Modern Student Based Budgeting Systems Present Their Own Unique Credit Realities
As anyone who watches the news today knows, these are unique economic times that we all live in. For a student in college today, the economic challenges that present themselves can be even more daunting and complex. For instance, one goal of any college student should be to prepare a positive credit rating so it will be there when that graduate.
Credit Cards for College Students
This of course, means that a college student must be able to design and live by a student based budgeting system that has some level of flexibility to accommodate a college students unique needs. Credit card companies now have college students directly in their field of vision. This means that just about any college student can now obtain a credit card.
Begin Building a Posetive Credit Rating
Credit cards are a double edged sword when it comes to a persons credit rating. This is because, they are a great way to build up a positive credit rating, while at while at the same time they can devistate a credit rating if not managed prudently. This means that any credit card that is integrated into a student based budgeting system should only be used as a tool to build up a positive credit rating.
Begin Early to Build a Posetive Credit Rating
It takes a few years for any positive actions to reflect on a persons credit report. With so many more people and agencies including employers and landlords now relying on a persons credit score in their decision making process, it is imperative that a good credit score be there when a student finally graduates. Waiting until one graduates to address their credit rating is a mistake that far too many college students make.
Low Introductory Interest Rates
Credit card contracts usually cover some three complete pages with fine print and are very complex. The reason for this is quite simple and that is that the issuers of the credit card don't want you to understand them. If you obtain a credit card that has a very small introductory interest rate, you must make all of your payments on time or early, or your rate will shoot up and that includes any payments you make such as your car payment.
By Expert Author: Donald Renal
Article Source: http://www.articlesphere.com/
วันศุกร์ที่ 7 พฤศจิกายน พ.ศ. 2551
Modern Student Based Budgeting Systems Present Their Own Unique Credit Realities
Modern Student Based Budgeting Systems Present Their Own Unique Credit Realities
As anyone who watches the news today knows, these are unique economic times that we all live in. For a student in college today, the economic challenges that present themselves can be even more daunting and complex. For instance, one goal of any college student should be to prepare a positive credit rating so it will be there when that graduate.
Credit Cards for College Students
This of course, means that a college student must be able to design and live by a student based budgeting system that has some level of flexibility to accommodate a college students unique needs. Credit card companies now have college students directly in their field of vision. This means that just about any college student can now obtain a credit card.
Begin Building a Posetive Credit Rating
Credit cards are a double edged sword when it comes to a persons credit rating. This is because, they are a great way to build up a positive credit rating, while at while at the same time they can devistate a credit rating if not managed prudently. This means that any credit card that is integrated into a student based budgeting system should only be used as a tool to build up a positive credit rating.
Begin Early to Build a Posetive Credit Rating
It takes a few years for any positive actions to reflect on a persons credit report. With so many more people and agencies including employers and landlords now relying on a persons credit score in their decision making process, it is imperative that a good credit score be there when a student finally graduates. Waiting until one graduates to address their credit rating is a mistake that far too many college students make.
Low Introductory Interest Rates
Credit card contracts usually cover some three complete pages with fine print and are very complex. The reason for this is quite simple and that is that the issuers of the credit card don't want you to understand them. If you obtain a credit card that has a very small introductory interest rate, you must make all of your payments on time or early, or your rate will shoot up and that includes any payments you make such as your car payment.
By Expert Author: Donald Renal
Article Source: http://www.articlesphere.com/
As anyone who watches the news today knows, these are unique economic times that we all live in. For a student in college today, the economic challenges that present themselves can be even more daunting and complex. For instance, one goal of any college student should be to prepare a positive credit rating so it will be there when that graduate.
Credit Cards for College Students
This of course, means that a college student must be able to design and live by a student based budgeting system that has some level of flexibility to accommodate a college students unique needs. Credit card companies now have college students directly in their field of vision. This means that just about any college student can now obtain a credit card.
