Best Credit Card Blog

When applying for loans, credit cards, or even trying to lease a new apartment your credit score is the major determinant of how well you will fair. Ironically very few people know what their credit score is and are not aware of the fact that they may be doing various things to hurt their credit score. If a high credit score is important to you, and it should be, beware of the following things to keep your credit score in check.

Have you ever had one of those months where everything seems to pile up and you just cant make ends meet? You take a look at what you owe, who you owe it to, and finally decide that the credit card payment is going to have to wait until the next check. Not even that, lets cay you just forget to make your credit card payment on time. This is the first and most common mistake: missing payments or making late payments. If you know it or not every time you make a payment to any of your lenders, they report what amount you have paid, and whether you were on time or late. If your late basically consider it much like getting a test question wrong, your credit score drops. In addition, they will report how late you were, and your record of lateness will be represented on your report. Now you want to get a loan for a new car and the dealer pulls your credit report and your credit score shows you were late X amount of times last year. Put yourself in his shoes. If you lend your buddy $20 and he pays you back immediately you will lend him money again but if you have been waiting for that $20 for over a year next time he asks youre not going to be as keen on it are you? If its clear that you have a habitual pattern of paying your bills late, they will think twice about lending you money.

Second, this is another one people never consider will hurt their credit report and I know when you read this you will realize you are guilty of it. If you get a mailing promoting a 0% credit card or a new great rewards credit card and figure you could use another card do you apply for it? Well if you do you could be docking your credit score yet again. Every time you submit an application for a credit card or apply for a loan the credit agencies are notified of your credit report being pulled and checked. If this happens too many times it will undoubtedly hurt your credit score. The credit agencies will look at those inquiries as attempts to get credit or a loan and if those dont follow the inquiry it reflects poorly because it seems as though youre not getting approval. No one (except the credit reporting agencies) knows the formula for how many inquires will hurt your report, but the general rule of thumb is simply not to apply for credit unless its absolutely necessary.

Lastly is another tip to look out for that I am sure most people dont really think about and thats leaving credit cards on your credit report. I know its the opposite of what you have been taught but lets think about it. If you have a credit card on your credit report that has been paid on time every time its a star on your credit report. Removing it would dock your score believe it or not. Of course credit scores favor accounts that are active so try and keep charging small items and paying them off regularly to maintain this benefit on your credit score and youll be surprised how quickly your credit score will increase.

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Why Pay For Credit Repair Services Do It Yourself

Advertisements for credit repair services are everywhere, but what do you get when you purchase one of these services. Actually you get very little and possibly nothing because according to consumer reports many of these offers are scams. Many credit repair services charge you money to give you ideas about how you can repair the credit yourself. It is impossible for a company to repair your bad credit. That is something you have to do for yourself.

A credit repair company advertises that it will clear up all your bad credit problems and make it easier for you to get a loan for a car or a credit card. Many of these companies charge you hundreds of dollars, which you can use to pay your monthly bills and so nothing for you. You can provide you own credit repair services by starting with a request for your credit report. This is free, whether you make the request online or from one of the credit reporting agencies. You are entitled to one free report per year.

When you want to use credit repair services, you can avail of a debt reduction loan from your bank. Lenders are quite eager to help you in this regard because they know that you are making a conscientious effort to repair your bad credit. You might need to sit down with a counsellor to determine the amount of money you need to borrow. The lender will pay off your creditors leaving you with a manageable monthly payment, which more than likely is less than the total you currently have.

You need to be wary about paying any money to credit repair companies that want you to pay upfront before receiving any credit repair services. If you do contact a credit repair company, you need to make sure the person you speak with tells you what you can do on your own for free. If you do not receive this information from the company, then you should run as fast as possible.

If a credit repair company advises you to dispute the information regarding your credit history and you follow this advice, then you could be committing fraud. It is important for you to review your credit report to make sure that all the information is correct. There have been cases where some of the information is incorrect, but the chances of all of it being in need of dispute are highly unlikely.

No credit repair services can remove any unfavourable items from your credit report. What you need to do is start working on paying your bills on time or making arrangements with your creditors to take smaller amounts. All of this reflects favourably on your credit report, but no matter what credit repair services you use, the only way items can be removed is if you can prove they are incorrect. Your credit history is very important and you need to protect it.

