Fix Bad Credit

Don't you ever feel that's the only thing you can think of? While driving, at work, talking to people, anywhere you go your mind just fixates into "fix bad credit repair bad credit bankruptcy do it". Wouldn't you like that to stop? I know more than a couple of million people who do.

Having bad credit is terrible; it's like having a leash around your neck every time you go to a mall, look at a commercial or read an ad. There are ways to get out of a bad credit situation but they tend to be difficult, so you should be prepared.
Important Facts


Did you know that three out of ten credit reports have erroneous data on them? Yes sir. But then again, with all the amount of information that floods the three credit bureaus - TransUnion, Equifax, and Experian - one, two, or three mistakes isn't that uncommon. Plus they don't get anything for maintaining correct records. They are just being paid to maintain the necessary data, whether it's accurate or not.
Having said that, you are free to call them, review your credit reports, locate your problem, and solve them. Did you know that if you have had credit denied you are entitled for a free credit report? Aren't things starting to look better? The phone numbers are listed in any phone book or you can just ask your bank for them as well.
Act
Having bad credit isn't like having just a bad taste in your mouth; it's the real deal. Banks and any other financial institutions will look at you as a risk, making them think many times before they grant you credit, resulting in denied credit most of the times. For this matter you must begin fixing your bad credit as soon as possible.

Increase Your Credit Score

Over 30 million Americans have less than perfect credit report ratings. There are a lot of consumers out there looking to increase their credit scores.

You can tell this simply by observing how many advertisements there are out there for quick and easy credit repair. These companies are hoping that you are looking for a quick fix to your problems.

But there is no quick way to change your credit report. If it is accurate, then you can't remove the negative. No company can repair your credit rating simply by you paying them.

The rules are the same for everyone. You simply have to understand what makes up your credit rating.

 

Your credit score is a number between 300 and 850 that shows your credit worthiness. If you have a low score, you are at high risk for defaulting on a loan. If you have a high score, chances are you won't default. Your lenders, landlords, insurance companies and others use your credit score to determine whether or not to do business with you.

You should start by looking at your credit report. Many people have much better credit than they assume. You can receive a free copy of your credit report from each of the three major credit reporting agencies -- Equifax, Experian and TransUnion -- once a year. You can go to annualcreditreport.com for more information.

Contrary to popular belief, each credit reporting agency does not have the same information about you. You must look at all three reports. Each agency gets information from different lenders and different lenders report to different agencies. There are often mistakes that show up one one report, but not the other two. You need to look at all three to make sure they are accurate.

Once you have your credit reports, make sure all the information is accurate. If something is wrong, you need to take the time to correct the information. Once everything is correct, you can start improving your rating.

The number one thing that will improve your credit score is paying all your bills on time. This accounts for up to 35% of your credit score. Your recent payment history can have more effect on your score than your past history. This means that if you pay all your payments on time, you can improve your score in as little as a year. This is the easiest way to get a higher credit score.

It goes both ways. If you miss a couple of payments, your score will go down. Even those with perfect records can see their score drastically drop if they miss a few payments. Many credit card companies will use what is on your report to raise your interest rate. So you don't have to miss a payment to them, just to anyone who reports to the credit reporting agencies. You have to make your payments on time.

The second thing you can do is to start reducing the debt you have. The less debt, the better your score. For those of you who use credit cards for the rewards, but pay off the balance each month, you could still be hurting your credit report. The card company may be reporting your outstanding balance before you bill is paid. This shows you have debt, even though you don't. This will lower your score. So if you use your card, you should stop for a few months before you apply for a loan.

You can improve your credit score by paying your bills on time and reducing your credit card debt. That's all that will work. It won't cost you anything. Just get to work and over time, you will see your credit score increase

Why Have A Credit Card

Ask any financial advisor and they will tell you that credit cards, in general, are not a good idea. But they aren't all completely bad. The problem isn't necessarily the card, it is the way the card is used.

The average American family has approximately $7,000 to $10,000 (or higher, by some reports) of credit card debt. For most people, credit cards are a major obstacle between them and financial security. They are just too tempting. Too easy to use. And it is too hard to get out from under them.

But if you are one of the few people who have the self control to pay off your credit card bill each month -- every month -- then credit cards could have some advantages.

 

If you pay off your bill each month, you are basically receiving an interest free loan from the time you make your purchase until your credit card bill arrives. But the key is that you have to keep a close eye on how much you are spending, you must have the money to pay it off in full. Or you will pay interest on what you can't pay.

Many credit cards offer protection for your purchases for a certain amount of time after the purchase is made. Airline tickets purchased with credit cards often offer free life and baggage insurance during your vacation. Some provide rental car insurance. A number of cards let you earn points for every $1 you charge. Others offer you cash back on your purchases. Many of these "reward" cards can be found with little to no annual fee.