Begin Building a Posetive Credit Rating
Credit cards are a double edged sword when it comes to a persons credit rating. This is because, they are a great way to build up a positive credit rating, while at while at the same time they can devistate a credit rating if not managed prudently. This means that any credit card that is integrated into a student based budgeting system should only be used as a tool to build up a positive credit rating.
Begin Early to Build a Posetive Credit Rating
It takes a few years for any positive actions to reflect on a persons credit report. With so many more people and agencies including employers and landlords now relying on a persons credit score in their decision making process, it is imperative that a good credit score be there when a student finally graduates. Waiting until one graduates to address their credit rating is a mistake that far too many college students make.
Low Introductory Interest Rates
Credit card contracts usually cover some three complete pages with fine print and are very complex. The reason for this is quite simple and that is that the issuers of the credit card don't want you to understand them. If you obtain a credit card that has a very small introductory interest rate, you must make all of your payments on time or early, or your rate will shoot up and that includes any payments you make such as your car payment.
By Expert Author: Donald Renal
Article Source: http://www.articlesphere.com/
The Way To Get Back To Normal Bad Credit History
The Way To Get Back To Normal Bad Credit History
For people with bad credit history, it's already a tough road trying to own a car or a real estate. Low credit score is avoided like plague by general bunch of bankers, but a handful of other financers are always ready to give credit cards to people with bad credit history. Help you to improve your poor credit score is not as easy, but its possible.
The first thing you have to do is to obtain and review your credit report from each of the three national credit bureaus - Experian, Equifax and TransUnion - and make sure, if the data containted in these reports is accurate. Any information that is not accurate should be reported right away to the national bureau reporting the inaccurate information.
Then you have to to understand, that you have some options to recover your lost credit score points, but bad credit history recover can take some time. When you are trying to achieve bad credit history repair, you may run into a number of some disappointments and frustrations, however, if you do fall into bad credit, it is important that bad credit history recover is implemented. So this is why bad credit history repair is so important. The most important factor of improving bad credit history is - maintaning regular punctual payments to your credit card company. Begin by deciding on a realistic payment schedule that will allow you to begin repaying delinquent debt at the same time continuing to maintain a positive status with those lenders with whom you are still in good standing. You'll find that most creditors and collection agencies will be happy work with you to set up a reasonable payment plan.
Poor credit score is not a problem, if nessesary steps are initiated, but each action should be taken cautiously. It's real to get your visa back when you spoiled you credit score, but its gonna be not easy. The credit card issuers work with understand that a poor credit score can be hard to overcome. That's why you can and should fill application for debit credit cards, maintain their balance and show your lenders, that you are trusworthy. Any day, they will offer you a regular credit card with no security deposit. That's how you can reach the goal: take responsibility and your lenders will love you again.
By Expert Author: Michael Huch
Article Source: http://www.articlesphere.com/
For people with bad credit history, it's already a tough road trying to own a car or a real estate. Low credit score is avoided like plague by general bunch of bankers, but a handful of other financers are always ready to give credit cards to people with bad credit history. Help you to improve your poor credit score is not as easy, but its possible.
The first thing you have to do is to obtain and review your credit report from each of the three national credit bureaus - Experian, Equifax and TransUnion - and make sure, if the data containted in these reports is accurate. Any information that is not accurate should be reported right away to the national bureau reporting the inaccurate information.
Then you have to to understand, that you have some options to recover your lost credit score points, but bad credit history recover can take some time. When you are trying to achieve bad credit history repair, you may run into a number of some disappointments and frustrations, however, if you do fall into bad credit, it is important that bad credit history recover is implemented. So this is why bad credit history repair is so important. The most important factor of improving bad credit history is - maintaning regular punctual payments to your credit card company. Begin by deciding on a realistic payment schedule that will allow you to begin repaying delinquent debt at the same time continuing to maintain a positive status with those lenders with whom you are still in good standing. You'll find that most creditors and collection agencies will be happy work with you to set up a reasonable payment plan.
