.

Credit Card Balance Transfers Explained

2007-05-28T03:04:00.003-07:00

Credit Card Balance Transfers Explained
What is a balance transfer ?A balance transfer can be explained simply as a balance transfer! When a balance is transferred usually from a credit card, but possible from a bank account or loan to a credit card with a offer interest rate (usually 0%) for a set period. It does not have to be the entire amount. The card receiving the balance will an interest rate for a set term, normally 6 months, but can be 9 months or even a year. Take a look at the current balance transfer deals currently available. This will give you a flavour of the typical kind of deal available.
Should I apply for a balance transfer ?
It is important to remember that a balance transfer does not mean that the debt has gone away. It just means you are not paying interest on it. You will still have to maintain payments.
This may seem obvious but many people do not get this straight in their mind.
The basic criteria for getting a balance transfer is when you regularly have an outstanding balance after making your monthly payments. This is the amount you should look to transfer to another card. This will mean that for the period of the offer you will pay no interest on the balance (provided you make the minimum payments).
You should be very wary of taking up a balance transfer, if your overall debt is increasing. A balance transfer is not a green light to spend more money. The money you save should be used to decrease your debt.
What should I look for in a balance transfer ?
You need to be aware of the following when looking for a balance transfer card
Good things
Length of offer period.
Offer Interest Rate.
The zero or low interest rate charged on the balance.
Possible transfers from loans and overdrafts.
On some cards you can transfer from existing loans and overdrafts and still get the offer.Bad things
Cut-off period for the balance transfer offer.
Hidden Charges on transfers.
Some banks will charge a handling fee on the balance transfer.
How long the offer is valid for ?
There is usually a cut off point from the account opening when the offer is no longer valid. Be very aware of this otherwise you could end up transferring a balance to a higher rate !!
What about new purchases ?
Unless there is also a 0% interest rate on new purchases then you should avoid making new purchases on a balance transfer card. This is because the banks will look to reduce the balance transfer debt quicker than the new debt. Provided your credit history is reasonable, there is nothing stopping you having several cards for different purposes. A good way is to have a card, which specialises in 0% on new purchases and another card for balance transfers.
What happens when the balance transfer period finishes ?
When the balance transfer offer period finishes the debt will revert to the typical variable APR. The lenders hope at this point that the cardholder will retain the card and some of the debt, so they can then start charging interest and making some money! So take into consideration the low interest rate credit cards. However, there is nothing stopping the disciplined credit card holder from switching to another balance transfer deal and closing the account. The cycle then starts again. Always allow 6 weeks to 8 weeks before the end of the offer period to apply for a new card. This means you can get the balance transferred to the new card before the lender can start charging the higher rate. You have to be organised to do this, but if you are it does work. People who regularly switch balances are know as card tarts.
The Golden Rules
There are three things to look out for with a balance transfer card
As mentioned previously, the unsuspecting can get caught out when spending on a balance transfer card.
Maintaining regular payments. If you miss a payment you incur some penalty, so be aware. To be safe set up a direct debit.
The interest rate applied when the offer period finishes.Good luck with your choice.
Neil Brown is a freelance writer and regular contributor to the credit card sites Choose A Credit Card and Search4 Credit Cards.

Useful Tips When Choosing Credit Cards

2007-05-28T03:04:00.001-07:00

Useful Tips When Choosing Credit Cards
Chances are you have received your share of "pre-approved" credit card offers in the mail, some with low introductory rates and other perks. Many of these solicitations urge you to accept "before the offer expires." Before you accept, shop around to get the best deal.
Credit Card Terms:
A credit card is a form of borrowing that often involves charges. Credit terms and conditions affect your overall cost. So it's wise to compare terms and fees before you agree to open a credit or charge card account. The following are some important terms to consider that generally must be disclosed in credit card applications or in solicitations that require no application.
Annual Percentage Rate: The APR is a measure of the cost of credit, expressed as a yearly rate. It also must be disclosed before you become obligated on the account and on your account statements. Some credit card plans allow the issuer to change your APR when interest rates or other economic indicators - called indexes - change. Because the rate change is linked to the index's performance, these plans are called "variable rate" programs.
Free Period: Also called a "grace period," a free period lets you avoid finance charges by paying your balance in full before the due date. Knowing whether a card gives you a free period is especially important if you plan to pay your account in full each month. Without a free period, the card issuer may impose a finance charge from the date you use your card or from the date each transaction is posted to your account. If your card includes a free period, the issuer must mail your bill at least 14 days before the due date so you'll have enough time to pay.
Annual Fees: Most issuers charge annual membership or participation fees. Transaction Fees and Other Charges: A card may include other costs. Some issuers charge a fee if you use the card to get a cash advance, make a late payment, or exceed your credit limit. Some charge a monthly fee whether or not you use the card.
Other Costs and Features:
Credit terms vary among issuers. When shopping for a card, think about how you plan to use it. If you expect to pay your bills in full each month, the annual fee and other charges may be more important than the periodic rate and the APR, if there is a grace period for purchases. However, if you use the cash advance feature, many cards do not permit a grace period for the amounts due - even if they have a grace period for purchases. So, it may still be wise to consider the APR and balance computation method. Also, if you plan to pay for purchases over time, the APR and the balance computation method are definitely major considerations.
You'll probably also want to consider if the credit limit is high enough, how widely the card is accepted, and the plan's services and features.
Useful Tips:
Keep these tips in mind when looking for or using a credit or charge card.
? Shop around for the plan that best fits your needs.
? Make sure you understand a plan's terms before you accept the card.
? Hold on to receipts to reconcile charges when your bill arrives.
? Protect your cards and account numbers to prevent unauthorized use.
? Draw a line through blank spaces on charge slips so the amount can't be changed.
? Keep a record - in a safe place separate from your cards - of your account numbers, expiration dates and the phone numbers of each issuer to report a loss quickly.
? Carry only the cards you think you'll use.

Credit Reports: Find out why you have been refused Credit.

2007-05-28T03:03:00.007-07:00

Credit Reports: Find out why you have been refused Credit.
You may already have 2 or more credit cards in your purse or wallet and you have just applied for a third and been declined. This can be very frustrating considering you pay off your other credit cards regularly and you are continually having your credit limit raised.
This is a common problem and the only way to find out more is by getting a copy of your Credit Report. Equifax and Experian are the two main credit reference companies in the UK and hold credit details of over 40 million people. Your file includes information about all your credit cards, loans, mortgages, bank account details, as well as any adverse bill payments or County Court Judgements against you.
When a Credit Provider asses your credit risk they will look at your Credit Report and make a decision based on your scoring. Your score is based on several factors. You may get more points for living in your address for more than 3 years or for having a home telephone, be married or for having children. Your age and profession can also help your score. The more points you have on your file the more chance you have of being approved for credit. The credit provider will use all this information coupled with your credit history to come to a decision. A Credit Providers scoring system is sensitive information so it's not easy to understand why you were refused credit.
By having access to your Credit Report you will be able to get a sense of why you possibly have not been granted Credit. Another important point is to check and see that everything on your report is correct. You are allowed to make corrections to your file. As most people don't get their Credit Report they never know what's on it or why they are being refused credit. If you fell behind in some of your bill payments you are also allowed to add a note explaining why you did. This may also improve your score.
With all the 0% credit cards on offer its worth mentioning that if you are continuously applying for these cards you could be damaging your credit score. The number of times you apply within a 6 to 12 month period can have an adverse effect on your score. If you have been refused credit, don't just move on to the next lender, find out as much as possible as to why it was declined before applying somewhere else.
You can find out more about your Credit Report at Experian and Equifax. It costs ฃ2 for a basic report.

Looking for that Low interest Credit Card?

2007-05-28T03:03:00.005-07:00

Looking for that Low interest Credit Card?
If you have been shopping around for a Low Interest Credit Card you will notice that the UK market is awash with Credit Card companies offering low rates to entice you to apply for their Cards.
There has never been a better time to consolidate your credit cards and get a far better interest rate. There are many offers out there but they all offer pretty much the same thing. The only thing that varies is the APR the 0% balance transfer period and possibly reward points for using the card.
With all these cards on offer you can be very selective and apply for a card that suits your needs and spending habits.
Looking to consolidate you existing credit cards?
Points to consider:
How long is the 0% balance transfer period for?
These can usually range between 6 and 9 months. These periods of 0% interest may seem attractive but make sure you know what the APR will revert to after the period comes to an end. Read the fine print as some credit card companies will expect you to spend a min amount to secure this low rate. Don't fall for this as there are many that do not expect you to spend anything.
Do you plan on clearing the balance within the 0% period?
If you do not plan on clearing the balance it may be worthwhile getting a card that has a low balance transfer rate for the life of the balance. Some credit cards will set a low interest rate until you pay off the balance in full, whether it takes 6 months or 6 years. This way you don't have to worry about paying a sudden increase in interest rates at the end of an introductory period.
Once you have established how to manage your credit card debt you will be in a much better position to choose the right credit card. The UK is in the grip of a huge debt epidemic and it's important to ensure that you are paying the least amount of interest on your debt. Also ensure that you are making your monthly payments. If you can afford it try and pay more than the minimum required every month as the longer it takes to pay off your card the more the credit card companies will make off you through interest charges.
Many people will transfer their credit card balances every time the 0% introductory period runs out. A term used for this is a "Card Tart" and as far as I know it's not illegal. The amount of times you apply for a credit card in a 12 month period may have an adverse effect on your credit rating so beware you are not damaging a perfectly good credit history by continuously applying for a 0% credit card.

Student Credit Cards

2007-05-28T03:03:00.003-07:00

Student Credit Cards
STUDENT CREDIT CARDS
With graduate debt averaging over ฃ12,000, the ability to spread the cost of further education using a student credit card is obviously attractive. Adding to their appeal is the fact that these cards are relatively easy to obtain. Unlike many standard credit cards, they are available to people who do not have a regular, minimum income and credit history. They often come with tempting offers including low rates for an introductory period, shopping discounts and free CDs. Flexing student plastic has the additional benefit of creating a credit history that can be used to support future loan and mortgage applications.
So, with no regular income and credit history, what exactly is the attraction of students for the credit card companies? Well, the fact that graduates can expect to earn, on average, ฃ400,000 more over their lifetime than the national average, means that financial institutions are eager to attract this extra earning potential. Banks and credit card providers know that the general public are reluctant to go through the hassle of changing accounts, so by attracting students early in their career, they are likely to stay with them for life.
Student credit cards can have drawbacks. If balances are not paid off in full each month, most cards aimed at students notch up higher interest charges than their regular counterparts. These additional charges often cancel out the benefits of store discounts or free CDs. Credit cards aimed at those in further education may not attract the useful bonuses that regular plastic does, for example air miles, cash back on purchases and interest-free periods.
Credit cards aren't free money. Flashing plastic creates a debt that must be managed alongside the repayment of tuition fees, bank overdraft and student loan repayments. Handled well, a student will benefit in the future from a good credit rating. Managed poorly, students may end up with a bad history that will adversely affect subsequent credit applications. It's also important to note that some standard credit cards do not require the holder to have a minimum regular income or credit history. Students working part time and holiday jobs may earn enough to apply for a range of standard cards. So, it is important for students to check out all suitable credit card deals, not just the ones aimed at people in further education.
A little research before signing on the dotted line can really pay off. By taking the time to compare the deals available on all suitable credit cards, interest repayments can be minimised and the benefits of holding a card maximised. And that really is good news for students.

Searching For A Low Interest Credit Card?

2007-05-28T03:03:00.001-07:00

Searching For A Low Interest Credit Card?
These days, people need to very carefully consider what type of credit card they will carry in their wallets. There are so many options out there, and each individual has different needs. Some of us tend to carry a balance, so we need a low interest credit card. Others pay off their card each month and so don't pay any interest. They are more concerned with having a credit card that has no annual fee.
These days, with so much competition between credit card companies, you can get so much more. You can get 0% introductory APRs, free balance transfers, and a whole host of exciting credit card rewards: travel, shopping, even points toward college tuition!
You get credit card offers in the mail every day. And you do need to make sure that you are using the credit card that is best for you. Instead of sifting through all those credit card offers in the mail, why not go online and check out the incredible offerings of credit card reward programs? In addition to getting the best credit card for you, as well as any perks that come with the card, you will earn a cash reward, just for signing up for your favorite low interest credit card online!
Credit card reward programs allow you to easily view and compare all of the best deals that the major, top of the line companies have to offer. And, when you decide to complete an application, you will receive a cash reward or free merchandise through the reward programs!
You see, in exchange for connecting consumers to opportunities to do business with them, credit car companies pay their affiliates a commission. Credit card rewards programs pass most of those commissions on to you. In return, you might enjoy the great deals offered by the rewards program on a regular basis and you may just refer your friends! The bottom line is that with credit card rewards programs you get the best low interest credit card for your needs, a generous cash reward, as well as opportunities to get free merchandise, other cash bonuses and really spectacular discounts and bargains.
The process is really very simple. You create an account with a rewards program, and in most cases you'll also get a cash bonus just for signing up. That's in addition to the cash reward you get for filling out a credit card application. Once enrolled with the rewards program, you will be able to browse the excellent deals available from well-established credit card companies. As you do so, note the cash reward you will receive as an incentive for signing up. When you make your choice, simply apply online. When you receive your credit card, the rewards program will credit your account for the amount of the cash reward.
You can redeem your cash reward or free merchandise by simply verifying your reward program account (usually by phone). Soon you will receive your cash bonus or free merchandise and enjoy your new low interest credit card!
You can learn more about getting credit card rewards at our credit card rewards section:

