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Credit Score Secrets Part 1 – Debt to Credit Ratios

admin — Fri, 23 Apr 2010 18:58:26 +0000

When working with people on credit issues and dealing with the complexities of a credit report score, one notices without question that the debt to credit ratio is important. The debt to credit ratio can have a huge effect on that important home or auto loan or that needed business loan. However when balanced correctly, in accordance with the set standards for good credit from the credit reporting agencies, the debt to credit ratio can provide the much needed improvement for your current credit score.

People are constantly commenting on what a good idea it is to make sure and pay off all of your cards every month in full to make sure to establish good credit and show that one can pay their bills. This is such a misconception and only leads to confusion. Having a revolving balance kept at the right percentage compared to your debt and you are on your way to a better credit report.

Learning about your debt to credit ratio can be one of the important steps to putting yourself in the right frame of mind for credit success. For most Americans the debt to credit ratio is to high and it can be hard to obtain any new offers or loans from banks or financial institutions. For example, you have resolving accounts totaling $10,000 but you currently owe $8,000 which gives you an eighty percent ratio, very high for a buyer of a finance deal to even take a second look at you.

Lenders make the bulk of their money through charging interest, not sending out pretty square cards or annual fees. When looking at any model designed for credit scoring, it likes you to maintain your balances and pay over a length of time and it is driven with your ability to do this, amongst other things.

Being a lender in an institution, if I could see that over a long period of time, you had been able to maintain long-term credit worthiness with a company, it would prompt me to want your business and “interest” as well. As a lender, I know the type of customer that I want to solicit my loans to.

Sub-prime Merchandise Cards can be a great way to balance your debt to credit ratio while still warranting that $350 purchase for that lamp you HAD to have at Macy’s. Sub-Prime Merchandise Cards are simply cards carrying a line of credit to buy merchandise from a specific merchant which in most cases turns out to be the company who originally sold you the card.

Some marketers, perhaps due to their obvious benefits to the consumer, have started to market these cards while misrepresenting and misunderstanding how they work in their advertising campaigns. Sub Prime Merchandise Cards report to one or more of the three credit reporting agencies and can help to even out your percentages quickly when it comes to debt to credit ratio.

By: Amy Pedersen

Credit Cards for Bad Credit – Rebuilding

admin — Mon, 19 Apr 2010 01:57:50 +0000

Needing credit cards for bad credit can be a real pain. It can really take a toll on your life and make you feel like you will never rise above it, that will always be a part of your life and gone are the days of loans, credit cards, and other forms of credit. This does not have to be true. Many companies in the world today understand that sometimes things beyond our control happen and we all need a second chance at rebuilding our lives. This is why some companies are now offering credit cards for bad credit.

These credit cards for bad credit are specific to those who have a tarnished credit history for one reason or another. Your credit score might be low because of bad decisions, loss of employment, reduction in wages, injury, or a host of many other things. However, everyone deserves a second change to prove themselves credit worthy once again. This is where credit cards for bad credit come in handy.

With these credit cards, even though you will have to pay an extremely high rate of interest on the card, are perfect for those looking to rebuild their credit and improve their credit ratings. While you will likely not have many of the same benefits as traditional credit cards such as, rewards, long grace periods, or even long introductory periods, you will still have the opportunity get your financial affairs back on the right track.

Credit cards for bad credit can be found on the internet. It is important that you do your homework and find the right credit cards for bad credit that suits your needs and situation. Using the internet for research is a great place to start. Check out the interest rates and benefits before you start applying for any credit cards for bad credit. Ideally, you will want to find a credit card that periodically checks your credit report. This way, if you are improving your credit rating, making your payments on time, and showing credit worthiness, they may consider lowering your interest rates or raising your credit line.

By: Blake C. Hendrickson

Which Credit Bureau Should I Use To Check My Credit Report?

admin — Sat, 17 Apr 2010 08:23:27 +0000

There are three main credit bureaus in the United States; Equifax, Experian and Trans Union. Each bureau collects your personal and financial information which is then sold to lenders such as banks, credit unions, credit card companies, mortgage and auto loan lenders. Your credit report is the product of this collected information. Lending and credit companies use your credit information to determine if they will approve you or not and at what interest rate you will pay.