Looking for credit repair services? Be careful.

Have your read your credit card contract through completely? Do you know when it is okay for your creditor to raise your interest rates? If you are not sure about how and when your rates can be affected over the life of your contract you should take a few minutes to read your contract thoroughly from beginning to end.

Creditors must have clauses in their contracts that give them the right to change your interest rates. And if your rates have gone up you can be pretty sure that they are there, you may have missed them on your first read through but they are there buried in the contract.

If even after reading your contract again you still cannot figure out just how your credit card issuer can do this to you ask yourself the following questions.

Have you been late paying your monthly credit card payment recently? If you have, your interest rate going up is most likely due to this factor. Whenever you are late making a payment the credit card company has the right to raise your interest rates.

Have you been late on any other debt payments? Any late payments can cause your interest rates to rise, even ones that are not associated with your credit card. Your creditors have access to your credit report and all payments that you make are on there, if they see you made a late payment to someone else it can get them concerned that you will do the same to them in the future. That is why it is so important to always make your payments on time every single month.

Has your credit card company merged with another company? Mergers can affect your contract. The acquiring company has the right to change the rules on you as long as they let you know what is going on and why.

It is amazing what credit card companies can get away with legally. All you can do is make sure that you understand the ins and out of your contract, that way you will not be stunned when you get hit with extra fees.

Credit cards are a big financial responsibility, before you sign for one decide if it is really the right thing for you financially.

When you sign your credit card contract you probably assume that the interest rate quoted in this contract is the rate that you will always be paying. This is not the case. Credit card companies have the right to up your interest rate. Knowing how and why can save you a lot of stress in the long run.

Which Low Interest Credit Card Is Best – Variable or Fixed Interest Cards?

When applying for low interest credit cards, you may think you know what you are looking for. After all, it seems pretty clear. The lower the APR, the less money you will have to pay, right? In reality, this is not always the case. In fact, one factor you will need to take into consideration is whether the APR is variable or fixed. Then, you can make a far better decision when choosing from among the available low interest rate credit cards on the market.

Low Interest Credit Cards with Variable Interest Rates

Low interest credit cards with variable interest rates are those that fluctuate with the prime rate. The prime rate is the rate top United States banks pay to borrow money from the Federal Reserve. Therefore, you will often see interest rates written as the prime rate, plus an additional percentage APR in order to provide the bank with a profit.

When the prime rate is in a downward swing, as it has been in the past few years, these cards can be quite attractive to the consumer simply because the APR is lowered. On the other hand, these cards can have skyrocketing interest rates when the prime rate is soaring. In addition, many credit card companies place a minimum APR on the cards. This means the APR will never fall below a specific rate, regardless of where the prime rate stands. At the same time, your interest rate will increase as the prime rate increases – and you won’t see credit card companies placing caps on how high these rates can become.

Low Interest Credit Cards with Fixed Rates

Low interest credit cards with fixed rates are those with interest rates that do not fluctuate or change. For example, if a credit card offers a 7.99% fixed interest rate, it means the interest rate will not become higher or lower that 7.99% – no matter what the prime rate may be. A word of caution, however: credit card companies have the right to change a fixed rate to a higher fixed rate by simply sending you a 30 day written notice. These notices can be very unassuming and in small print, and simply slipped in with your monthly billing statement. Therefore, it is important for you to read all paperwork included with your bill and to keep an eye out for changes in your fixed rate.

The Introductory Rate

When you shop through the numerous cheap credit cards available, you most likely pay the majority of your attention to the introductory rate. Usually, introductory rates on low interest rate credit cards are minimal and fixed. In fact, it is not unusual to see cheap credit cards with APRs of 0.00%. What you need to look at, however, is the APR after the introductory period is complete and whether it is variable or fixed. This is particularly important if you do not foresee yourself being able to pay your balances in full after the introductory period is complete.

The post-introductory period rate is often referred to as the “go rate.” With most low interest credit cards, the go rate is variable and based on the prime rate. The go rate is not always the same from customer to customer because credit card companies generally offer better APRs to the customers with the best credit history.