Credit Card Rates - Negotiating Rates with Your Credit Card Company

2007-05-28T03:02:00.002-07:00

Credit Card Rates - Negotiating Rates with Your Credit Card Company
Ok, let's face it, everybody hates high credit card rates, and they drain hard earned money out of your wallet. As a valued consumer, it is apparent that you learn how to negotiate to get the absolute best rate that you possibly can. The good news however is that it doesn't have to be a difficult or time-consuming process. In fact, it can be very easy indeed if you know what you're doing. In this article we will discuss the ins and outs of credit card negotiating to ensure that you get the best possible rate with the least amount of effort.
1. First and foremost, you should figure out if you even want to continue using your current credit card company. Are you pleased with the overall service that you are receiving? Do you like their benefits? If the answer is yes then you can proceed. If not, you should stop reading this article and start looking for a better company.
2. Second, you should evaluate your paying history and make sure that it is positive before you call to negotiate. If it is positive then you have power and if it isn't then you'll be negotiating from a position of weakness and that might not be good. Instead, you should wait until it is more positive before you call them to negotiate rates.
3. Third, if you have a good history then remember this when you call. In essence, you'll have extremely high negotiating power. The company needs your business in order to be successful and with clients they lose big time. Therefore, you should always display this "take them or leave them attitude" while conducting your negotiations.
4. Draft up a script and memorize it. It can be as simple as "Hello, my name is Bill and I have been a cardholder for X years and I consistently pay my bills on a time. Well recently I have been receiving all types of credit card offers from XYZ bank indicating that I qualify for an extremely low interest rate of X and am considering leaving you and going there if you can't offer me a lower rate. Is this something that you can help me with?
5. Practice, practice and practice some more with your script until you are completely and totally used to it. Once you are, contact the company. Read your script and see what happens.
6. If you get a hard nose customer service representative then don't threaten her. Be agreeable and ask to speak to his/her supervisor. If that is not possible, be nice to her and try again she may have some leeway. If you like your present company, you can even try negotiating interest rates, annual and even those yucky late fees.
7. However, if you're fed up, have an alternative company in the wings, and your current company won't budge with their rates then be willing to take your business elsewhere. After all, you hold the power so don't be afraid to use it! They key however is to not bluff but to follow through with your threat. Close the account, ask for them to send you notification in the mail, cancel the credit card and use another card.
Summary
You can be successful with the negotiating process if you follow the above mentioned tips. If your current company is unwilling to cooperate then you should simply take your business elsewhere. You're better off with another credit card company that values your savvy negotiating skills!

Some Truth About Credit

2007-05-28T02:59:00.005-07:00

Some Truth About Credit
Credit is currently and has been historically an integral component of our economy. Credit contribute a person's net worth, and financial power. No matter who you are or what type of business you are considering, credit is a vital component to be considered when developing your business idea and business plan.
Your credit history and status will always be a factor when lenders consider financing your entrepreneurial endeavor. No matter what type of loan, even loans for those who may struggle to acquire traditional financing, such as the SBA funded micro loan, will consider credit as one of the underwriting factors.
Because your credit history and status greatly impact your bankability and ability to acquire business funding, it behooves you to spend a significant amount of time developing and creating positive credit status and repairing poor credit history.
== personal note ==
When I got married I gifted my wife with a huge debt load and a toilet level credit status. Through diligence, patience, and time, I've been able to repair my history and develop credit status that has allowed us to finance vehicles, mortgage and refinance homes, and acquire construction financing. So I know you can repair your credit history and develop positive credit status but it takes patience, diligence, and a willingness to reprioritize your financial outlook.
== personal note ==
Now, here is the not-so-secret formula for developing good credit and repairing poor credit.
1. Time
-- You will need to plan ahead if you want to acquire business financing. It takes time for bad spots in your credit file to be removed. It also takes time to engage in the process of having them removed. You must also spend some time engaging in positive credit behavior.
2. Diligence
-- You will need to pay very careful attention to your financial details. If you want to start a business in two years, you'll need to begin keeping very careful and detail files concerning all of your credit practices. You'll need to be on top of payments and purchases you make and always be alert to avoid behavior that could be detrimental to your credit status.
3. Patience
-- Developing and repairing credit is a process that does not happen over night. Every time you challenge an item on your credit report it involves a process that requires patience. Every time you apply for credit, the application process will require patience. This goes hand in hand with time; developing good credit that you can invest in a business idea takes time and won't happen overnight so be patient. That's why you need to be passionate about your business idea. It must be able to stand the test of the financing and credit process.
4. Financial Wisdom
-- You must begin to start making sound financial decisions. Consider every financial decision you make as if it were contributing to you becoming a millionaire. Be wary of high interest commercial credit and instead attempt to acquire lower interest banking credit such as vehicle loans, mortgages, or home improvement loans. Consider each purchase you make in light of it's impact on your credit. If you make a give purchase will it inhibit you from making a loan payment and reducing debt. Begin to think in terms of debt reduction and expense reduction as ways to increase your wealth and credit status. Having less debt is just as important and financially beneficial as having extra spendable cash.
In the end, you need to take a long term view concerning funding and credit as you begin preparing to make your business dreams come true. It won't happen overnight but if you do it right and pay attention to the details, such as building sound credit, it will happen and you'll increase your wealth and power.

Get Your Credit Score To Soar In The Twinkling of An Eye

2007-05-28T02:59:00.003-07:00

Get Your Credit Score To Soar In The Twinkling of An Eye
Ever wonder how a creditor decides whether to grant you credit? For years, creditors have been using credit scoring systems to determine if you'd be a good risk for credit cards and auto loans. More recently, credit scoring has been used to help creditors evaluate your ability to repay home mortgage loans. Here's how credit scoring works in helping decide who gets credit -- and why.
What is credit scoring?Credit scoring is a system creditors use to help determine whether to give you credit.
Information about you and your credit experiences, such as your bill-paying history, the number and type of accounts you have, late payments, collection actions, outstanding debt, and the age of your accounts, is collected from your credit application and your credit report. Using a statistical program, creditors compare this information to the credit performance of consumers with similar profiles. A credit scoring system awards points for each factor that helps predict who is most likely to repay a debt. A total number of points -- a credit score -- helps predict how creditworthy you are, that is, how likely it is that you will repay a loan and make the payments when due.
Because your credit report is an important part of many credit scoring systems, it is very important to make sure it's accurate before you submit a credit application. To get copies of your report, contact the three major credit reporting agencies:
Equifax: (800) 685-1111
Experian (formerly TRW): (888) EXPERIAN (397-3742)
Trans Union: (800) 916-8800
These agencies may charge you up to $9.00 for your credit report.
Why is credit scoring used?Credit scoring is based on real data and statistics, so it usually is more reliable than subjective or judgmental methods. It treats all applicants objectively. Judgmental methods typically rely on criteria that are not systematically tested and can vary when applied by different individuals.
How is a credit scoring model developed?To develop a model, a creditor selects a random sample of its customers, or a sample of similar customers if their sample is not large enough, and analyzes it statistically to identify characteristics that relate to creditworthiness. Then, each of these factors is assigned a weight based on how strong a predictor it is of who would be a good credit risk. Each creditor may use its own credit scoring model, different scoring models for different types of credit, or a generic model developed by a credit scoring company.
Under the Equal Credit Opportunity Act, a credit scoring system may not use certain characteristics like -- race, sex, marital status, national origin, or religion -- as factors. However, creditors are allowed to use age in properly designed scoring systems. But any scoring system that includes age must give equal treatment to elderly applicants.
What can I do to improve my score?Credit scoring models are complex and often vary among creditors and for different types of credit. If one factor changes, your score may change -- but improvement generally depends on how that factor relates to other factors considered by the model. Only the creditor can explain what might improve your score under the particular model used to evaluate your credit application.
Nevertheless, scoring models generally evaluate the following types of information in your credit report:
Have you paid your bills on time? Payment history typically is a significant factor. It is likely that your score will be affected negatively if you have paid bills late, had an account referred to collections, or declared bankruptcy, if that history is reflected on your credit report.
What is your outstanding debt? Many scoring models evaluate the amount of debt you have compared to your credit limits. If the amount you owe is close to your credit limit, that is likely to have a negative effect on your score.
How long is your credit history? Generally, models consider the length of your credit track record. An insufficient credit history may have an effect on your score, but that can be offset by other factors, such as timely payments and low balances.
Have you applied for new credit recently? Many scoring models consider whether you have applied for credit recently by looking at "inquiries" on your credit report when you apply for credit. If you have applied for too many new accounts recently, that may negatively affect your score. However, not all inquiries are counted. Inquiries by creditors who are monitoring your account or looking at credit reports to make "prescreened" credit offers are not counted.
How many and what types of credit accounts do you have? Although it is generally good to have established credit accounts, too many credit card accounts may have a negative effect on your score. In addition, many models consider the type of credit accounts you have. For example, under some scoring models, loans from finance companies may negatively affect your credit score.
Scoring models may be based on more than just information in your credit report. For example, the model may consider information from your credit application as well: your job or occupation, length of employment, or whether you own a home.
To improve your credit score under most models, concentrate on paying your bills on time, paying down outstanding balances, and not taking on new debt. It's likely to take some time to improve your score significantly.
How reliable is the credit scoring system?Credit scoring systems enable creditors to evaluate millions of applicants consistently and impartially on many different characteristics. But to be statistically valid, credit scoring systems must be based on a big enough sample. Remember that these systems generally vary from creditor to creditor.
Although you may think such a system is arbitrary or impersonal, it can help make decisions faster, more accurately, and more impartially than individuals when it is properly designed. And many creditors design their systems so that in marginal cases, applicants whose scores are not high enough to pass easily or are low enough to fail absolutely are referred to a credit manager who decides whether the company or lender will extend credit. This may allow for discussion and negotiation between the credit manager and the consumer.
What happens if you are denied credit or don't get the terms you want?If you are denied credit, the Equal Credit Opportunity Act requires that the creditor give you a notice that tells you the specific reasons your application was rejected or the fact that you have the right to learn the reasons if you ask within 60 days. Indefinite and vague reasons for denial are illegal, so ask the creditor to be specific. Acceptable reasons include: "Your income was low" or "You haven't been employed long enough." Unacceptable reasons include: "You didn't meet our minimum standards" or "You didn't receive enough points on our credit scoring system."
If a creditor says you were denied credit because you are too near your credit limits on your charge cards or you have too many credit card accounts, you may want to reapply after paying down your balances or closing some accounts. Credit scoring systems consider updated information and change over time.
Sometimes you can be denied credit because of information from a credit report. If so, the Fair Credit Reporting Act requires the creditor to give you the name, address and phone number of the credit reporting agency that supplied the information. You should contact that agency to find out what your report said. This information is free if you request it within 60 days of being turned down for credit. The credit reporting agency can tell you what's in your report, but only the creditor can tell you why your application was denied.
If you've been denied credit, or didn't get the rate or credit terms you want, ask the creditor if a credit scoring system was used. If so, ask what characteristics or factors were used in that system, and the best ways to improve your application. If you get credit, ask the creditor whether you are getting the best rate and terms available and, if not, why. If you are not offered the best rate available because of inaccuracies in your credit report, be sure to dispute the inaccurate information in your credit report.

Like It Or Not, You Have A Score To Settle!