Poor credit score is not a problem, if nessesary steps are initiated, but each action should be taken cautiously. It's real to get your visa back when you spoiled you credit score, but its gonna be not easy. The credit card issuers work with understand that a poor credit score can be hard to overcome. That's why you can and should fill application for debit credit cards, maintain their balance and show your lenders, that you are trusworthy. Any day, they will offer you a regular credit card with no security deposit. That's how you can reach the goal: take responsibility and your lenders will love you again.
By Expert Author: Michael Huch
Article Source: http://www.articlesphere.com/
Financing College Expenses With Student Loans Or with Credit Cards?
Financing College Expenses With Student Loans Or with Credit Cards?
Students always need finance to cover the expenses of daily life. Buying books, paying for rent, groceries, services, etc. can add up to considerable amounts that must be paid somehow. The easiest way is to use a credit card; credit cards are always in hand and are a very comfortable payment method.
But what happens when you will not have enough money by the next month to pay the whole balance? Or, in other words, what if you need finance to make ends meet? Is a credit card the best source of finance or are there other options that you can turn to if you need funds to cover your expenses?
All these questions will be answered in the following paragraphs. What we want to make students understand is that finance is a serious issue that should be well thought. Rushing in and choosing the easiest path can lead to unfortunate consequences that can easily be avoided by doing a bit of research and making conscious decisions.
Other Finance Sources
The truth is that when it comes to students, lenders are more flexible and a student will be able to get finance at low interest rates without too much hassle as long as he is willing to go through the process of applying for a loan.
Many people feel that using a credit card and getting finance through it is not borrowing money, but it is. There is no difference between that and applying for a loan. So, given that either way you will owe someone money, you might as well borrow money with a lower interest rate.
Federal Loans carry the lowest interest rates when it comes to student loans. The interest rate charged for a federal loan is usually below 6%. Another benefit that comes with this kind of loans is that the repayment is deferred till graduation. Moreover, you can sometimes agree a deferment of up to a year after graduation.
Regular loans on the other hand carry somewhat higher interest rates but nevertheless lower than other unsecured personal loans. Repayment can also be deferred and payment schedules can last longer than federal loans. Also, private loans provide higher loan amounts than federal loans.
Credit Cards
If you choose to finance yourself with credit cards, you must understand that costs will be a lot higher. Unless you always pay your balance in full (in which case you would not be financing) the interest rate you will be charged for credit will be as high as 20%, let alone other charges and fees like insurance, issuing costs, etc.
Not only is the interest rate a lot higher, but it is also not fixed. So variations in market conditions may increase the interest rate charged and you will end up paying a lot more than you expected. Besides you cannot defer payment, you will have to begin to pay for your purchases the following month. And if you choose to pay the minimum you will end up accumulating debt which is a dangerous thing to do as the minimum will increase every month and you will end up being unable to pay your credit card balance.
By Expert Author: Devora Witts
Article Source: http://www.articlesphere.com/
Students always need finance to cover the expenses of daily life. Buying books, paying for rent, groceries, services, etc. can add up to considerable amounts that must be paid somehow. The easiest way is to use a credit card; credit cards are always in hand and are a very comfortable payment method.
But what happens when you will not have enough money by the next month to pay the whole balance? Or, in other words, what if you need finance to make ends meet? Is a credit card the best source of finance or are there other options that you can turn to if you need funds to cover your expenses?
All these questions will be answered in the following paragraphs. What we want to make students understand is that finance is a serious issue that should be well thought. Rushing in and choosing the easiest path can lead to unfortunate consequences that can easily be avoided by doing a bit of research and making conscious decisions.
Other Finance Sources
The truth is that when it comes to students, lenders are more flexible and a student will be able to get finance at low interest rates without too much hassle as long as he is willing to go through the process of applying for a loan.