Deciding Which is Best

Determining which of these types of low interest credit cards is best for you depends on your financial situation. If you pay your balance in full at the end of each billing cycle, it really doesn’t matter if your rate is variable or fixed. On the other hand, it can be incredibly important if you do carry a balance. The perk to a fixed rate is that you are always sure of what your interest rate will be from month to month, so long as you make sure to read all information inserted along with your bill each month. This makes it easier to plan a budget and keep a closer eye on your finances. At the same time, you might save money in the long run by taking advantage of low interest credit cards with variable APRs when the prime rate is low. If you are disciplined enough to keep an eye on the fluctuating market and to take advantage of cheap credit cards when the rate is low, variable APR cards may be your best bet.

With U.S. credit card debt at an all time high, many savvy consumers and investors are renewing their commitments to rid themselves of this burdensome and in most cases, unnecessary debt. In doing so they are constantly searching for the next best credit card with higher credit limits, lower annual percentage rates (APRs), and zero balance transfer offers. In fact switching credit cards has become as common as changing the battery in the fire alarm for some people and it has actually worked. So if you are amongst the thousands of Americans who are thinking of making a switch to improve your financial picture, before you do there are a few things that you should consider. They include how multiple inquiries for credit will affect your credit score and if the APR that applies to balance transfers after the introductory grace period still makes it a good deal. In addition to these two things you should also, as with everything you do, conduct your own research to find the best solution to meet your needs.

It makes sound economical sense to switch credit cards to save money in interest charges and fees. Especially when you consider the fact that for most credit cards the minimum monthly payment is so low that it barely covers the interest charges reducing your outstanding balance by just a few measly dollars from month to month. Its no wonder then that we jump at any new offer that comes our way. When deciding whether to switch cards though, you should keep in mind that every time you apply for a new credit card an inquiry from that particular creditor goes on to your credit file whether you receive the credit or not. Additionally, multiple inquires by different creditors negatively impacts your credit score and any account whether closed or unused remains on your credit file for at least seven years. Last thing, switching cards and closing accounts immediately after the switch also impacts your credit score.

When considering whether to take advantage of a 0% balance transfer offer, you should consider the amount of time that youll have before the normal APR applies to that balance and whether youll be able to pay that in full before the grace period is over. Additionally, in the event that you arent able to pay off the balance prior to expiration of the grace period, you should consider if the new APR that kicks in will be a significant savings from the card that you are considering transferring balances from and whether interest will be charged on just the remaining balance or the entire amount that you initially transferred.

To ensure that you are getting the best deal, you should do a thorough search of available credit cards before making a final decision on which institution to submit a new application for credit to. By doing so you will know upfront exactly what you are getting and whether there are cost savings to be realized, leaving very little room for surprises.

Switching credit cards is a smart choice for consumers who are trying to manage and conquer their debt. For the disciplined person, this is a very effective strategy to help you reduce your debt load. If you find yourself in the situation where you are presented with an opportunity to switch credit cards, please keep in mind the negative effect that multiple inquiries will have on your credit score as well as the opening of new accounts while simultaneously closing others. When done wisely, after conducting a thorough search of available options, switching credit cards can definitely help you to achieve your financial goals.

What To Expect When You Complete A Credit Card Application

You can find a credit card application in your daily postal mail, in your email and you will find all types of credit card applications online. If you want a credit card, if you want a new credit card or even if you are seeking another credit card for your wallet, you can find credit card applications for that particular type of card you want to get. Complete a credit card application to obtain a new line of credit for yourself, your business or even for a child you are sending off to college.

You should know there are different types of credit card applications, such as balance transfers, low interest rate, and you will find special cards for special rewards and needs. Some special reward cards are travel rewards; cash back rewards and low interest rewards. You will find credit card applications for those with bad credit, or you can also find credit card applications for those who are seeking high credit lines. A credit card application can be used to obtain the type of credit card you want to have for your financial security and future.

A credit card application should be filled out completely. You will need to include your name, address, phone number, work information, information about your wages, and your annual income. You will need your credit card information if you are going to transfer balances, and you will need to have your spouse sign the application if you are opening a joint account. A credit card application is not going to take more than a few minutes to complete, online, offline, or in person.