2007-05-28T02:59:00.001-07:00

Like It Or Not, You Have A Score To Settle!
Like It Or Not, You Have A Score To Settle! (Part 1 of 2 on Credit Scoring)
Just when most people finish with school and can stop worrying about test scores, there's a new kind of scoring that enters the picture. It's called credit scoring. And, its impact on your financial future can mean more to you than a college degree.
You may never know your precise credit score, but you need to know if you're at risk!
Credit Scoring ... Why It's So Important:
Ever wonder how a creditor decides whether to grant you credit? For years, creditors have been using credit scoring systems to determine if you'd be a good risk for credit cards and auto loans. More recently, credit scoring has been used to help creditors evaluate your ability to repay home mortgage loans.
Precisely what is credit scoring?
Credit scoring is a system creditors use to help determine whether to give you credit. Information about you and your credit experiences, such as bill-paying history, the number and type of accounts you have, late payments, collection actions, outstanding debt, and age of your accounts is collected from credit applications and your credit report.
Using a statistical program, creditors compare this information to the credit performance of consumers with similar profiles. A credit scoring system awards points for each factor that helps predict who is most likely to repay a debt. Total number of points (credit score) helps predict how creditworthy you are; how likely it is that you will repay a loan and make payments when due.
Why is credit scoring used?
Credit scoring is based on real data and statistics, so it usually is more reliable than subjective or judgmental methods. It treats all applications objectively. Judgmental methods typically rely on criteria that are not systematically tested and can vary when applied by different individuals.
To develop a model, a creditor selects a random sample of its customers (or a sample of similar customers if their sample is not large enough), and analyzes it statistically to identify characteristics that relate to creditworthiness. Then, each of these factors is assigned a weight based on how strong a predictor it is of who would be a good credit risk.
Each creditor may use its own credit scoring model, different scoring models for different types of credit, or a generic model developed by a credit scoring company.
How reliable is the credit scoring system?
Credit scoring systems enable creditors to evaluate millions of applicants consistently and impartially on many different characteristics. But to be statistically valid, credit scoring systems must be based on a big enough sample. Remember that these systems generally very from creditor to creditor.
Although you may think such a system is arbitrary or impersonal, it can help make decisions faster, more accurately, and more impartially than individuals when it is properly designed.
In fact, many creditors design their systems so that, in marginal cases, applicants whose scores are not high enough to pass easily, or are low enough to fail absolutely are referred to a credit manager who decides whether the company or lender will extend credit. This may allow for discussion and negotiation between the credit manager and the consumer.
What happens if you are denied credit or don't get the terms you want?
For the answer to that crucial question and how to improve your credit score, be sure to read Part II of "Like It Or Not, You Have A Score To Settle."
***************************************************************************************************************************************************************************************************
Like It Or Not, You Have A Score To Settle!
(Part 2 of 2 on Credit Scoring)
In part 1, we covered the basics about credit scoring ? what it is and how it is calculated. It's time to address the critical question ...
What happens if you are denied credit or don't get the terms you want?
The Equal Credit Opportunity Act requires that the creditor give you a notice either with the specific reasons your application was rejected, or stating that you have the right to learn the reasons if you ask within 60 days.
NOTE: Indefinite and vague reasons for denial are illegal, so ask the creditor to be specific.
If you were denied credit because you are too near you credit limits on your charge cards, or you have too many credit card accounts, you may want to reapply after paying down your balances or closing some accounts. Credit scoring systems consider updated information and change over time.
You also can be denied credit because of information from a credit report. If so, the Fair Credit Reporting Act requires the creditor to give you the name, address and phone number of the credit reporting agency that supplied the information. You should contact that agency to find out what your report contains.
NOTE: This information is free if you request it within 60 days of being turned down for credit. The credit reporting agency can tell you what's in your report, but only the creditor can tell you why your application was denied.
If you've been denied credit, or didn't get the rate or credit terms you want, ask the creditor if a credit scoring system was used. Be sure to ask what characteristics or factors were used in that system, and the best ways to improve you application.
If you get credit, ask the creditor whether you are getting the best rate and terms available and, if not, why. If you are not offered the best rate available because of inaccuracies in your credit report, be sure to dispute the inaccurate information in your credit report.
Under the Equal Credit Opportunity Act, a credit scoring system may not use certain characteristics like: Race, Sex, Marital status, National origin, or Religion. However, creditors are allowed to use age in properly designed scoring systems. But any scoring system that includes age must give equal treatment to elderly applicants.
What can I do to improve my score?
Credit scoring models are complex and often vary among creditors, and for different types of credit. If one factor changes, your score may change. But improvement generally depends on how that factor relates to other factors considered by the model.
NOTE: Only the creditor can explain what might improve your score under the particular model used to evaluate your credit application.
Nevertheless, scoring models generally evaluate the following types of information in your credit report:
ท Have you paid your bills on time? Payment history is a significant factor. It is likely that your score will be affected negatively if you have paid bills late, had an account referred to collections, or declared bankruptcy, if that history is reflected on your credit report.
ท What is your outstanding debt? Many scoring models evaluate the amount of debt you have compared to your credit limits. If the amount you owe is close to your credit limit, that is likely to have a negative effect on your score.
ท How long is your credit history? Generally, models consider the length of your credit track record. An insufficient credit history may have an effect on your score, but that can be offset by other factors, such as timely payment and low balances.
ท Have you applied for new credit recently? Many scoring models look at inquiries" on your credit report when you apply for credit. If you have applied for too many new accounts recently, that may negatively affect your score. However, not all inquiries are counted. Inquiries by creditors who are monitoring your account or looking at credit reports to make "prescreened" credit offers are not counted.
ท How many and what type of credit accounts do you have? Although it is generally good to have established credit accounts, too many credit card accounts may have a negative effect on your score. In addition, many models consider the type of credit accounts you have. For example, under some scoring models, loans form finance companies may negatively affect your credit score.
Scoring models may be based on more than just information in your credit report. For example, the model may consider information from your credit application as well: your job or occupation, length of employment, or whether you own a home.

Give Yourself Credit

2007-05-28T02:58:00.003-07:00

Give Yourself Credit
The Beginning of the Credit Card Era
In 1951, Diners Club issued the first credit card to 200 customers who could use it at 27 restaurants in New York City. From that modest beginning, credit cards have become an indispensable part of modern life. Consumers rely on credit cards to help them achieve their lifestyle goals by letting them take advantage of special bargains, spread payments out over several months, and provide cash in emergencies. Credit cards have become so widespread that they are often accepted as a piece of primary identification.
Getting the most from your credit cards involves four main steps:
Use your credit cards wisely.Protect yourself against fraud.Review your credit history regularly.Get the right card for your needs.
Use your credit cards wiselyFollow these simple tips to get the most from your card.
Tips:
Pay your credit card bills on time. This is the single most important thing you can do to preserve and enhance your credit rating. Always pay at least your minimum payment and allow time for your payment to reach the company if you are using the mail.
If possible, pay off your balance in full each month. If this is not possible, then make as large a payment as you can comfortably afford. Paying off or paying down your balance is a sound financial move-one that will save you money on interest charges.
If you can't pay off your balance in full, then slow down on your credit card use for the next while. Take time to step back and have a careful look at how much you earn and how much you spend each month. A little budgeting can save you big money down the road.
Check your statement carefully each month. Review your statement carefully. Do all the charges look correct? Have any required credits been applied? Are there any unusual or unexpected charges? Your credit card company will correct legitimate errors, but only if you bring them to their attention in a timely manner before you pay your bill.
Transfer your balance to a card with a lower interest rate. If you have two or more credit cards with outstanding balances, consider moving the outstanding balances to the card with the lowest interest rate. You will save money each month and simplify your record keeping by receiving only one bill.
Negotiate for a lower rate with your credit card company. If you have a good credit history, you are a valuable asset to your credit card company. Call them and seek ways to lower your interest rate. This is often possible, but never advertised. If the interest rate you are currently paying is very high, imply you may cancel the card and go with a competitor unless they adjust your rate downward. It doesn't hurt to ask, and you may be surprised at the results.
Protect yourself against fraudWhile credit card fraud is a problem, here are a few simple steps you can take to greatly reduce the risk of becoming a victim.
Tips:
Sign new cards immediately. When you receive your new or replacement card in the mail, sign it, in ink, right away. If it is a replacement card, destroy the old card by cutting it into many small pieces.
Shred old credit card receipts. You can purchase an inexpensive paper shredder at an office supply store. All old receipts with your credit card number and any unneeded documents with your social insurance number or other sensitive personal information should be shredded before disposal. This prevents the common practice of criminals going through the trash to find receipts and stealing your identity
Never fax your credit card number. Your credit card number can lie for hours in the fax basket at the other end. Anyone passing by can record your number and begin to use your card number fraudulently. It is even possible for criminals to intercept your credit card number while the fax is in transmission.
Use caution when giving your credit card number out on the phone or on the Internet. Only give out your credit card number on telephone calls you initiate to business or organizations you trust. Never give your number out to callers who call unannounced, no matter how legitimate the call sounds.
On the Internet, look for an Internet address that begins https:\. The "s" indicates that it is a secure connection and a small padlock symbol should appear in the bottom right hand corner of your screen, indicating it is safe to transmit your credit card number.
Call your credit card company instantly if you suspect trouble. All credit card companies have 24 hour lost and stolen help lines. If you lose your wallet or purse or have it stolen, call without delay! Much fraud happens within the first hour or two, before the victim realizes the cards are missing. Your credit card company will block your cards from being used and stop you from being responsible for any charges thieves incur.
Take advantage of any security features your card offers. Many newer cards have the option of including your photograph on the card. This is excellent protection and is highly recommended.
Review your credit history regularly After you have obtained the best credit card, and are using it wisely, review your credit history on a regular basis. This helps ensure your history is accurate and that any issues have been resolved to your satisfaction.
North America has three national credit-reporting bureaus. Your credit rating is held at one or more of these bureaus. When checking on your rating, be sure to contact all three, as your rating may be held on file at more than one bureau. The three national credit bureaus are Equifax, Experian, and Trans Union. Check the Yellow Pages, under Credit to find the numbers in your area.
Get the right cardWith all the choices in cards available, chances are good,very good, you can find a better card for your needs. Today's cards can save you money, offer better features, and even support a cause you believe in. Here are some tips on finding the right card and where to check that you have the best card for your needs.
Tips:
4 Be alert for companies offering a great interest rate for transferring your existing balance to their card. Usually these rates are only in effect for a short time, often six months. At the end of this time, the rate can revert to a much higher permanent rate. Keep your eye on the Annual Percentage Rate (APR); this is the figure that counts in the long run.
Lower is better: read the fine print and find the Annual Percentage Rate (APR). This is the interest rate the companies charge you if you carry a balance. You want the lowest rate possible; as each percentage point drop will save you money on the months you have an outstanding balance.
Nothing can be better: Try for a credit card that does not charge an annual fee. Many credit cards charge you a fee each year to use their cards. While this may be offset by other benefits the card may offer, you can find cards that do not charge this annual fee. Why pay for the privilege of using a credit card when you don't have to?
Explore the options: Today's cards offer a wide range of excellent features, including frequent flier points, programs that bank points toward a new car, and cards that support charitable organizations. Other options worth having include car rental insurance coverage, trip cancellation coverage, and extended warranty coverage.

Special Credit Information for Married Couples

2007-05-28T02:58:00.001-07:00

Special Credit Information for Married Couples
If you are married, establish separate credit accounts.
Try to finance real estate in just one partner's name to increase your investment financing potential.
Avoid joint credit, which limits financing possibilities for both individuals rather than one at a time. Accounts in one partner's name only count against that individual's credit.
In other words, when applying for an individual loan, the spouse's accounts won't be listed as monthly expenses and this makes it easier to qualify for a loan.
When beginning your real estate investment business, keep in mind that double income helps qualify you for higher mortgage payments.

Dont Fall for Credit Repair Scams

2007-05-28T02:57:00.005-07:00

Dont Fall for Credit Repair Scams
We've all seen the ads on television or in magazines, shouting, "Erase bad debt!" or "Remove negative entries from your credit report!" If you're a person suffering from a less-than-stellar credit rating, those headlines may seem like the answer to a prayer.
The only problems is, those programs don't work, and to add insult to injury, you'll find yourself paying hefty fees to those companies, only to end up right where you started, or worse. Sometimes, what is couched as a credit repair program may actually be an attempt to steal your identity by gaining information about your social security number, bank accounts, and credit cards.
Here's how the credit repair scam generally works:
First, the company will contact the various credit bureaus and tell them that the negative information contained in your files is false. Since they want to accurately reflect your credit information, the credit bureaus will temporarily remove the negative information while they investigate the claims. Meanwhile, the scammer sends you a copy of your credit file, showing that the negative information has been removed, claiming that your credit history has now been repaired.
It will seem like a miracle, until you learn that as soon as the credit bureaus have completed their investigation, any accurate negative information will be returned to your credit report, and you'll be back where you started, minus the fees that you paid to the scammer.
The key concept to remember when it comes to your credit report is that accurate entries will stay on that report for seven years from the time they're reported to the credit agencies. Bankruptcies stay on a report for fourteen years.
There are many honest companies that can help you with debt problems. But how can you know if a company is legitimate? First, scammers will ask for their money up front, while legitimate credit repair companies can't require payment from their clients until they've performed the services they've promised. In many states, they must also give you a detailed written contract, clearly explaining your legal rights and giving you the option to cancel within three days.
The bottom line: know who you're dealing with when it comes to trying to repair your credit. Mistakes can cost you dearly, doing even more damage to your credit, creating even more debt problems, and sometimes costing large amounts of money.

Credit Help for Real Estate Financing: Five Categories of Your Credit Score

2007-05-28T02:57:00.003-07:00

Credit Help for Real Estate Financing: Five Categories of Your Credit Score
1. Payment History -- 35%
The number of accounts paid as agreed and a good payment history give you a higher score.
Negative points lower credit scores because of 30 days, 60 days, and 90 days late on any debt. The dollar amount of these delinquencies also impacts credit scores. Severity of delinquency, how long past due, and number of delinquencies are nasty remarks on some credit reports. The older these derogatory items are, the less impact they have on credit scores. You do not want any present delinquent accounts when applying for a real estate loan.
Never, ever pay a mortgage payment more than 30 days late. Lenders do not like to see any delinquencies on real estate loans.
Adverse public records, such as bankruptcy, judgments, suits, liens, and wage attachments negatively dominate credit history. Any of these items cleared up helps improve a credit score, unless the item is aged. The older the derogatory entry, the less the impact. Any activity on a particular item makes the item update and therefore, remain on the report for another seven years. So, if a derogatory item is more than four or five years old, don't bother with it.
Collection items unfavorably shape credit payment history. The more age a collection account has, the less its consequence. Most mortgage companies require that collection accounts be cleared before lending. If this is your problem, see "Help with Collections" later in section six.
2. Proportional Amounts Owed -- 30%
The amount owed on a credit line compared to the available credit is termed the proportional amount owed. With a credit card limit of $5,000, the score will be higher if less than $2,500 is owed. Even better is to owe less than 1/3rd of the available credit or less than $1501. To have the highest proportional amounts owed scoring factor, owing less than ten percent of the available balance gives you the best possible rating. On the other hand, owing over $4,500 on an account with a limit of $5,000 lowers your score significantly, especially if you have too many credit cards and other loans with high balances compared to available balances.
Tip: Call your creditor and ask them to raise your available credit as long as you don't use this credit. This raises your proportional amount owed scoring factor.
To raise your credit score dramatically and quickly, pay down as much as possible on each credit line instead of paying off one credit card at a time. If a credit card is totally paid off, it does not compute in the proportional amount owed; therefore your rating does not benefit from paying balances in full. On the contrary, paying balances in full takes the account out of the equation and you don't get higher points for the low proportional amount owed.
3. Length of Credit History -- 15%
Any account over twelve months with a good payment history helps a credit score if the balance is not too high compared to the available credit. Six months is the minimum length of time to establish credit. The time since accounts opened and the time since account activity are factored into the length of credit history.
4. New Credit -- 10%
Whenever you apply for a new credit line, your score receives a negative hit. The more inquiries you generate, the lower your score. Obtaining new credit lowers your credit score. We only apply for credit when applying for mortgages. Every time we get a new mortgage, our credit scores go down.
Never finance a new car or get a new line of credit when you are getting ready to finance property. Wait until after closing to apply for further financing. Be aware that after your new loan shows up on your credit report, your financing abilities shrink. If you need credit funds for any reason, including renovation costs for your new house, apply for this after closing your property purchase.
5. Types of Credit Used -- 10%
The different types of loans taken out by consumers affect credit scores. Credit assessors view mortgage accounts more favorably than consumer finance accounts. Too many installment loans, auto loans, and department store credit cards affect credit negatively. To improve your credit score, pay off installment loans and consumer finance company accounts after you have lowered your proportional amounts owed. Then pay off your department store retail accounts. Keep balances as low as possible on home equity lines of credit because they often count as consumer finance accounts instead of mortgages. Achieve higher credit scores by having only mortgage accounts and a couple of major credit cards with low balances.
Note: In addition to credit scores, lenders consider length of time at residence and employment as well as income and education.
Do You Need a Credit Score of 700?
Don't believe it! We have so many loans; our scores are in the mid 600s, but we buy and sell property all the time. Even with a perfect payment history, we can't get our scores up because we have so many real estate loans with high balances remaining. We often need to get "B" loans instead of "A" loans, which means we pay higher tax-deductible interest, points, and fees.