The most popular of the rewards cards are the airline credit cards. These allow you to earn points toward free tickets or other upgrades with each dollar you spend. Almost all airline cards have annual fees, but these are sometimes waived for top customers. If you have used your card a lot during the year, you can request to have your fees waived.

There are many other card programs out there -- all intended to draw customers in. There are cards that pay towards your home mortgage loan. Some will donate to your favorite charity. You can find a card linked to almost anything nowadays.

The reason that credit cards take the risk that you will take an interest free loan and pay off your bill in full is simple. First of all, anytime you make a purchase with a credit card, the store you do business with must pay the credit card company anywhere between three and seven percent of the amount charged.

The other way they stay in business is by charging credit card holders who don't pay their balance each month high interest rates. These rates are even higher for those who miss a payment.

Credit cards are banking on you not paying your balance in full. The majority of their card holders don't. They encourage you to charge by offering money transfers, convenience checks and other incentives. They want you to be surprised when you receive your bill each month at how much you owe them.

But the fact is that credit cards are only a good deal if you pay off your balance in full each month and you only buy things that you have the money for at the time you buy them.

So that leaves many advisors to ask: why not just use your money and forgo all of the trouble? The benefits to the rewards cards are so minimal, they often aren't worth the risk.

While cards are the downfall of many, if you have self-control and use them wisely, there are advantages. Many people do find that they can save money by using them. Be careful and keep track of your spending, and you should find that they not only improve your credit score, but provide many other benefits as well.

How To Apply For Credit

So you need to apply for a new credit card. Well, have you thought about applying for it online?

All of the major credit card issuers, and most of the minor ones, now allow you to apply via their websites. This offers a number of advantages compared with the old method of filling in a paper form and sending it by snail mail.

One big advantage is speed. Your application will be instantly received by the card company and at least some of the processing will be handled automatically.


Admittedly the card issuer will want to make certain checks with credit reference agencies to ensure that you are creditworthy, so you shouldn't expect an immediate yes or no. However, the waiting period between applying for the card and getting approval for it is likely to be as much as a week less compared with the traditional method of application.

Another big advantage of applying for a credit card on the Internet is that it is very easy to research the best credit card offers. Nowadays there are hundreds of different credit cards available, all offering different combinations of terms and incentives. It is very important to study the market carefully, therefore, rather than simply filling in the first application form that arrives in your mailbox. Independent credit card comparison sites such as http://www.finest-credit-cards.com make this easy by listing all the best current credit card offers, updated daily.

Once you have found a card you are interested in, go to the issuer's website and study all the details of their offer. Check in particular for low introductory rates, cashback offers and balance transfer deals. If you are happy that this is indeed the card for you, look for a button labelled "Apply Now" or similar. Click on this and a new page should open, with an online application form ready for you to fill in.

The details you will be asked for are just the same as when applying for a card by mail. They will include your full name, address, telephone number, occupation, annual income, and so on. You are also likely to be asked some security questions, e.g. your date of birth, social security number and mother's maiden name. These are used to help prevent fraudulent applications.

Once you have completed the form to the best of your ability, click on Submit, and click again to confirm your application if requested. If you have omitted any information or filled in any parts of the form incorrectly, you will be asked to try again. Otherwise, you will see a message that your application has been received. All being well, you will then receive approval of your application within a few days, and the card itself shortly after that.

The Cost Of A Bad Check

Writing a bad check can really be a tough predicament. It can happen to anyone, even those who that make an effort of taking care of their money. Poor budgeting and impulsive thinking are the most common root of this financial problem. If you happen to blunder into this situation, acting quickly to resolve this problem is critical because this mistake can be costly.

While a single bad check may not be too much of a problem,


a number of them can cause havoc on your budget. You have to pay a bank fee which can range from twenty to thirty dollars or more. You may also have to pay the same price to the person or store for the inconvenience you have caused.

If your bad checks pile up, your bank account will quickly go into negative numbers and your bank may ultimately decide that you are a huge risk and close your account completely. Opening a new account will not be possible unless you repay the balance of your previous account and your bouncing check will recorded on ChexSystems alerting other banks of your infractions

Your problems can also worsen if establishments resort to legal action to retrieve their money. You may receive a call from companies that specialize in recovering bad checks, reminding you to resolve the problems with their clients as soon as possible. Bad checks will not affect only your finical situation; your reputation can also be destroyed as well. Banks will be reluctant to do any business with you and it will also diminish of job opportunities that will be available to you.

