In many instances, through no fault of our own, we get a less than perfect credit rating. We can lose our jobs, have lay offs, have an unexpected medical emergency and find ourselves in a tight spot. These situations and numerous more are common to so many today. Do not give up! Any one can recover and get a good credit rating. There are many credit cards that can help you recover a good credit rating. Here are a few tips on how to achieve that goal.
1. When applying for a card read the fine print.
2. Check the annual fee. Some cards have a fee and some do not. Compare offers and try to get a card with no fee.
3. The APR can sneak up and bite you. This is the interest charged so be aware of what will happen if you carry a balance.
4. Use discipline when using your card. Charge items that you will pay for in your regular budget. Then pay it off at the end of the month. Remember, your goal is to reestablish your credit. According to the credit bureaus this on time payment is very important.
5. Secured cards are a good option. These cards are secured by a deposit made by the card holder into an account specifically for that card. These cards are also great for first time card holders with no credit or students.
6. Some cards have maximum limits. Some as low as $200, Rebuilding your credit will take some time so be patient.
7. Be sure to check the annual fee charges. If your maximum limit is only $200 and your annual fee is $100 it may not make good sense to apply for that card.
There are many offers to choose from but be aware of the fine print. Use common sense to make decisions about your choices. Be a disciplined purchaser and use the opportunity for your benefit.
By: William Sears
Posts Tagged ‘Credit Bureaus’
How to Interpret Credit Score Ranges
April 10th, 2010
Your credit score ranges are an important asset, and it is vital that you treat them as such. Without careful attention, it is possible for your scores to drop to the point where it would be almost impossible for you to acquire a loan of any sort. Why is this? Almost three-quarters of lenders pay close attention to your credit score when you apply for a loan. More than anything else, these scores affect what sort of loan terms and interest rates that you will be able to obtain, for the scores are the only “you” that a lender will see. Never underestimate the importance of your credit record, for it determines many other important things, such as:
Mortgage types available when you buy a home Down payment amounts Car Loans Insurance premiums Whether or not you will be hired for a job you are seeking
Of course, in order to be able to interpret your credit worthiness score, you have to have a copy of your credit report, which you can get by contacting one of the “big three” credit bureaus. Once you have this report in hand, it’s time to look at your stats and see how you stand.
How High Can A Credit Score Go?
Credit scores can range from a high of 850 to a low of 300. Of course, the higher the score, the more likely you are to get a great interest rate and approval for a loan. With a score of 700 or above, most lenders will see you in a very favorable light, for your credit to be considered in the category of Excellent to Very Good. Depending on how much over 700 your score is, some lenders will offer you even better rates than the 700 and below score crowd receives.
A score of 680 to 699 means that your credit is considered to be Good. You aren’t considered as a credit risk with this score, but you won’t get offered the lowest of interest rates like those with higher scores.
The range of 620 to 679 is considered to be OK. It’s not low enough to get you denied for a loan, but you will definitely not have the best terms.
A score of 580 to 619 is considered to be Low. With this low of a score, you are teetering on the edge. You are almost at the point where you can’t get a loan at all. Loan officers will manage to work with you, but the loan will definitely be more expensive for you in terms of interest. And, you won’t have much of a choice, as if you want the loan, you’ll have to pay the price.
The range of 500 to 580 is considered to be quite low. If you are in need of a loan with a score this low, you will only be able to get a specialized type of secured loan tailored to people with bad credit.
If your credit score ranges between 499 and 300, you really should consider credit counseling or a debt management program. But, take heart – with a little diligence, you can raise your credit rating and improve your credit report.
By: Ann Richter
The Perfect Credit Dispute Letter
April 7th, 2010
The key to repairing your bad credit is the Credit Dispute Letter. You’ve put so much effort (probably a lot of cash too) into eliminating old debts and creating good credit but if you want to rewrite history, credit-wise, you’ve got to convince the credit bureaus to take the eraser to your past. Getting the letter just right requires a lot more than perfect prose. As is so often true with life, success can come from what you don’t say, what you do, how you say it and never forget… timing.
When composing a Credit Dispute Letter remember the old adage: Less it more. Your letter isn’t meant to convince anyone but to point out errors. You are not saying “why” a debt is not listed accurately on your report, but rather “what” is not listed accurately. Start with a simple statement that will explain what you want the the credit bureau to do: On reviewing my credit report, I haved found these discrepancies. Please delete them from my credit report within 30 days as required by law and send me a report of the corrections” – that pretty much sums up everything, doesn’t it. The fact is you don’t need to beg them to remove old credit items, it is there legal responsibility to research anything you say is incorrect and IF they can’t prove it true they must delete it.
Now list virtually everything that could hurt your credit worthiness. It is up to you to decide if you want an item on your report but they probably won’t delete everything, so be aggressive. List the creditor, account number and amount of each item you would like gone. Use no more than three words of explaination: “account never late”, “duplicated account”, or “reported in error” should cover 90% of disputed items. Never say that a credit blemish is from fraud or criminal activity because you are saying that it is reporting true and you will have to prove you aren’t to blame. Say as little as possible.
It is the credit bureaus responsibility to act within 30 days but you want them to know when the clock starts. Send any Credit Dispute Letters certified mail with a signature required. From the moment someone signs for that letter they have 30 days to contact the reported creditors and get a written verification of the bad credit items. Time is on your side and you want the bureaus to know that.
By: Mitchell Torek