Credit Help for Real Estate Financing: Credit Scores

2007-05-28T02:57:00.001-07:00

Credit Help for Real Estate Financing: Credit Scores
When you buy real estate, lenders run all of the "big three" credit bureau reports. Each credit reporting agency lists your credit history as supplied to them by the individual lenders and includes governmental records. Each report assigns a credit score number to you. The credit scores reflect your theoretical risk of default to the lending institutions.
Software developed by Fair Isaac and Company generates your "FICO score." Experian uses a system called Fair Isaac Risk Model, a computer program which rates you with a score according to Experian's information. Equifax bases scores on BEACON programs and TransUnion bases scores on EMPIRICA models.
Your Baseline
You have three credit scores, often called FICO scores, one from each credit bureau. The lender takes the middle score as your baseline. Lenders have different standards, but generally a "C" score is around 500 to 600, a "B" is around 600 to 680, and an "A-" is above 680. Over 700 is the magical number that gets you the attention you desire. If your score is under 500, find someone to privately finance for you or a partner with good credit while you work on improving your score.
How Lenders Rate You
Credit score Available mortgage financing720 - 800 Superb! You get what you want700 - 719 Wonderful! You get top rates & terms680 - 699 Good! You get good rates & terms660 - 679 All right. You pay higher costs & rates640 - 659 Okay score if good income620 - 639 Weak. You need good income & some money600 - 619 Poor. Use creative loan broker & pay more loan costs580 - 599 Almost impossible without large down paymentUnder 580 Work on fixing credit without delay
What Does Not Count In Your Credit Score
The scoring model doesn't compute:
Age & genderRaceWhether you own a home or rentLength of time at your current addressJob or length of employment at your jobIncomeEducationMarital statusWhether or not you've been turned down for credit.
Real estate lenders don't just consider your credit score when you apply for mortgage financing. Understanding your credit score helps you with this one part of your mortgage requirements.
Copyright ฉ 2005 Jeanette J. Fisher - All Rights Reserved.

Credit Repair Companies and Credit Counseling

2007-05-28T02:56:00.001-07:00

Credit Repair Companies and Credit Counseling
Let's be crystal clear, right up front. Paying someone to "fix" your credit is a waste of your time and money, since the negative issues that are temporarily removed from your file will only reappear again in a couple of months.
Be careful with credit repair scams.
Most "credit repair" companies really don't help. In fact, you can improve your credit more effectively on your own. By using credit repair companies, you may also be opening yourself up to identity theft, unsolicited emails, and direct mailings. Protect yourself; don't ever share your personal information with strangers or give up your right to handle your own financial affairs as you see fit.
Another important point: credit counselors only promise to get you out of debt, not to improve your credit. Some companies will have you send them a check every month, out of which they're supposed to pay your creditors for you. However, some credit counselors will often pay your bills late, which means that your credit report soon becomes filled with "over 30 days late" notations and your credit score drops even lower than it was.
"Debt negotiators," posing as non-profit organizations, can ruin your credit even further, advising you not to pay your credit card bills at all. They also charge upfront fees, maintenance fees, and monthly fees, all of which are supposed to be placed in a "trust" account. Then, after many months have passed, debt negotiators finally convince creditors to settle for less money than was owed, making yours an "uncollectible account."
That tactic not only ruins your credit, due to the many "over 90 days late" remarks and collections notations, but all the money you supposedly saved -- which was actually money you owed -- will be considered as income by the IRS! In other words, if you owed $20,000 and settled for $12,000, you'd be required to list the $8,000 difference as income!
Credit repair companies promise to help clear up your credit problems. They write letters to credit bureaus, stating that various listed information is false, so the agencies will remove that information while they investigate your account. During that time, the credit repair company sends you a clean credit report, thereby giving you the false impression that you now have good credit. But after you've paid off the credit repair company, you'll discover that all the negative items will soon reappear on your report.
Remember: only incorrect items must be removed from your credit report if they're proven to be false. If the black marks on your credit report are correct, no one can have them removed, regardless of what credit repair companies may try to tell you. Working with collectors to remove negative remarks is possible, but that's another article.
Some credit repair agencies can probably do a reputable job removing items that are truly incorrect, such as: items after a bankruptcy that should have been removed, double items, children's items on parents' reports, and paid-off items that still show past due. Some people really just don't like dealing with this kind of thing, so a reputable credit restoration company can help with these problems.
If you're seeking legitimate financial help to buy a home, the best place to turn is to a mortgage broker. They're the ones who can offer you the best FREE advice for settling credit disputes and problems, so when you find yourself in difficulty, consider using a mortgage broker as your credit counselor.
(c) Copyright 2004, Jeanette J. Fisher. All rights reserved.

How to Get Credit Reporting Agencies to Help You

2007-05-28T02:52:00.001-07:00

How to Get Credit Reporting Agencies to Help You
The process of clearing credit can be laborious and frustrating. Understanding your rights empowers you and saves you time and effort. By employing the following tips, you can enlist the help of credit reporting agencies (CRAs) as you work to improve your credit rating.
A negative credit report hinders your quest for financing a house. You will have to do a lot of tedious work to clear up any mistakes in your credit report, but remember that CRAs are required by law to protect your rights. They must remove undocumented information on your report.
Once you receive your reports, you will be given a phone number to discuss your report with a real person. Your gentle manners and pleasant conversations with the credit bureau employees will motivate them to help you more than angry words. Remember, these people are just doing their job and they get yelled at day after day by frustrated consumers.
Double-D Line of Attack
Dispute Discrepancies and Document
Complete the dispute form provided with your credit report and write a letter for all discrepancies to both the creditor and the credit bureaus listing the item. Identify each error by their corresponding account number and state why it's wrong. Include a photocopy of your credit report with the errors circled with your dispute form and letters. Send copies of your supporting documents. Keep your letters in your computer in case you need to write again.
Document, document, document
Keep copies and records of all the dispute forms, letters, and supporting documents that you send. In extreme cases this proof is used by attorneys for settlement or in court.
Credit bureaus must investigate disputes within 30 days of receiving your complaints. Any item that is not verified as accurate by a creditor is supposed to be removed. However, the supposed creditors do not have to provide any supporting documentation. All they have to do is state that the account is reported accurately.
For this reason, after receiving your updated credit reports, check to see what actions were taken. If you still have erroneous information listed on your credit report, you need to start the entire process over again. At this point, take stronger action both with the original creditor and with the credit reporting agencies.
Copyright ฉ 2005 Jeanette J. Fisher - All Rights Reserved.
Jeanette Fisher, author of "Credit Help! Get the Credit You Need to Buy Real Estate," helps people buy their dream home or finance multiple investment properties. Jeanette teaches real estate investing and Design Psychology. For help with your credit or answers to your questions, visit the Real Estate Help Credit Center at http://www.recredithelp.com Subscribe to Credit Help! Tips. Send a blank email to CreditTips at reCreditHelp.com Get the credit you need to buy one house or twenty!

New Credit Advice: Dont Pay off Those Credit Cards!

2007-05-28T02:51:00.001-07:00

Credit needed for real estate mortgage financing differs from credit needed for consumer loans. If you need help getting a home mortgage, these credit tips will help you.
Contrary to what many credit advisors say, paying off credit cards each month is not always the best action to take. When making credit card payments, don't pay the balance in full each month -- let a little roll over. Carry a balance on your credit card every other month --as little as a dollar. Paying balances in full does not increase your credit score; paying balances in full may in fact lower your credit score. Accounts with zero balances do not compute significantly in your total score. For instance, a credit card with a perfect payment history and no balance will not raise your credit score as much as a credit card with a low balance. Any balance keeps the card active so it computes in your credit score.
You most likely have been advised to cut up your credit cards and close your accounts. Following this advice degrades many credit scores.
Canceling Credit Cards
Canceling credit cards can lower your credit score. Keep your longest-term credit card account open to show long-term credit history. If this account has prior late notations, negotiate with the creditor to drop negative reporting on your credit history file. Slowly close out newer accounts after they are paid off. Keep your best accounts open -- those paid on time or reporting "pays as agreed" and with the longest history.
Credit card companies may raise your rate if you cancel a card before it is paid off; it is best to keep accounts with outstanding balances open until you pay them off.
Perfect Balance of Credit
1. Mortgage over one year old with all payments on time
2. Visa Card or Master Card with less than 10% of available credit as balance due
3. Discover or American Express Card with less than 10% of available credit as balance due
4. Auto loan either paid off or paid down with low payments compared to monthly income.
Debt-to-Income Ratio
Credit scores do not reflect income -- credit bureaus do not have income reported to them. However, real estate lenders look at the consumer debt-to-income ratio -- the amount of monthly debts in relation to the amount of earnings. Consumer debt is more highly regarded/scores higher if total debt is under 20% of net income, or total monthly payments on all debts is less than 35% of monthly gross income.
Qualifying Ratios
Lenders want the total debt ratio (the percentage of total monthly payments, including the new mortgage, to income) to be less than 33% for a typical conventional mortgage. This means the new mortgage payment, credit card payments, and all other monthly debt payments should not equal more than about one-third of the monthly income.
Lenders want the mortgage debt ratio (the percentage of the new mortgage payment to income) to be less than 28%.
Non-prime loans have lower standards; some lenders allow debt-to-income ratios as high as 55%. Borrowers with less than perfect credit qualify more easily for a non-prime loan compared to an "A-paper" loan.
Once you total your monthly expenses and determine your debt ratio, you can estimate how much you can afford for a house payment. For example, if your income is around $3,000 per month, you can afford a home with payments around $1,000 per month (including taxes and insurance) with a conventional loan, if your other debt does not total more than 5% of your income.
For investors, these equations change. Lenders expect 10%-25% down on investment property and allow about 75% of the rental income to offset the debt ratio.
Understanding your credit helps you manage your credit so you can obtain real estate financing, either for the house of your dreams or for your financial future.
(c) Copyright 2005 Jeanette J. Fisher. All rights reserved.
Professor Jeanette Fisher is the author of "Credit Help! Get the Credit You Need to Buy Real Estate," "Doghouse to Dollhouse for Dollars: Using Design Psychology to Increase Real Estate Profits," and other books. Jeanette and her husband chose real estate investing to be able to care for their daughter with special needs. While buying and selling millions of dollars worth of real estate, the Fishers were forced into becoming credit experts.

10 Step Credit Repair Guide

2007-05-28T02:50:00.001-07:00

The process of clearing credit can be laborious and frustrating, but your efforts will be paid for in better financing. Your rights are protected by laws, but you need to take reasonable actions toward your goal of clearing credit discrepancies. You can get the credit reporting agencies to help you instead of hindering your excellent credit quest with these tips.
1. Order credit reports.
2. Check for discrepancies.
3. Note problems and discrepancies in your Credit Dispute Log.
4. Contact disputed companies by telephone. (Contact original debtors, not collectors.)
Log the telephone call with a brief summary of agreements.
Remember to record the name of the contact representative.
5. Follow up with certified letter to original company.
6. Write letters to collectors, dispute bill, send documentation of payment to original company.
7. Fill out dispute form provided by credit bureau.
8. Write separate letter for each disputed item to credit bureaus.
Send letters by certified mail.
Enclose copies of supporting documentation.
9. Use the number provided by the credit bureau and call for progress; have your reference number handy.
10. Keep comprehensive records in your Credit File.
These ten steps will help you finance your dreams.
Copyright (c) 2005 by Jeanette J. Fisher. All rights reserved.