You can complete a credit card application without waiting on the phone or online, and you will get a response to your credit card application in just seconds. When you mail in a credit card application, you have to wait a longer time to get a response, which is generally about two weeks. A credit card application does not take long to fill out, but you determine which method you would like to complete to get a new credit line.

After applying for a credit card, and you find that you are denied, you will get a letter stating that you are not eligible, or perhaps you will get a reply stating that you are qualified but only for a certain savings deposit type credit card. You will on that letter, find a name and address of a company where you can request a free copy of your credit report. You are entitled to that free credit report because you were denied credit, and this is the law.

If you were accepted, you will receive a letter, stating what your new credit line is, what type of credit card you are being issued, and you will be notified in a separate letter with your actual credit card. In still another letter, you should receive your pin number for that credit card. These separate letters are for your protection, so that in case the card was stolen, the person will not have the pin number. If you receive one letter without receiving the others, you should call the credit card company and tell them that there is a problem with that account, and they will reissue you a credit card, and cancel the one that is lost so there is no problems at all with your new account.

What Makes Small Business Credit Cards Different From Corporate Cards

Everyone in business is aware that business credit cards have become increasingly popular. Business credit cards have been receiving special attention from credit card issuers: They recognize the business potential created by the rising demand for business credit cards among small and home-based businesses, and are intent on tapping into it.

The major credit card companies designed business credit cards purposely to address the needs of these small and medium sized companies. Wherever you look – on the Internet, radio and broadcast media, newspapers and other print media – you will find the card issuers advertising these business credit cards, and that the adverts specifically target small to medium enterprises. The point: to inform their target market about the features and benefits of their specific business credit card offerings.

So, how did the business credit card companies design their small business credit cards? Although there are variations from one business credit card package to the next, the basic features generally cover cash discounts for purchases of business-related supplies, a wide array of opportunities for rewards, travel privileges, frequent flier miles, and very low annual percentage rates for balance transfers in their introductory periods. The small business credit card holder also receives periodic reports as rule, which summarizes purchases made on the business credit card account. These reports can normally be viewed online and can be downloaded into a QuickBooks file.

Like small business credit cards, large corporations have equivalent corporate business credit cards. These are markedly different because corporate business credit cards (or simply corporate credit cards), are specifically designed for the corporation itself and not for the individuals inside the corporation. Once a corporation decides to apply for a corporate credit card, the officers enter into negotiations with the credit card issuers to hammer out the specific features of the card and how the business credit card will integrate with the companys finances and financial systems.

The corporate business credit cards are usually distributed to employees to use for those expenses they would normally incur on behalf of the company. Like small business credit cards, corporate credit cards also track the expenses incurred by each cardholder and individual reports are submitted to management. Because of the different, and often more complex, expenses incurred by large corporations, the system of reporting generally requires a specialized software application to resolve these financial complexities.

The single most significant difference between small business credit cards and corporate credit cards is the mode of payment. Generally, for small business credit cards, the credit card is the responsibility of the primary individual applicant who is also responsible for paying the balances or installments due. In the case of the corporate credit card, the credit card is issued in the name of the corporation. Primary responsibility for payment thus resides with the officers of the corporation.

The process of issuing a corporate business credit card is much more complicated than that of a small business credit card. For the small business owner who wishes to apply for a business credit card, it is quite simple actually; there are even websites where you can compare the different business credit cards and submit online applications once a choice is made. This is a luxury that a large corporate in need of a business credit card account, simply does not have.

A credit rating is simply someones assessment of how well you would be able to pay back money lent to you. Usually, that someone is a credit reporting agency; however, creditors themselves will also make their own assessment, which is usually based on the score you receive from the credit reporting agencies and is determined by requirements that vary a great deal from one creditor to the next. The largest scoring agency determines your “FICO” score. {http://www.fico.com}

Credit can be established in a number of ways. Perhaps the most common is the opening of a credit card account. In some cases, a secured card (a card that requires you to pay money into an account the creditor controls before you receive a card) may be the way to establish credit initially. You can also use low balance store cards or gas cards that let you prove that you can pay your monthly payments back, before qualifying for a larger balance credit card.