Try to avoid writing bad checks as much as you can. The problems that plague you after writing one can plague you for a long time. If an accident does happen, try to work out the problem as quickly as you can. Your future and reputation are at stake so always keep an eye out to keep your financial situation healthy.

0% Credit Cards

First of all, no credit card is going to offer 0% financing forever. Let’s just make sure that is understood that at some point after you activate your 0% APR credit card, usually 6 months, your APR will increase to whatever your credit rating dictates. If you were approved for a 0% credit card offer, then your rating is probably pretty good and your APR should be competitive.

There may be fees associated with your credit card during and after the introductory period, and we will take a look at them here:

 

Annual Fee – If your card has an annual fee, then there is no way you are going to get around it. The fee will be applied to your card either the second billing cycle after you receive the card, or the first billing cycle after your intro period. Annual fees are not as common as they used to be, and range anywhere between $15.00 to over $100.00 depending on the card. The terms and conditions will clearly define any annual fee that may apply.

Minimum Finance Charge – This is fairly self explanatory. Regardless of how much balance you leave on your credit card at the end of any billing cycle, there will be a minimum finance charge. This charge differs from card to card, but is usually around $1.00. If you have an APR of 11%, and you leave a balance of fifty cents on your card, you will be charged the minimum finance charge, in this case $1.00.

Transaction Fees For Balance Transfers – Obviously this only applies if you have made a balance transfer, but many consumers apply for 0% credit cards for the specific purpose of transferring a balance to a new card to avoid finance charges for a limited time. There will almost always be a fee applied the moment the balance transfer goes through, as well as a minimum fee. An average transaction fee is around 3% of the total amount transferred, and a common minimum fee of $10.00.

Late Payment Fee – Another self explanatory fee, this is applied anytime you make a late payment. As it relates to 0% Credit Card intro offers, if you make a late payment to your creditor, then you owe the late payment fee and your APR immediately increases to either its normal rate, or its default rate which will be much higher. The fee itself is usually determined by the amount of your current balance. An example would be “$15.00 if the balance is up to but not including $250.00; $39.00 if the balance is $250.00 and over.” This of course can differ between issuers.

Over-the-Credit-Limit Fee – This fee has become very rare in today’s market, but it’s still there. If you somehow manage to charge more than the limit of your card, which is difficult to do now that all purchases are checked electronically, then you will be assed a fee for doing so. This fee ranges around the $35.00 area, but can be much more.

International Transactions – Anytime currency is exchanged through the use of a credit card a conversion fee is levied. This means if you are on vacation in Italy and make a purchase using your American credit card, there will be an additional fee added to the transaction. This fee is usually around 3% of the dollar amount of the purchase. Don’t let the word International fool you though. You can get hit with this fee through internet purchases as well if the seller takes payment in anything other than US dollars.

None of these fees are so exorbitant that they look malicious, but they should be avoided if at all possible. Every fee you incur lessens the value of your 0% credit card and could possibly increase your APR to something you would not want.

Yearly Fees

The annual fee, or membership fee, is an amount charge card companies levy for the right to use or carry their card. This fee is payable whether you actually use the card during the year or not. Annual fees range from an average low of $25 to as much as $100 or more.

Annual fees were first popularized by prestige charge cards such as American Express and Diner’s Club. These annual charges were called Membership Fees. The charge card companies justified these fees because card holders were required to pay their balances in full every month and the companies earned no interest from the balances due.

 

The annual fee made the leap from club cards to the ordinary bank card in 1980 after the U.S. Government imposed a temporary moratorium on the solicitation of new customers for bank card companies. This was done in the hopes of cutting runaway inflation. The card issuers saw this as a chance to earn more money from their existing customer base who suddenly found themselves without any options thanks to the hastily passed government initiative.

After the moratorium was lifted, card users left the fee in place with a justification that annual fees kept interest rates low because it provided a way for the banks to offset losses from fraud and the rising number of personal bankruptcy claims. There was little outcry from the public and business went on as usual.

The first sign of trouble on the horizon came in 1990 when long-distance giant AT&T (American Telephone and Telegraph) entered the credit card industry with the hopes of offsetting their declining long distance revenues. Looking to raise the visibility of their new card in an already crowded marketplace, AT&T made a big advertising splash with their “No Annual Fee Credit Card!”

The response from consumers was overwhelming and the panic spread quickly through competing banks that were seeing their long-time credit card customers defect to upstart AT&T. That one incident, which bankers still call “The Big Scare”, marked the beginning of the end of the annual fee for most people.

Today, American Express still charges their membership fees although some of their interest-bearing products come fee-free. Most banks issue fee-free credit cards to their customers with high credit scores and save the fee-based offers for lower scoring customers and customers with scores so low that they can only qualify for secured cards.