14 Common Credit Mistakes

2007-05-28T02:49:00.001-07:00

Establishing credit and wisely managing your credit becomes easier when you know how. You'll feel empowered by taking knowledgeable steps towards good credit, and you'll be on your way to purchasing real estate and greater financial freedom.
If you plan to finance real estate, either as a home buyer or an investor, avoiding these common credit mistakes will help you with your credit score and save you money in loan costs.
14 Common Credit Mistakes
1. Using expensive or undesirable types of credit costs too much and is negatively scored.
2. Accumulating too many lines of credit or too many credit cards causes credit report remarks like "too much consumer credit."
3. Only paying the minimum due keeps balances too high.
4. Being maxed out on any credit card or line of credit causes deep drops in scores.
5. Taking cash advances costs higher interest and extra fees.
6. Exceeding limit and having to pay over-limit fees is a negative with creditors and causes "high proportional amounts owed" remarks on credit reports and subtracts credit score points.
7. Paying a day or more late causes unnecessary late fees and often increases interest rates.
8. Charging more than you can afford causes a snowball effect of amassing debt with no easy way to pay it off.
9. Letting someone else use your credit, such as co-signing a loan, raises your debt-to-income ratio and possibly adds "too many consumer accounts" on your credit report, which lowers your score.
10. Ignoring credit problems causes unnecessary negative impact. Talk to creditors before being late and make arrangements. This action heads off negative reporting to credit bureaus.
11. Failure to report address changes to creditors causes misplaced bills and late payments.
12. Using partial name, different names, initials instead of whole name, or forgetting Sr. or Jr. causes mix-ups. Use your full legal name to protect you from confusion with similarly named borrowers.
13. Failure to report name changes to creditors also causes confusion.
14. Not checking credit report frequently is one of the most common mistakes consumers make.
You can buy real estate with poor credit, but you will save thousands in loan costs if you maintain good credit. A bad credit report leaves home buyers with sub-prime loans which have higher point charges, prepayment penalties, and higher interest charges, which therefore cost more money.
For instance, a mortgage loan of $150,000, 30-year, fixed interest rate of about 5.72 percent costs around $870 a month. Poor credit scores raise the interest rate over 9 percent and the payments over $1,200.
As you see from these payment differences, good credit means that you can finance a more expensive house with the same income, or save $330 each month.
Credit Requirements for Mortgages
Credit needed to buy real estate is not the same as good credit. Besides your credit score, mortgage lenders consider your debt-to-income ratio and other credit matters, unlike other credit grantors. Your debt-to-income ratio is the comparison of mortgage payment, including taxes, interest, and insurance to your total gross monthly income. Real estate lenders also consider your employment qualifications and your overall debt ratios. Understanding the difference between good credit and the credit needed to obtain real estate financing helps you buy houses!
Avoiding credit mistakes helps you get strong credit and keeps your credit scores up.

Good Credit is King, When Qualifying for Mortgage Programs

2007-05-28T02:48:00.001-07:00

If you want to purchase a new home or refinance your current mortgage, be sure to check out the wide array of loan programs available. If you have less than excellent or even poor credit, you can still qualify for a loan. If you have outstanding credit, though, you are in the proverbial driver's seat, when it comes to selecting your loan program. Be sure to find a good mortgage consultant, and carefully explain exactly what you need. Here are just a couple of "outside-the-box" programs that come in handy for some people but require excellent credit ratings.
Stated loan programs are designed for a person whose income or assets fluctuate from month to month and year to year. Not many banks offer stated programs. Many people who need stated programs get turned down by not only banks but by inexperienced mortgage brokers who don't understand the breadth of the programs at their fingertips. So, you may have to enlighten them with your own insight by telling them this is the program you need.
Stated programs are for people who may not qualify for a conventional loan, because they do not meet income requirements a lender has. A prime example is someone who does not show all of her income on a W-2 tax return, for one reason or another. This person may make enough money to cover the mortgage payment, but she can't prove she makes it on paper. Lenders like to see two years of W-2 income. This proves to them that you consistently make enough money to pay back the loan. Now, it's important to note that this is a good credit program, and a lender will want someone with at least A-minus credit for approval. Here is where all that work to maintain your spartan credit record is going to pay off.
What the stated loan requires is all standard documents, except income verification. In other words, the loan officer is going to state your income on the application, and no proof is required. Please note that this program is not intended for someone who works at McDonalds to try to state that he makes $200,000 yearly, so he can get approved for a $400,000 loan. It is intended for people, like salesmen, whose income varies or for businessmen, who work on bonuses, which they may not receive until the next year. As long as the income is reasonable for the profession, no underwriter will ever question it. So, if you needed to make 60,000 yearly for approval, but you only show $54,000 on last year's W-2, your mortgage broker can get you a stated income program, and he will simply write $60,00 on the application. Don't worry, the lender won't ask for pay stubs or tax returns. Your credit rating speaks for itself. In other words, the lender sees that you have an excellent payment history on your other debts, so he is willing to take on a bit more risk.
A stated asset program works the same way, and good credit is required for approval in this program, too. Lenders require cash reserves, in order to cover several months of mortgage payments, in the event something goes wrong after the loan closes, like you lose your job or get hurt. This can be a problem for people who have no savings, stocks, or retirement accounts, which are all acceptable forms of reserves. If you fall into this category, you simply ask for a stated asset loan, and the mortgage broker will state enough assets on your loan application to appease the lender.
This seems fraudulent, you might say. It isn't, as long as you follow the guidelines set forth by the lenders. Remember, they created these programs, so they could loan more money. You'll pay, of course, because the lender will hit you with a premium on your rate, because the loan is more of a risk. So, instead of getting a 6% rate, you might get as high as 6.75%, but at least you'll get your loan.
There are many other loan programs that allow you to borrow more of the equity in the house, let's say up to 95% or even 100%, due to a great credit rating. Some programs allow for an improvement on your interest rate.
It's always important to ask your mortgage broker if there is some kind of incentive because you have A or A+ credit. Most lenders allow the mortgage broker to either give you the break in rate, or they'll give it to the broker in a cash commission. Many unscrupulous brokers will never mention the credit bonus to you, and they'll make up to .25% of the loan amount for themselves.
So, if you had a $200,000 loan, and the lender allowed a .25% interest reduction or commission to the broker, and the broker takes it, instead of giving it to you, that mortgage broker would make $500.00 extra dollars, which would be paid by the lender. Of course, if you had received the .25% better rate, your payment would decrease by about $30.00 each month and $360.00 each year. That's nearly $2,000 if you have the loan for five years that you would lose to a greedy mortgage broker. So, always ask for something, due to your excellent credit.

The Easy Way To Gain Access To Your Free Online Credit Report

2007-05-28T02:46:00.003-07:00

When you apply for credit, those lending you the money want to know if you are going to pay them back. One way they decide if you are a good risk is to see how you've dealt with other people's money. They find this information in your credit report.
Your credit is reported to three main credit bureaus and these bureaus then rate you. If you are planning to apply for credit, it would seem that knowing what is being said about you would be a good idea. This way, you can take care of any problems and be aware of them before you begin.
It's Easy
Getting your hands on your credit report is easy. All you need to do is call the number of the credit bureau and follow their directions:
Equifax Options P.O. Box 740123 Atlanta, GA 30374-0123 http://www.equifax.com
Experian Consumer Opt Out P.O. Box 919 Allen, TX 75013 http://www.experian.com
Trans Union Name Removal Option P.O. Box 97328 Jackson, MS 39288-7328 http://www.transunion.com
However, it is even easier to do online. Simply go to the listed website and get started. Here are a few things you will need:
# Full name ? this includes middle, maiden, Jr., Sr., and III, etc
# Social Security number ? you must have one in order to do this online
# Driver's license information ? your DL number plus state
# Current address and your address within the last five years ? if you have had more than one in the last five years, you will need to have each of them
# Date of birth
# Signature ? for online requests, you will have to type your name and follow their instructions
# Home telephone number
# Employer ? if you are employed
# Credit Card or Debit Card to pay the fee ? it is usually $8 to $10
Coming Free to Your Area Soon
Beginning in December 2004, you will be able to get a free yearly copy of your credit report. Then getting your credit report will be even easier. Instead of having to go to the three major bureaus, you will be able to go to a centralized source with a toll free number or a website.
Schedule for Phasing In Access to Free Credit Reports:
December 1, 2004: Alaska, Arizona, California, Colorado, Hawaii, Idaho, Montana, Nevada, New Mexico, Oregon, Utah, Washington, and Wyoming.
March 1, 2005: Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri, Nebraska, North Dakota, Ohio, South Dakota, and Wisconsin.
June 1, 2005: Alabama, Arkansas, Florida, Georgia, Kentucky, Louisiana, Mississippi, Oklahoma, South Carolina, Tennessee, and Texas.
September 1, 2005: Connecticut, Delaware, District of Columbia, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, North Carolina, Pennsylvania, Rhode Island, Vermont, Virginia, and West Virginia, Puerto Rico, and all U.S. territories.
Getting your credit report online is easy and getting easier all the time. It is in your best interest to check out your credit reports yearly so that you can check for errors, and recognize problems quickly enough to correct them.

5 Surefire Ways To Eliminate Credit Card Debt

2007-05-28T02:46:00.001-07:00

Do you have enormous credit card debt? You are certainly not alone. According to research, the average family in the United States has $7000 in credit card debt and pays about $1000 in interest each year! Throw in a late payment or two, or an over-the-limit charge, and that number skyrockets. Imagine what you could do with that $1000 if it weren't being spent on interest.
Let's imagine for a moment that you have $5000 debt on one credit card that is charging you 17.5% APR. Let's also imagine that you pay only the minimum due of $25/month on this card. Guess what? You will never pay it off! The interest alone on this card is $73/month!
That means that each month you get further and further into debt. By the time you have been paying on this $5000 for 10 years, assuming you have not used the card during this entire period of time, you will owe $20,385! That's over $15,000 in interest. If you triple your payment to $75, it will take you over 20 years.
So, what do you do? How do you get out of debt and use that money towards other necessities, savings, and investments? Here are a few simple methods that you can use without having to go to an expensive financial counselor.
Tip #1: Cut Up Your Cards
The very best way to reduce your credit card debt is to STOP using your credit cards! There is no need to have more than one card, so pick the one with the lowest interest rate and cut up the rest. The one you keep should be deemed an 'emergency card." These are true emergencies, not mere inconveniences. For instance, buying a new TV would not be an emergency, but renting a car in order to get to the bedside of a dying loved one would be. You can carry your emergency card with you, but don't make it too easy to use. One good suggestion is to cover the card tape and paper and write on it: For Emergencies Only.
Tip #2: Move Your Debt
If you have more than one credit card payment, you may want to consider moving debt from a card with a higher APR to one with a lower APR. This will lower the amount of money you are spending towards the interest and get you out of debt faster.
Tip #3: Use the Snowball Principle
List all of your credit card debts, and the amount you are paying each month. Pay off the lowest amount first. Then use that money to start paying off the second lowest amount. And then the next and the next. Let's look at an example.
If you have a $7000, $5000, and $2000 card with payments of $150, $125, and $100, you will finish paying off the $2000 card first. Once it is paid off, you take that $100 and put it towards the $5000 credit card. That means you are now paying $225/month. You have increased your payments which will pay off that credit card sooner and will have you paying a lot less in interest. Once that is paid off, you apply the $225 to the $7000 card, making your monthly payment $375. This will greatly accelerate the payment of this card, reducing your interest payments even further. When everything is paid off, you now have $375/month extra to put towards savings or investments!
Tip #4: Prioritize Your Debt Repayment
One of the best ways to pay off your debts is to get rid of the highest interest payment first. Looking back at the snowball example, you took the lowest and paid it first. If, however, the $2000 card had the lowest interest rate, you would want to pay off the card with the highest rate first. This will save you much more in interest payments.
If the math gets too hard here, don't despair. There are many places on the Internet where you can find good debt reduction calculators. It is then just a matter of punching in your numbers and reading the report.
Tip #5: Consider Consolidation
If you own a home, you may want to consider consolidating your debt using a home equity loan. Since a home loan is a secured loan (they can take away your house if you don't pay) you have a much lower interest rate than you do on your credit cards. Paying a lower interest rate is always a good thing! Not only that, but the interest you pay on your home loan is tax deductible. This is NOT true for credit cards.
By following these tips, anyone can take control of and completely eliminate credit card debt.

7 Surefire Ways To Repair Bad Credit

2007-05-28T02:43:00.003-07:00

Do you have a poor credit rating? If so, you are one of tens of thousands of Americans with the same problem. In fact, it seems that this has become a national 'disease.' And just what do people need that have a disease? They need a cure.
Here are some sure-fire solutions to ' repair bad credit '. Keep in mind, like most 'diseases,' credit repair can take some time, but complete healing is possible.
The First Step
The first thing you need to do is find out what is being reported about you. This is easy and inexpensive. For under $10, you can get your credit report from one of the three main credit reporting companies: Equifax, Experian, or TransUnion. Keep in mind however, that if you have recently been denied credit, you can get a free report from the same credit bureau the lender used to reject you as long as you do so within 30 days.
What You Don't Need
You don't need a repair clinic. Why? There is no legal way to 'repair' your credit. Those that claim to know loopholes and shortcuts are merely out for your money. They may even get you into legal trouble by having you fudge the facts or creating a whole new file for you. Anything legal that a clinic can do, you can do just as easily and without the cost of 'professional' help.
Further Steps to Take
1. Stop using your credit cards immediately. Put them somewhere where they will not tempt you. You may consider keeping at least one card for emergency purposes. Additionally, with poor credit, you may find it more difficult to get a credit card in the future. If you keep at least one account open, then you won't have to worry about applying.
2. Be Honest With Yourself. Taking a good hard look at your financial situation, particularly if it isn't good, can be very difficult. Yet, to get out debt you have to fully understand what the situation is.
3. Find the Errors. Believe it or not, up to 40% of all credit reports have errors in them. If you find that your credit report shows something that is not true, you need to write to them with all the details. Be sure to use certified mail so that you can keep track of who you wrote to, when you wrote, and who received the mail on the credit bureau's end. Then ask the credit bureau to send a corrected report to anyone who has requested a report on you in the last 6 months.
4. Find the Omissions. By law, you are allowed to add information to your report that you believe will help your rating. This might be additional information about a repayment of a loan, good credit you have with companies that do not report to the credit bureau, or salary increases.
5. You Must Have a Plan. Whether you determine to pay your bills down little at a time, take a second job, go to credit counseling, or file bankruptcy, you need to make a plan and stick to it. In order for your credit to be improved, you have to have a plan and then take action!
6. Talk to those that you owe. Creditors want their money. They do not want you to default (quit paying). In fact, most creditors will work with you to get a reduced payment schedule. If you can keep them from reporting you to the credit bureau, then it won't hurt your credit. The catch here is this: be sure to stick to the new negotiated plan ? they won't renegotiate if you fail to comply.
7. The Best Cure is Time. Have you ever heard the saying 'time heals all wounds'? It also heals your credit. After 7 years, most items will be dropped. This is good news if you are working to correct your credit. As each year passes, more and more bad items will drop off and more and more good items will be included. Eventually, the disease will be cured.
Follow these steps and you will find that your credit looks healthier and healthier each day. Eventually this path will lead you to full recovery. Good Luck!