Many people feel that using a credit card and getting finance through it is not borrowing money, but it is. There is no difference between that and applying for a loan. So, given that either way you will owe someone money, you might as well borrow money with a lower interest rate.
Federal Loans carry the lowest interest rates when it comes to student loans. The interest rate charged for a federal loan is usually below 6%. Another benefit that comes with this kind of loans is that the repayment is deferred till graduation. Moreover, you can sometimes agree a deferment of up to a year after graduation.
Regular loans on the other hand carry somewhat higher interest rates but nevertheless lower than other unsecured personal loans. Repayment can also be deferred and payment schedules can last longer than federal loans. Also, private loans provide higher loan amounts than federal loans.
Credit Cards
If you choose to finance yourself with credit cards, you must understand that costs will be a lot higher. Unless you always pay your balance in full (in which case you would not be financing) the interest rate you will be charged for credit will be as high as 20%, let alone other charges and fees like insurance, issuing costs, etc.
Not only is the interest rate a lot higher, but it is also not fixed. So variations in market conditions may increase the interest rate charged and you will end up paying a lot more than you expected. Besides you cannot defer payment, you will have to begin to pay for your purchases the following month. And if you choose to pay the minimum you will end up accumulating debt which is a dangerous thing to do as the minimum will increase every month and you will end up being unable to pay your credit card balance.
By Expert Author: Devora Witts
Article Source: http://www.articlesphere.com/
8 Consumer Credit System Myths
8 Consumer Credit System Myths
Misinformation and half-truths abound in discussions about credit reporting and scoring. People have so many different ideas about what is true when it comes to dealing with their credit that regardless of the question you ask, you are liable to get a wide variety of conflicting information.
At the end of the day, all this ignorance about the credit system does nothing but help the lenders and other financial institutions who use your credit information. If people simply knew a little more about their credit, they would be able to take steps to improve their credit. By improving their credit, people could avoid having to pay the high interest rates that pad the lenders profits.
What follows are some of the myths people believe to be true about the consumer credit system. By distancing yourself from these defeatist fallacies, you can open yourself up to learning the truth about your credit and what you can do to manage it.
1) The Myth: The big three credit bureaus (Equifax, Experian, and Trans Union) are official agencies tasked with maintaining your credit reports.
The Truth: These three companies are just that, for-profit companies. The big three credit bureaus are businesses who make money by collecting consumers financial information and then selling it to creditors, marketers, employers, and even back to you I the form of your credit reports.
2) The Myth: There law states that your creditors must report late payments, collections, charged off accounts, etc. to the credit bureaus. Once these items are added to your credit reports, they must remain on your reports for 7 years.
The Truth: The Fair Credit Reporting Act (FCRA) does not require anything to be reported to the credit bureaus. In addition, the FCRA does not list a minimum amount of time that reported items must be listed on you credit reports. It only requires that listings remain on your credit reports for no more than 7 years for most items. The truth is that your creditors can remove items from your credit reports at any time.
3) The Myth: There is nothing you can legally do to repair your credit.
The Truth: There is a wide variety of things you can do to add positive credit to and remove bad credit from your credit reports. Every law that applies to the credit bureaus is written to protect you. By taking advantage of their rights under these laws, people have forced the credit bureaus to permanently delete millions of negative items from their credit reports. For every person that claims that it is impossible to remove bad credit from your credit reports, there is another person who has already done it.
4) The Myth: It is impossible to remove accurate information from your credit reports.
The Truth: Actually, this myth is correct, but not in the way most people think. When the FTC talks about removing accurate information from your credit reports, they are using the word "accurate" in the legal sense as defined by numerous credit laws and legal decisions. To help get a better understanding of what their version of "accurate" means, it helps to know what is considered inaccurate. According to the law, inaccurate credit listings also include listings that are untimely, misleading, biased, incomplete, and unverifiable.
So yes, it is impossible to remove "accurate" negative information form your credit reports, but many of the things you think may be accurate right now you will know are actually misleading, biased, unverifiable, etc. once you learn more about the consumer credit laws.