Again, credit is just one persons or one entitys estimation of your ability to repay what you borrow. Once youve established one or more trade lines on your credit, your score will be more directly related to the percentage of credit you carry as compared to the total amount you could carry and your payment history on the trade lines you have. If you are looking for credit lines, or credit reports, there are providers available at http://Bills.com A trade line is any credit account where you have borrowed money and are paying it back such as a credit card, home loan, or signature loan. All your open trade lines and some of your closed ones will show up on your credit report.

As mentioned above, the amount of debt you are currently carrying when compared to your max debt is one factor that figures into your credit rating. If your max debt, or credit limit, is $10,000 and you are carrying $8,620, youre currently carrying over 80% of your max debt, which is more than the credit reporting agencies like to see.

Payment history is another factor the agencies use to determine your score. Your payment history is the trend you set when it comes to paying off your debt, either an on-time minimum payment every month or a less-than-minimum payment, late payment, or other problem even one time. If your payment history isnt spotless, it can cost you points on your credit score, and may cost you money the next time you try to get a loan.

The length of time your trade lines have been open will also affect how your score is established. Closing old trade lines in favor of new ones wont help your score, since your payment history on the new trade lines wont be as long as it was on the old, giving the credit reporting agencies less on which to base your credit score.

Credit and your credit score have everything to do with your usage, management, and payment habits pertaining to the trade lines on your credit report. Be wise in the handling of these trade lines and your score will rise. Make poor decisions and your credit will suffer. Your credit rating is important when it comes to financing cars and homes, shopping for insurance even when interviewing for some jobs. Youll want to present the most responsible picture, and that means having excellent, well-established credit that speaks for itself.

The Equal Credit Opportunity Act (ECOA) ensures that all consumers are given an equal chance to obtain credit. This doesnt mean all consumers who apply for credit get it: Factors such as income, expenses, debt, and credit history are considerations for creditworthiness.

The law protects you when you deal with any creditor who regularly extends credit, including banks, small loan and finance companies, retail and department stores, credit card companies, and credit unions. Anyone involved in granting credit, such as real estate brokers who arrange financing, is covered by the law. Businesses applying for credit also are protected by the law.

When You Apply For Credit, A Creditor May Not…

Discourage you from applying because of your sex, marital status, age, race, national origin, or because you receive public assistance income.

Ask you to reveal your sex, race, national origin, or religion. A creditor may ask you to voluntarily disclose this information (except for religion) if youre applying for a real estate loan. This information helps federal agencies enforce anti-discrimination laws. You may be asked about your residence or immigration status.

Ask if youre widowed or divorced. When permitted to ask marital status, a creditor may only use the terms: married, unmarried, or separated.

Ask about your marital status if youre applying for a separate, unsecured account. A creditor may ask you to provide this information if you live in “community property” states: Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, and Washington. A creditor in any state may ask for this information if you apply for a joint account or one secured by property.

Request information about your spouse, except when your spouse is applying with you; your spouse will be allowed to use the account; you are relying on your spouses income or on alimony or child support income from a former spouse; or if you reside in a community property state.

Inquire about your plans for having or raising children.

Ask if you receive alimony, child support, or separate maintenance payments, unless youre first told that you dont have to provide this information if you wont rely on these payments to get credit. A creditor may ask if you have to pay alimony, child support, or separate maintenance payments.

When Deciding To Give You Credit, A Creditor May Not…

Consider your sex, marital status, race, national origin, or religion.

Consider whether you have a telephone listing in your name. A creditor may consider whether you have a phone.

Consider the race of people in the neighborhood where you want to buy, refinance or improve a house with borrowed money.

Consider your age, unless:

– youre too young to sign contracts, generally younger than 18 years of age;
– youre 62 or older, and the creditor will favor you because of your age;
– its used to determine the meaning of other factors important to creditworthiness. For example, a creditor could use your age to determine if your income might drop because youre about to retire;
– its used in a valid scoring system that favors applicants age 62 and older. A credit-scoring system assigns points to answers you provide to credit application questions. For example, your length of employment might be scored differently depending on your age.

When Evaluating Your Income, A Creditor May Not…

Refuse to consider public assistance income the same way as other income.