4 Steps You Can Take If Your Online Credit Card Application Has Been Refused

2007-05-28T02:43:00.001-07:00

Help! I've Been Turned Down
You received an envelope in the mail with a great offer for a low interest credit card. You read all the details, even the boring small print and decided that this card fit your needs to a tee. You filled out the required forms and anticipated the day that the card would arrive ? you even got to pick which background you got. However, what came in the mail was not an acceptance and a brand new card but a denial. What is your first reaction? Perhaps anger. Perhaps sadness. Perhaps fear. Yet none of these will help you get a card!
So, what should you do?
1. The first thing to do is read the letter carefully. Two important pieces of information must be included in the letter you receive when you're credit application is disapproved: The specific reasons you were denied credit, or information on how to obtain those reasons, and, if a credit report was used in making that decision, the name and address of the credit reporting agency. Here are some possible reasons for denial:
# Haven't lived at your current location long enough
# Haven't been employed at your current job long enough
# Your income is not sufficient to meet this particular creditor's minimum income requirement
# Information supplied by the credit bureau
2. If the reason for your denial is unclear to you, then call the company for clarification. What were the exact reasons? What were the exact standards that you did not meet? This information is important to know and understand. If you apply for credit again and are turned down, then this reflects poorly on your credit report. The best advice for this situation is to wait at least 6 months if you have been denied by two different companies in quick succession.
3. If you've been denied credit because of information supplied by a credit bureau, federal law requires the creditor to give you the name, address, and telephone number of the bureau that supplied the information. You should contact this agency for a copy of your credit report. Federal law states that you are entitled to a free copy if you've been turned down. Once you receive your report, check it for accuracy. Up to 40% of reports have errors. If you find an error, then you need to report this to the bureau in writing. Be sure to send along whatever proof you may have. Getting the credit bureau to investigate an error will not cost you anything and will save you a lot of time and frustration when it is corrected.
4. If mistakes on your report led to the rejection of your application, ask the credit bureau to send a corrected copy to the lender. Then you can ask the lender to reconsider your application. If however, you were denied because of a poor rating, only better spending habits and time will help you get the credit you desire.

Your Guide On Choosing a Credit Card To Suit You

2007-05-28T02:40:00.003-07:00

Reach into your wallet or purse, pull out a card, swipe, and you're done. It is very easy to use a credit card. The problem lies in choosing a card ? and it has nothing to do with the picture on the front! Choosing a credit card that works best for you is vital to your credit rating. If you choose incorrectly, you may find yourself in deep debt trouble. Here is some basic, yet extremely important, information that will help you make the right choice.
Your Money Handling Habits
Choosing a credit card that is perfect for one person may be a dismal failure for you because your habits are different. When it comes to choosing your credit card, you need to look very closely and honestly at your habits.
For instance, do you typically carry a balance or do you pay off the card at the end of each month? If you answered "yes" then you will need to shop for:
# A low Annual Percentage Rate (APR). The APR the interest rate you will pay on any outstanding balances each month. The higher the rate, the more you will pay in interest charges.
# A fixed-low rate. This means that they will guarantee that your rate will stay low. Oftentimes, a company will offer a low introductory rate to get you signed up and then increase the rates drastically in 3, 6, or 9 months. The problem with a guaranteed rate is that an annual fee often accompanies it. You will need to decide if the lower interest rate guarantee is worth the cost of the annual fee.
If you will be paying off your card at the end of each month, you will not have to worry as much about a low APR since you will not be using it. And with no need for a guarantee, you may be able to avoid yearly fees. However, you will want to be sure to get a card with a grace period.
# Grace Period: Be careful to get a card that allows you to pay off your bill at the end of the month with no finance charges. Those that don't offer the standard grace period begin charging you interest the moment you make a purchase.
# Cash Advance Fees: Be aware that most cards charge interest, and sometimes at a higher rate, for cash advances and this charge begins with no grace period even if your card offers a grace period for purchases.
You also need to decide how reliable you will be when it comes to paying on time and keeping yourself under the card limit. If you are often late paying your bills or often do not know how much credit you have left, you will want to watch out for transaction fees and other charges. Many card companies charge a late fee and an over-the-limit fee. These can be substantial. Your best bet is to pay on time and keep under the limit, however, finding a card with lower charges is a good idea.
Here is another important question to consider when looking at your money handling habits: Do you use the card rarely, occasionally, regularly, or frequently? Those that use their cards for just about everything instead of using cash or checks will want to look for credit card protection. This way, if you lose your card or it is stolen, you will not be responsible for any purchases made.
Finally, consider the different benefit programs that cards are offering.
# Do you travel? Then consider a card with frequent travel miles as a reward. Or perhaps one that offers traveler's insurance.
# Do you use your card for large purchases like electronics? You may want to consider credit card insurance that will replace your equipment for a specified period of time if it breaks down or gets stolen.
# Are you saving to buy a new car? There are cards that offer new car rebates.
# Do you have a favorite charity? Many cards now support specific charities, universities, and organizations by paying the entity a specific amount with each purchase you make.
What matters most is to find the features that fit your pattern of spending and paying. Don't get fooled by the gimmicks or the advertisements. Know your spending habits, look at the small print, and choose the card that is best for you. With all the different cards available, you will be able to find the right fit for you.
Wesley Atkins is the owner of http://www.credit-cards-advisor.com- which aims to get you fitted with the best credit cards to suit your situation. With numerous credit card articles and easy online credit card applications you will never choose the wrong credit card again.

Top 5 Credit Misconceptions

2007-05-28T02:40:00.001-07:00

We have all heard the rumors?from neighbors, relatives or friends. There are a wide variety of myths floating around about what you should and shouldn't do to improve your credit reports and credit scores. The buck stops here! Phelps Creek Financial Coaching has exposed these urban legends to provide you with the truth about credit...
1. Your score will drop if you check your credit - Fortunately, this one is definitely not true.Checking your own report and score is counted as a "soft inquiry" and doesn't harm your credit at all. Only "hard inquiries" from a lender or creditor, made when you apply for credit, can bring your credit score down a few points. Worried about damaging your credit while shopping around for a loan? Multiple inquiries for the same purpose within a short amount of time (a few weeks) are grouped together into a less damaging period of inquiry.
2. Closing old accounts will improve your credit score - To close or not to close, that is the question. Many people advocate closing old and inactive accounts as a way for improving your credit. In most cases, closing accounts will actually have the opposite effect. Canceling old credit accounts can lower yourcredit score by making your credit history appear shorter. Think twice before closing the oldest account on your credit report. If you want to reduce your levels of available credit, ask for your credit limits to be reduced or close newer accounts instead.
3. Once you pay off a negative record, it is removed from your credit report - Negative records such as collection accounts, bankruptcies and charge-offs will remain on your credit report for 7-10 years after they are first posted. Paying off the account before the end of the set term doesn't remove it from your credit report, but will cause the account to be marked as "paid." It is still a good idea to pay your debts, it can improve yourcredit score, but the major improvement will come when the record expires.
4. Being a co-signer doesn't make you responsible for the account - When you open a joint account, co-sign on a loan or become an authorized user on someone's credit card, you are taking on legal responsibility for the account. Any activity on these shared accounts, good or bad, will show up on both people's credit reports. If you co-sign for a friend's auto loan and they don't make the payments, your credit profile will be hurt by their actions and visa versa. The only way to stop this double reporting is to refinance the loan or to have the creditor officially remove you from the account.
5. Paying off a debt will add 50 points to your credit score - Yourcredit score is calculated using a complex algorithm that takes into account hundreds of factors and values. It is very hard to predict how many points you can gain by changing one factor. For a person with a high credit score, just one late payment can cause a significant drop. If a person has a low credit score, it may not cause a large drop at all. There is no magical way to improve your credit score, just keep paying your bills on time, reducing your debts and removing negative inaccuracies from your credit report. Good financial behavior and time are the two most important factors on your credit score.
Cindy S. Morus (www.phelps-creek.com) is a Certified Financial Recovery Counselor specializing in showing women and their families how to achieve financial well-being and peace of mind. She is also a Certified Credit Report Reviewer and Get Clients NOW!? licensee. Contact her at 541-387-2995 or cmorus@phelps-creek.com She is also the publisher and editor of "Financial Fitness", an internet gazette dedicated to helping people improve their financial fitness no matter what decisions were made in the past.

How Healthy Is Your Credit

2007-05-28T02:39:00.003-07:00

There's only one way to discover the "health" of your credit. You need to examine your credit report. Your credit report is your "consumer identity" that potential lenders will use to judge your credit worthiness.
Use these tips to give your credit profile the "tune-up" it needs for 2004.
Tip #1- Check for Errors Your credit report or profile is more than just a collection of who your creditors are and how much you owe them or have paid them.
The first thing you need to do is carefully check that your credit report is accurate. Nearly 70% of credit reports contain errors.
These errors may be as simple as an incorrect middle initial or address. Or it could be as serious as a creditor reporting that you were late with a payment when in fact you were not late at all.
This error might not seem like a big deal to you. However,to a future lender like a mortgage company it makes a big difference !
Carefully examine your credit report and if you find an error contact your creditor and the credit bureaus. Catch and correct these errors now before it hurts your chances of securing credit in the future.
Tip #2 - Correcting Errors The two most common errors contained in credit reports are:
1) wrong account information
2) incorrect recording of late payments.
If you find an account reported that does not belong you, you need to contact the credit grantor or issuer immediately. Remember, finding accounts that you have not personally opened is a sign of possible identity theft.
Hopefully you'll discover that this error is nothing more than an oversight and not an identity theft problem. Most often this occurs when they report an account belonging to a family member or someone with a similar name on your credit report.
If your problem is an error in reporting a late payment you will need proof to back up your case before this error can be corrected or removed. The most common error occurs when a payment is reported as "late" when it was actually a current or "on time" payment.
In either case, the problem can and should be corrected. You will need to correct the error in writing. Keep a journal or log of all calls and correspondence.
The Fair Credit Reporting Act (FCRA) requires the credit bureaus and the agency reporting the information to the credit bureau to correct inaccurate information in your credit report. Therefore, it is important that you contact both the credit bureau and the creditor whose information is in dispute.
A sample letter is included here to help you in correcting your credit profile. Make sure that you clearly identify the information that you dispute, include copies of receipts or documents that support your position. Then request that the information be corrected or deleted from your file.
Send your letter by certified mail and request a return receipt from the recipient. Keep all correspondence that you mail out. Give the agencies involved 30 days to begin their investigation. You can call them but be aware that phoning them does not protect your consumer rights! You must notify them in writing to protect your rights.
They must notify you of the results of their investigation. Although the process will take time, it's important to do it. This is your credit profile, your "consumer identity" that is at stake. Don't expect an error to correct itself.
At your request, the credit bureaus must send notices of corrections to your credit profile to anyone who has requested your report in the last six months. If you applied for a job and were turned down because of inaccurate information in your credit report, you can have the corrected report mailed to anyone who received a copy in the past two years.
++++++++++++++++++++++++++++++++++++ Sample Dispute Letter Date
Your Name Your Address Your City, State, Zip Code
Complaint Department Name of Credit Reporting Agency Address City, State, Zip Code
Dear Sir or Madam:
I am writing to dispute the following information in my file. The items I dispute are also encircled on the attached copy of the report I received. (Identify item(s) disputed by name of source, such as creditors or tax court, and identify type of item, such as credit account, judgment, etc.)
This item is (inaccurate or incomplete) because (describe what is inaccurate or incomplete and why). I am requesting that the item be deleted (or request another specific change) to correct the information.
Enclosed are copies of (use this sentence if applicable and describe any enclosed documentation, such as payment records, court documents) supporting my position. Please reinvestigate this (these) matter(s) and (delete or correct) the disputed item(s) as soon as possible.
Sincerely, Your name
Enclosures: (List what you are enclosing)
Originally Posted at http://www.ftc.gov/
++++++++++++++++++++++++++++++++++++
Tip #3 - Budget Planning You can also use your credit report to help you plan and implement a personal budget. Your credit report will show you where you are spending your hard earned dollars. While the credit card balances may not be completely current, you'll still see which of your cards has the highest balance outstanding.
If you have more than one major credit card you should compare the annual percentage rate (APR) you are paying on each account. If you are working on a budget to "pay down" your credit cards, start by paying down the one with the highest APR or interest.
Once that credit account is paid off, move toward paying off the account with the second highest APR. Using this method you will be able to concentrate your efforts toward paying down your outstanding credit obligations.
You should also check with your credit card company to see what's the best annual percentage rate (APR) they can offer you. If you are a good customer, you can often qualify for a lower rate than what you are currently being offered.
Caution: Ask if the new rate you are getting is a "promotional" rate or a "contract" rate. A promotional rate will expire at the end of the promotional term, for example 6 months. A contract rate does not have an "expiration" as long as you continue to meet the terms outlined by your creditor for that rate.
Tip #4 - Making a major purchase If you are considering a major purchase such as a car or a home, checking your credit report gives you the chance to see what a potential lender sees and uses to judge your credit worthiness.
You want to make sure that your credit report is accurate before you apply for that sports car or new home. Errors or problems can be corrected before your lender can use those against you and deny your credit request. You'll also have a better idea of what type or rate of credit you should expect from a potential lender.
Tip #5 - Check your credit report regularly Check your credit report regularly. Guard your "consumer identity" as you would anything else you treasure. Use your credit wisely, along with these tips, and you will enjoy the benefits that your good credit and your good name deserve now - and for years to come.