Many people are recognizing the importance of checking their own credit report to verify its accuracy and to make sure that they know where they stand in the credit world. Until they begin the process to obtain a copy of their credit report, some people do not realize that they actually have three credit reports instead of just one. The three main credit bureaus keep separate credit records from one another and produce their own credit reports. Instead of the credit bureaus working together and sharing information among themselves like some people may think, they are actually competitors. That is why the information provided on one credit report will more than likely be different from the information provided on the credit report from another credit bureau. Therefore, it is recommended to check your credit report from all three credit bureaus in order to see the complete picture.

There are a couple of options to checking all three of your credit reports. You can contact each of the credit bureaus individually to request a copy. Or you can go through one of the many companies that provide a 3-in-1 credit report like [http://www.credit-report-credit-score.com]. Obtaining a 3-in-1 credit report is usually more convenient and user friendly to the consumer compared to requesting individual copies.

Verifying the data on all three of your credit reports is the only way to know that the information that potential lenders and creditors are evaluating you on is correct. When considering you for a loan, some lenders will pull your credit report from only one or two of the credit bureaus while other lenders will pull your credit report from all three. It is always a good idea to check your credit reports BEFORE applying for your next big purchase. Covering your bases beforehand can often times save you a lot of time and hassle during the application process.

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By: Beth Pardue

Instant Online FICO Score Credit Rating

admin — Fri, 16 Apr 2010 08:59:43 +0000

Your FICO score is the same as your credit score. It ranges from 300 -850, the higher the FICO score the better. This means that a higher FICO score makes your financial reputation appear less risky to banks, resulting in you higher chances of lower interest on your loans. This rating is most frequently used when clients apply to a bank for a mortgage. Having a higher credit rating will allow you to receive better interest rates and terms on your loan.

An average FICO score is from 700 to 720, if you are within the range then more banks would approve your loan. The computation of your score is based on your payment history, current amount of debt, length of financial history, number of consumer credit cards, and whether you have defaulted on any previous debts. As mentioned a previously, the range is from 300 to 850, and anything below 600 is considered to be a bad credit history and scores higher than 600 are usually viewed as a good credit line.

Because the Internet is a place of endless possibilities, you can now receive your FICO score through several different websites. This is excellent news to anyone who is curious about their own credit history, especially if you suspect you may need to to improve your financial reputation. All you need to do is make a request from an online credit bureau to receive your credit report. This will give you the chance to look over the contents, and check for any errors, fraudulent activity such as identity theft, and out of date information.

By: Zach Ford

Bad Credit Credit Cards – Pros And Cons

admin — Wed, 14 Apr 2010 18:58:44 +0000

In modern society, many people have adopted a buy now and pay later mentality about purchasing. This has caused problems for many people when they fall on hard times and are unable to pay their bills. This problem has come to the attention of some lenders who have developed a range of bad credit credit cards to accommodate people who fall into this financial category.

Bad credit credit cards have benefits for both the lenders and the consumers. Lenders have noticed the potential to charge higher interest rates, raise fees and increase profits making this business very lucrative for them. These cards help many customers to increase credit score and have returned purchasing power back to those who otherwise would have no other options.

There are many types of credit cards for consumers to choose from like prepaid, secured, and unsecured. Prepaid cards are generally just a debit card where the consumer is able to deposit his or her own funds. These cards have no effect on credit score and are not reported to credit agencies. As convenient as prepaid cards are to have, they are not helpful in rebuilding your credit.

When trying to rebuild your credit, think about secured credit cards. These cards are secured by funds that you deposit in to a savings account. This protects you the consumer from getting in over your head, and also protects the credit card company to know that they will receive the funds if you are unable to pay your debt back. These companies will typically report to a credit agency.

Having trouble establishing credit? Bad credit credit cards can be your answer. They are frequently unsecured, but have a higher interest rate and fees for late charges. Keeping your payments paid will not only increase your credit rating but will also raise your credit line which more often than not starts at around $500.

Customers should decide carefully when choosing a credit card. Be sure to find a card that suits your current needs and that also has terms and conditions that are favorable to the customer. Check your online credit score regularly to ensure that your score is being correctly reported.

By: Daniel Lesser