Discount income because of your sex or marital status. For example, a creditor cannot count a mans salary at 100 percent and a womans at 75 percent. A creditor may not assume a woman of childbearing age will stop working to raise children.

Discount or refuse to consider income because it comes from part-time employment or pension, annuity, or retirement benefits programs.

Refuse to consider regular alimony, child support, or separate maintenance payments. A creditor may ask you to prove you have received this income consistently.

You Also Have The Right To…

Have credit in your birth name (Mary Smith), your first and your spouses last name (Mary Jones), or your first name and a combined last name (Mary Smith-Jones).

Get credit without a cosigner, if you meet the creditors standards.

Have a cosigner other than your husband or wife, if one is necessary.

Keep your own accounts after you change your name, marital status, reach a certain age, or retire, unless the creditor has evidence that youre not willing or able to pay.

Know whether your application was accepted or rejected within 30 days of filing a complete application.

Know why your application was rejected. The creditor must give you a notice that tells you either the specific reasons for your rejection or your right to learn the reasons if you ask within 60 days.

Acceptable reasons include: “Your income was low,” or “You havent been employed long enough.” Unacceptable reasons are: “You didnt meet our minimum standards,” or “You didnt receive enough points on our credit-scoring system.” Indefinite and vague reasons are illegal, so ask the creditor to be specific.

Find out why you were offered less favorable terms than you applied forunless you accept the terms. Ask for details. Examples of less favorable terms include higher finance charges or less money than you requested.

Find out why your account was closed or why the terms of the account were made less favorable unless the account was inactive or delinquent.

A Special Note To Women

A good credit historya record of how you paid past billsoften is necessary to get credit. Unfortunately, this hurts many married, separated, divorced, and widowed women.

There are two common reasons women dont have credit histories in their own names: they lost their credit histories when they married and changed their names; or creditors reported accounts shared by married couples in the husbands name only.

If youre married, divorced, separated, or widowed, contact your local credit bureau(s) to make sure all relevant information is in a file under your own name.

If You Suspect Discrimination…

Complain to the creditor. Make it known youre aware of the law. The creditor may find an error or reverse the decision.

Check with your state Attorney General to see if the creditor violated state equal credit opportunity laws. Your state may decide to prosecute the creditor.

Bring a case in federal district court. If you win, you can recover damages, including punitive damages. You also can obtain compensation for attorneys fees and court costs.

An attorney can advise you on how to proceed.

Join with others and file a class action suit. You may recover punitive damages for the group of up to $500,000 or one percent of the creditors net worth, whichever is less.

Report violations to the appropriate government agency. If youre denied credit, the creditor must give you the name and address of the agency to contact. While some of these agencies dont resolve individual complaints, the information you provide helps them decide which companies to investigate.

Have you ever been faced with the worry that your son or daughter is off to college and you want to give them access to emergency cash without having to give them the actual cash which theyll likely spend beforehand but knowing by the time you wire the money to them the emergency may well be over? If so, you may well want to know what supplemental credit cardholders are!

In short, supplemental credit cardholders are persons who you authorize to use your credit card account. They are issued their own card, but the account is the same number as yours and any transactions they process on the card are charged to you. Collectively you all have the same credit card limit. As such, if your supplemental cardholder makes a purchase on the card, this reduces your access to that sum from your card limit until such time as you have made a payment.

As you can see then, supplemental credit card users are offered all of the privileges of being credit cardholders, but based on your financial status rather than theirs. They are, therefore, a good means of providing security to your spouse and children without the worry of their having to apply for a credit card in their own name which, in the case of your children, will almost certainly result in them having a lower spending limit anyhow.

Although a very useful and beneficial tool, a couple of issues you need to watch out for if you agree to supplemental credit cardholders on your account:

* you are liable for their spending! If they overspend, so do you! Also, you should request that provide you with any transaction receipts so that you can track any potential fraudulent use of the card.
* you may find that you are charged a fee for the privilege of having supplemental cardholders.

Finally, keep in mind that the policy of having supplemental cardholders is not limited to supplemental credit cardholders and it is possible to have supplemental cardholders for most major charge cards and store cards.