Debit Card vs. Credit Card, What Are The Differences ?

2007-05-28T02:39:00.001-07:00

Ah, the "good old days". If you are a baby boomer, like me, then you probably remember how important it was to rush to the bank on payday. You had to get there before the teller lanes closed so that you could have your "cash allowance" for the week. Otherwise, if you needed cash you had to write a check, then go to the bank, and "cash" the check for real cash.
Fortunately the days of the mad rush to get cash from the bank are long gone. We now enjoy the convenience of using a nearby automatic teller machine (ATM) or you can even get "cash back" at your local grocery, hardware or convenience store.
The card you use at the ATM is known as a debit card. When debit cards first appeared it was easy to tell them apart from credit cards. Debit cards didn't have a credit card company logo on them; instead, they usually just had your bank name, your account number and your name.
Today debit cards look exactly like credit cards even carrying the same logos. Both types of cards can be swiped at the checkout counter , used to make purchases on the internet, or to pay for the fill-up at the gas pump.
When you use your debit card to make a purchase, it's just like using cash. The account that is attached to your debit card, in most cases your checking account, is automatically debited when you use your debit card. The cost of your purchase is deducted from the funds you have in that account.
On the other hand, when you use your credit card to make a purchase you are using someone's else's money, specifically the issuer of the credit card, usually a banking institution.
In effect, you agree to pay them back the money you borrowed to make your purchase. In addition you will also pay interest on the money "loaned" to you at the rate which you agreed to when you applied for their credit card. This is known as the annual percentage rate (APR).
While the two cards might act and look alike, the levels of consumer protection that each type of card provides can be different.
Under federal law, if someone steals your credit card you're only responsible to pay the first $50 of unauthorized charges. However, if you notify the credit card issuer before a thief is able to make any charges you may be free from all liability. If the credit card is not physically present when an unauthorized or fraudulent purchase is made, such as over the internet, you're also free from liability for those charges.
MasterCard and Visa offer zero-liability protection where you won't pay any charges if someone uses your credit card to make an unauthorized purchase.
The protection offered to debit card fraud is similar but with a few exceptions. For example, your liability under federal law is limited to $50, the same as for a credit card, but only if you notify the issuer within two business days of discovering the card's loss or theft. Your liability for debit card fraud can jump up to $500 if you don't report the loss or theft within two business days.
And if you are the type of person that gives a passing glance to your monthly bank statement, you could be totally liable for any fraudulent debit card charges if you wait 60 days or more from the time your statement is mailed.
Visa and MasterCard zero-liability protection applies to your debit card but only for transactions that do not involve the use of your PIN (personal identification number).
Additional protection against fraudulent use of your credit or debit cards may be available through your homeowner's or renter's insurance. Check your policy or with your agent for more information about your coverage.
Also be aware that you should contact your card issuer by certified letter, return receipt requested, after you've contacted them by phone to protect your consumer rights.
As for which card to use for what type of purchase, most experts agree that you should use your debit card for the same type of purchases you'd make as if you were using cash. Therefore, it makes more sense to use your debit card than your credit card at the grocery store or gas station (provided you have sufficient funds to cover these purchases of course).
Avoid using your debit card for any online purchase or for something which is expensive. Why ? You'll find it much easier to dispute a charge when you use your credit card. If your gold-plated, limited edition, hip-swinging Elvis wall clock arrives broken, your credit card company will remove the charge until the problem is resolved.
With your debit card you are stuck dealing with the merchant directly to resolve any problems with a purchase, even if your banking institution could really use a gold-plated, limited edition, hip-swinging Elvis wall clock of their very own.

Credit Repair Scams

2007-05-28T02:38:00.001-07:00

"Erase Bad Debt !"
"Remove Negative Items From Your Credit Report"
You've probably seen these headlines and others just like it promising to clean up or "fix" bad credit. For someone who suffers from a bad or poor credit rating, these headlines are certainly an appealing offer.
Imagine finally being able to buy that new car, get debt collectors off your back, and enjoy a new found freedom from your past debts.
Sound to good to be true ? It probably is. Once you fall prey to the credit repair offer and pay the hefty fees involved to clean up your record, here's what happens:
1) The credit repair scam artist contacts the credit bureaus and reports that the negative information in your file is false.
2) The credit bureau removes this negative information from your report while they investigate the claim.
3) The scam artist will then show you the cleaned up version of your credit report and "ta-da" your credit history has been fixed !
But here's what the scammer doesn't tell or show you. After the credit bureau completes their investigation the negative information is placed back on your credit report.
Negative but accurate information cannot be removed from your credit profile. Only incorrect information can be removed.
Accurate information remains on your credit file for a period of 7 years from the time it is reported to the credit agencies; a bankruptcy appears for a 10 year period.
Many legitimate companies exist that can help you with your debt problems. But how do you spot a scam offer ? Easy, they'll ask you for their fees up front. By law, credit repair agencies cannot ask for payment until they've provided the service they promised.
Additionally many states require that a credit repair service, whether they are for-profit or not-for-profit, must provide you with a detailed written contract, an explanation of your legal rights, and the opportunity to cancel any signed contract within 3 days.
Also, be aware that a "credit repair offer" could be an attempt to steal your identity by getting you to provide personal information such as a Social Security number, bank account and credit card account numbers.
Always make sure you know who you are dealing with before accepting any offer to help you repair your credit. Those who don't can have their credit ruined further and create more debt problems.

Convenience Can Be Costly

2007-05-28T02:35:00.001-07:00

You've just opened your credit card bill and attached to your statement you find a "convenience check" included. It may already be filled out with a dollar amount such as $300, $500, or even $1,000. Your mind fills with ideas of what you could buy with this "instant" money. A new summer wardrobe, a nice dinner and tickets to a concert, a weekend getaway.
But before you go off on a shopping spree, you should be aware that your "convenience check" is nothing more than a cash advance on your credit card. Cash advances on credit cards carry many extra fees, often overlooked or misunderstood by consumers.
Here's a quick look at the types of fees most card issuers charge for a cash advance:
1) Upfront fee of 2-4% of the amount advanced. On a $1,000 cash advance your fee will range from $20-$40 in addition to the interest charges.
2) Higher interest rate than on purchases. Many credit card companies charge 18% or more on cash advances. In addition, most companies apply only a small percentage of your monthly minimum payment toward the cash advance.
Some require that you pay down the balance on your purchases first before applying payments to the higher-interest advance. In other words, you'll be paying fees and interest on your cash advance for a long time, especially if you only pay the minimum payment.
3) Cash advances normally carry no grace period. This means interest charges accrue as soon as you withdraw money or cash the convenience check.
By law your credit card company must disclose any fees associated with a cash advance. The easiest way to find out what fees are charged is to carefully read your credit card statement or to call your credit issuer's toll-free customer service number and ask questions.
Credit card companies charge these fees for two main reasons. One, to cover the costs to process this transaction which are often higher than a regular credit card purchase. And secondly because of the percentage of defaults among credit advance users. These costs are then passed along to you the consumer in the fees and interest rates associated with a cash advance.
The next time you are tempted to cash that convenience check or withdraw money from an ATM using your credit card, be sure you understand the fees and long term effects of using a credit card cash advance.

Beware of Falling Minimum Payments

2007-05-28T02:08:00.003-07:00

If you opened a credit card statement recently and were pleasantly surprised to find that your minimum payment due was lowered, don't be so quick to "jump for joy". What may appear as a small boost to your monthly budget is actually the rock that can weigh you down in debt for a lifetime.
More and more credit card companies are moving to requiring a minimum payment of 2% of your total outstanding balance. Consumer Action, a consumer advocacy group out of San Francisco, found that the number of card companies with a 2% minimum payment reached 53%, up from 43% just a year ago.
Some creditors have even gone so far as to call this a "consumer friendly" move claiming it will assist consumers faced with today's economic woes. In reality, a lower minimum payment causes you to take longer to pay off your debt to the creditor while winding up paying them more money in interest payments.
For example, let's say you have a credit card debt of $2500.00 @18% annual percentage rate (APR). Your monthly minimum payment based on a 2.5% pay back rate would be $62.50 per month. Oh and by the way, here's what the credit card company really doesn't want you to know - it will take you 20 YEARS to pay off your $2500.00 balance paying the minimum monthly due. And you will have paid the credit card company $3,365.51 in interest!
Now lets look at the same example using the rate of 2% minimum monthly payment. Your monthly payment drops to just $50.00 a month. You might be tempted to think "wow, I've got an extra $12.50 a month to play with, yippeee!". Not so fast! That lower minimum payment now means it will take you 34.5 YEARS to pay off your balance of $2500.00 and you'll wind up paying $6,430.93 in interest!
Consumer Action also reports that many credit card companies are imposing higher late payment fees and "more than a third of card issuers said they will raise existing cardholders' rates because of poor credit histories -- with other creditors -- even if the consumer has made regular, timely payments with that issuer".
My advice is to watch your use of credit carefully, always pay more than the minimum monthly due, and be sure to read the fine print on any credit card offers or changes to your existing accounts.

4 Steps to Creating Good Credit

2007-05-28T02:08:00.001-07:00

As a consumer you've learned the importance of establishing a good credit rating with your lenders. Whether you are shopping for a new home or auto, or searching for the best deals on insurance, your credit worthiness will be judged by your credit rating or credit score.
A bad credit history or bad credit habits will place "black marks" on your credit profile. These include things such as late payments, having an account assigned to a collection agency, and of course bankruptcy.
Establishing good credit habits and therefore a good credit rating will improve your credit worthiness. This will be reflected in potential lenders offering you substantially lower interest rates and better deals on credit offers.
Here are 4 tips to help you create a shining credit profile:
1) Pay Your Bills On Time
Lenders only have your past payment history on which to decide the type of credit risk you present to them. How you pay off your debts now indicates to them how you will pay off future debts.
2) Don't Use Too Many or Too Few Credit Cards
How much is too much ? How little is too little ? Many credit experts and financial planners suggest two to four credit cards is just the right mix.
3) Pay At Least The Minimum Due
Always pay at least the minimum due payment, but never less. And remember, just paying the minimum payment means it will take you years and years to pay off that credit card.
Example: Paying off a $2,000 credit payment at 18% APR with a minimum monthly payment of 2% ($40 dollars or less) will take you 30 years to pay off the amount plus interest.
4) Review Your Credit Report Regularly
Monitor your credit report from all three major credit bureaus - Experian, TransUnion, and Equifax - on a regular basis. Check your credit profile at least annually. Review it carefully and make sure that any past mistakes or disputes have been corrected.
Also, if you notice an account listed that you know that you have not personally opened, contact that creditor and the credit bureaus immediately. This could be a sign that you've had your identity stolen. Request to have a fraud alert placed on your profile and account to protect yourself and your credit. Identity theft is the fastest growing consumer crime in America, with an estimated 1 million people victimized each year.
Establish good credit habits early in life and reap the benefits that your good credit rating will provide you for the rest of your financial future.

To Repair Credit Is No longer Satisfactory - Learn How To Earn A Millionaires Credit In 30 Days...

2007-05-28T02:07:00.001-07:00

To repair your bad credit does not necessarily mean that you now have a good credit, absolutely not.
When most people have bad credit, they either purchase a credit repair book or seek a credit expert help. But before you do anything about your bad credit you need to understand few things that can be very crucial to your credit repair success.
Some people seek a credit expert's advice with the hope that a credit repair expert can do a better job of repairing their credit than they themselves could. In fact, the opposite is true. If you are not careful about who you hire as a credit advisor you can be in a deeper trouble, but that's beyond the scope of what we have room for.
Back to the TWO things you need to remember when you hire credit help:
1. There is no law available to any credit repair company, expert or lawyer that is not available to you as the consumer.
2. Credit repair companies use the same law made available to you by congress to repair your credit. And they can not change the law for their clients.

The above two simple statements might seem obvious, but repeating them like a mantra can be the difference between getting ripped-off and getting the credit you deserve.
Whatever you decide to do (either purchase a book or hire credit expert's help), you need to understand that once again, repairing your bad credit does not mean that you have an excellent credit.
It means just that: That you removed negative items from your credit report which caused for your credit to be bad in the first place.
Obviously, by removing negative entries your credit rating and credit score will improve, but you are far from having an excellent credit.
That's why a credit repair process need not be about just removing negative entries from your credit report. In fact, that's the beginning of the end. Today, you can find too many publications and credit expert's that would give you an advice on - "How You Can Repair Your Credit?"
But very few will show you or discuss the techniques need to be applied to earn positive credit rating. If your goal is to erase negative entries on your credit report, that's completely far from earning a powerful and positive credit rating.
In order to earn "Triple A" credit you need to add a good punch to your credit. Meaning, you have to learn "How to Add Positive Information" to your credit report.

Is it possible to add positive entries to your credit report? Absolutely.
Is it possible to add positive entries on your credit report in a short period of time? Absolutely.
Is it possible to get "A Millionaire's Credit in Less Than a Month"? No Doubt.

Here, you will learn two powerful tips that can give you "Triple A" credit in the shortest time possible.

1. A Millionaire Credit in 25 Days or Less!
Do you have a checking account and a savings account? Good. If you don't know worries, these days you can open an account online. It should take you no more than 5 minutes.
You got your accounts opened? Good, now comes the second phase.

Phase 2: Now you will need your savings account to use it as a collateral. Now using your savings account ask your bank for a secured passbook loan.
You can borrow a dollar for dollar with a passbook loan. This type of loan works well with as little as $300, but if you have $10,000 - that's even better. Once you secure a loan with a passbook you can not touch the funds until you have fully repaid the loan.
Remember, you should be able to do with-out these funds for 30 days.
A bank secured with your passbook loan has no risk in lending you money, so any bank should be willing.
Note: It is extremely important that the bank reports your loans to the credit bureau. Therefore ask your bank "If they report your payment history to the three credit bureaus?", it is critical part of this whole process. After all, the whole purpose of you doing this is to add zing to your credit report with a very powerful and positive payment history, right?
Now once you borrow the money, wait 25 days and repay the loan back to your bank. Because you have fully repaid your loan the bank will send your positive payment history to the credit bureau.
That's a grand slam!
Now you have the bank as your friend and the credit bureaus can not help it but report your good payment history.

2. How To Use $500 - $1000 into A Millionaire's Credit
With let's say a $1,000 in your account, ask the loan officer for a 12- month a $1,000 passbook loan. Do not be discouraged, you can certainly achieve this with less money, but if you can afford to do it don't hesitate. By the time you're done with this technique - - - well it'll be all worth it. Just wait and see.

Since this is a secured passbook loan (meaning, it is secured by the amount of money available in your savings) most banks will not run a credit check. And if they tried to do so explain it to them why they should not as it is secured by the money you already have in your savings account. Which you won't be able to access until you payoff your loan anyway, so there is no justified reason to run a credit check.
Now with the $1,000 secured passbook loan from your first bank, open a savings account at another bank with the $1,000 loan received from the first bank.
The request that they give you a $1,000 12-month loan and do not mention the loan received from the first bank. Wait about a week or two, go to a third bank and repeat the process.
Next, at one of the three banks open a checking account with the $1,000 you received from the third bank. You now have a$1,000 in a checking account and three outstanding 12-month loans at three different banks ? for a total of $3,000.
Deduct your original $1,000 and you need only repay $2,00 plus interest.

Note: Make sure that you ask your bank if they have a pre-payment penalty because you do not want that.
Finally, about one week later start to pre-pay your three loans.
Now you have an advance payment record with three banks and will have established powerful credit for your credit report. From now on every type of loan and credit card will be yours for the asking.
Here you are with un-touchable credit, three big banks as your future business friends, and a credit bureau reporting positive payment history ? all in just under 30 days.
You just learned about one of the very few techniques that can change your credit significantly within a month time. Of course you can apply these techniques for as long as you like and keep improving your credit. Apply these techniques discussed and you will get the Triple A credit you deserve.

3 Ways to Improve Your Credit Score by 50 Points In Less Than 30 Days

2007-05-28T02:06:00.001-07:00

In Less Than 30 Days. "What can you do to increase that set of three numbers on your credit report that can be so important with your financing?" I came across this question as I was surfing discussion groups the other day. Check out my answer: Dear Friend, Here are 3 steps I used to take my credit score from 592 (horrible credit) to 762 (perfect credit) almost overnight. If you're interested in improving your credit rating quickly, you'll find this story helpful: In 1995 I made a decision that would ruin my perfect credit history. I quit my salary job to become an insurance salesman. The job paid commission only. Within a few months I lost everything - house, car, credit rating and my self respect. By the end of 1996 I was living with my mom, all my credit accounts were severely past due, and I was paying 22% interest on a broke-down green Geo Storm...I was a real loser. Then, in 1997, I became a banker. I didn't know it at the time, but this would turn out to be the break I needed to eliminate my credit problems forever. During my seven years as a banker, I came across several legal and highly effective ways to improve my credit rating. As a result, I was able to increase my credit scores by an average of 170 points. Here's what I did: Step #1: After spending hundreds of dollars on credit repair services that didn't work, I found out how to get negative accounts removed on my own. Basically, I wrote letters to the collection agencies requesting proof that the accounts were mine. 89% of the time they had no proof that the bad accounts belonged to me. So I was able to get them deleted from my credit file. Step #2: I opened new accounts with high credit limits and kept the balances low. I discovered that if you keep your available credit limits high and only use 10% to 30% of the credit you have available, your credit score will improve dramatically. Step #3: Next, I added accounts with years of perfect payment history to my credit file. This step took my credit score from 647 to 762. While you can certainly add seasoned accounts to your credit file for free, there are companies that claim they can do it for a fee. The problem is, they charge between $2,000 and $2,500 per account. If you want a 700+ credit score you'll need 3 to 4 of these accounts. That equates to a cost of $6,000 to $10,000. (You can conduct a search on your favorite search engine for companies that offer this service.) While there are several highly effective steps you can take to increase your credit scores by as much as 200 points, these are the main ones...And here's the good news: Each step can be completed in less than 30 days.

Credit Damage: Getting Compensated for Your Loss

2007-05-28T02:04:00.001-07:00

Until recently lawyers for victims of credit damage had little possibility to collect for damages beyond medical treatment, lost wages and property loss. Insurance companies threw up their hands in sympathy, claiming victims can only be compensated for what can be measured - tangible goods and services. But, what happens when the victim has lost considerable time from work, the family bank is broke and monthly payments on mortgages, car loans and credit cards payments are missed? Regardless of the haggling between lawyers and insurance companies, it's the credit victim who ends up having to live with a bad credit rating.
Today, there are legally accepted means for measuring loss of credit through the procedure of Credit Damage Measurement (CDM). CDM is fast becoming a potent tool for recoverable credit damage awards when the damage is not self-inflicted. Previously, both judge and jury, and especially the insurance companies, refused to acknowledge CDM claiming it was speculative because they could not define it as tangible damage.
However, in case after case, victims of credit damage who use the CDM method are getting compensation for credit loss. Many factors are changing the old mindset including credit bureau technology improvements, the application of the Fair Credit Reporting Act (FCRA), risk scoring sophistication, and the development of CDM as an objective, repeatable method that measures out-of-pocket damage reliably.
Credit Ratings and Recovery
The impact of a bad credit rating is much more significant than most people think. Consider what poorly rated consumers face when they want to lease or buy vehicles, obtain credit cards, buy or lease or refinance their residence. In most cases, it's an easy decision for the creditor: the credit application is simply turned down or the borrower is charged a much higher down payment ? maybe thousands of dollars more with monthly payments that are typically several hundred dollars more.
"A person with bad credit is viewed with suspicion and is charged significantly more for future extension of credit because the lender feels the need to protect against a greater risk or default," says Tom Key, a civil litigator practicing in Tustin, CA.
"Over the years I have heard reports of financial damages from clients who have been wrongfully terminated, defrauded, injured in an accident or suffered losses from breach of contract," Key says. "These victims were especially distraught over the fact that their prime credit reputation, carefully nurtured for years, is destroyed overnight. It seemed to me that there must be a way to compensate victims for that type of loss."
Key has witnessed the reactions of many jurors who failed to award a victim of credit damage their rightful compensation simply because they could not quantify the damages. "Jurors want a specific loss that they can count, hold and see," says Key. "Their reasoning is that they need to know that it is genuine. They have a tough time awarding damages based on sympathy. In order for them to confirm authenticity of a claim, they want to see its quantification."
Measuring Loss of Creditworthiness
Assuring authenticity has been a sticky situation when it concerns measuring out-of-pocket loss for victims of credit damage - until now. Attorneys who represent victims of credit damage are now utilizing the Credit Damage Measurement method to recover out-of-pocket losses for their clients.
"CDM measures the actual out-of-pocket dollars reasonably expected from loss of creditworthiness, which includes higher down payments, higher points and costs on loans, higher interest rates, higher monthly payments, or outright denial of credit," says Key. "In addition, the CDM method also calculates the rates, costs and other terms applicable to the resulting credit rating by lenders and projects the results over the relevant number of years for the types of loans the client is likely to seek."
Key continues, "For example, if a client's credit was near perfect before a triggering event, and is subsequently damaged by the event, the CDM procedure can illustrate before and after analyses, calculating the cost of the same loans with the two different credit reports, Pre- injury credit compared to Post-injury credit." In many cases, CDM clients have already realized significant compensation. In one such case CDM was instrumental in recovering $56,000 for damaged credit reputation. "That calculation is the difference between what refinancing a $140,000 loan would have cost my client with their prior rating, and what it will cost them out-of-pocket with their damaged credit rating -measured over a seven-year period."
Isolated Compensation vs. Repeatable Compensation
The CDM method of measuring intangible credit loss is increasingly becoming the basis of recovery for victims of credit damage. It's changing the way judges and juries measure recoverable out-of-pocket loss, and then can compensate for loss of credit expectancy. Certainly there are still some skeptics, mostly defendants. Technically, credit damage measurement is intangible. However, CDM has proven an objective and practical procedure to calculate out-of-pocket damage for companies or families to compensate for their credit damage.
"To have this kind of measurement is an exciting complexity in our society," says Key. "CDM is very understandable and a rather simple way to come to a conclusion of loss for the victim. If you understand the math and are an expert at reading credit reports, the calculations and recovery are undeniable. It's a method of turning isolated compensation into repeatable compensation. It's changing the way jurors rule on these damaging cases. Because of this method, victims of credit damage can be more fairly and more completely compensated for out-of-pocket damage."
Georg Finder, president of CM Financial Services of Fullerton, California, wrote and presents the first State Bar accepted continuing legal education seminar on credit reports and credit damage. He can be reached at gfinder@creditdamage.com (714) 441-0900 or at http://www.creditdamage.com

19,178 Identity Theft Victims Per Day - Are You One Of Them?

2007-05-28T02:01:00.001-07:00

Identity theft statistics are shocking. And we are told that it will only become worse, before it gets any better. Are you likely to be affected?
According to recent studies, up to 7,000,000 people become identity theft victims each year, in the United States alone. That's over 19,000 cases a day, or 799 cases an hour. Whichever way you look at it, these are shocking figures. And with more and more people using the Internet, online banking, and other hi-tech services, things aren't likely to improve any time soon.
In fact, another research, a survey conducted on behalf of the Federal Trade Commission recently, tells us that the situation is even worse. According to the FTC survey report, 4.6% of the US population were identity fraud victims last year - that's 10 million people.
According to the FTC figures, if someone fraudulently opens a new credit card or another loan account under your name, on average you can expect the dollar amount to go to about $10,200. That's just an average amount.
To clean up your name, and your credit rating, you will need to deal with this experience. You can expect to spend between $500 and $1,200 of your own hard-earned money cleaning up the mess. You can also expect to invest between 30 and 60 hours of your time.
The above figures are just cold statistics. They say nothing about the emotional trauma, through which you are likely to go when it happens to you. It's all very well to read and hear about bad things that happen to other people. It is quite different when the same thing happens to you, or your loved one.
Is there anything you can do in order to protect yourself? There is. Quite a bit actually. It's all based on common sense and, while there are no guarantees in life, you will minimise the risk and make the life of an identity thief a lot harder.
Funny thing about thieves. They don't like working hard. If you make it hard enough for them, they will usually go away - to find an easier target.
One of the common-sense things you can do in order to protect yourself, and your family, is to make yourself aware of the current scams that may affect you.
The most infamous one at the moment is so a called 'phishing' scam. In a nutshell it looks like this:
You get an email that looks like it was sent from your bank. They ask you to log in to your online account and verify some of your details. For your convenience, there is a link included right in the email. All you have to do is click on it an log in. Don't ever!
The moment you click on that link and log in, the scam artists have your login ID and password recorded. This will enable them to log in to your account and within hours, or days, your account will be cleaned out!.
There are two common-sense approaches to deal with this.
First, you have to realise that your bank already has all the details they need to operate your online account. If they didn't, you wouldn't be able to open it in the first place. So, you can most likely quite safely delete the email and forget about it.
Secondly, if you have any doubts as to the authenticity of the email, you can get the bank's phone number from your local phone book and give them a call. Tell them about the email you received and ask if they tried to contact you. I bet they are going to be as surprised as you are.
And just remember: Whatever you do, never, ever, log in to your bank account, or any other sensitive account for that matter, right from an email. You already have the login link somewhere in your records. If not, go to the bank's main page and look for an online login page.

Creditcard scoring

2007-05-28T01:44:00.000-07:00

It's your right to know what credit scoring agencies are saying about you. Finding out this information is doesn't cost a lot and takes only minutes to do - which may be time very well spent.
So what is credit scoring? Simply put, credit scoring is a method of assessing the credit risk of a loan applicant. It uses mathematical models to evaluate a person's credit worthiness based on their credit history and current credit accounts. The system was first developed in the 1950s, but has come into widespread use in just the last couple of decades.
In the early '80s, the three major credit bureaus (Experian, Equifax and Trans Union) each developed scoring models that allowed them to offer a score based solely on the data of one individual. Creditors, especially those in the home mortgage industry, frequently use these scores when deciding who gets a loan and at what rate. However, it's worth remembering that creditors also consider other information, such as your salary or employment history, when making loan decisions.
What's in a score? Credit scores are reported as a number, usually in the 300-900 range. The higher the number the better the score. Creditors see the number as an indicator that an individual will repay a loan. Typically, scores are determined by reviewing the following data