5) The Myth: It doesn't matter if something gets removed from your credit reports, it will just come back.
The Truth: While it is possible for a deleted item to reappear on your credit reports, it is rare. The FCRA makes it more difficult from the credit bureaus to re-report an item to help protect you from having to continually dispute the same items over and over again.
6) The Myth: It is illegal for anyone to repair your credit for you.
The Truth: You have the right to enlist the help of a credit repair professional if you so choose. In fact, U.S. District Court Judge, J. Wexler said about credit repair companies that "since allowing third parties to assist consumers will likely lead to the expedited correction of credit reports, it will further the purposes of the [fair credit reporting] acts."
7) The Myth: There is no reason to use a credit repair company because you can repair your own credit for free.
The Truth: While people point out that you can save money by repairing your own credit, they rarely mention the other costs associated with repairing your own credit reports. Aside from the material costs of mailing certified letters (a practice that is recommended by most credit repair experts), many people also have to spend a significant amount of time learning about the various credit laws, learning the tactics for writing effective dispute letters, dealing with credit bureau stall letters and information requests, and other tasks associated with managing the credit repair process.
When considering all the costs involved with repairing their own credit, many people find that it is more than worth the money to have someone else repair their credit for them.
8) The Myth: Repairing your own credit is easy.
The Truth: For a few people, repairing their credit is easy. Most people find out that the opposite is true. Remember that lenders want to keep your credit score low and the credit bureaus do not want to deal with you because there is no money in it. The law may be on your side, but these organizations are not and they will work to make the credit repair process difficult. People may say that all you have to do is write a dispute letter and send it to the credit bureaus. But what do you do when this doesn't work for you? At that point, the real work of credit repair begins.
To illustrate the difficulty of repairing your own credit, consider that, according to a survey of over 2,000 Lexington Law credit repair clients, almost 40% had attempted to repair their credit on their own before enlisting the help of the firm.
By Expert Author: Stuart Hunter
Article Source: http://www.articlesphere.com/
Misinformation and half-truths abound in discussions about credit reporting and scoring. People have so many different ideas about what is true when it comes to dealing with their credit that regardless of the question you ask, you are liable to get a wide variety of conflicting information.
At the end of the day, all this ignorance about the credit system does nothing but help the lenders and other financial institutions who use your credit information. If people simply knew a little more about their credit, they would be able to take steps to improve their credit. By improving their credit, people could avoid having to pay the high interest rates that pad the lenders profits.
What follows are some of the myths people believe to be true about the consumer credit system. By distancing yourself from these defeatist fallacies, you can open yourself up to learning the truth about your credit and what you can do to manage it.
1) The Myth: The big three credit bureaus (Equifax, Experian, and Trans Union) are official agencies tasked with maintaining your credit reports.
The Truth: These three companies are just that, for-profit companies. The big three credit bureaus are businesses who make money by collecting consumers financial information and then selling it to creditors, marketers, employers, and even back to you I the form of your credit reports.
2) The Myth: There law states that your creditors must report late payments, collections, charged off accounts, etc. to the credit bureaus. Once these items are added to your credit reports, they must remain on your reports for 7 years.
The Truth: The Fair Credit Reporting Act (FCRA) does not require anything to be reported to the credit bureaus. In addition, the FCRA does not list a minimum amount of time that reported items must be listed on you credit reports. It only requires that listings remain on your credit reports for no more than 7 years for most items. The truth is that your creditors can remove items from your credit reports at any time.
3) The Myth: There is nothing you can legally do to repair your credit.
The Truth: There is a wide variety of things you can do to add positive credit to and remove bad credit from your credit reports. Every law that applies to the credit bureaus is written to protect you. By taking advantage of their rights under these laws, people have forced the credit bureaus to permanently delete millions of negative items from their credit reports. For every person that claims that it is impossible to remove bad credit from your credit reports, there is another person who has already done it.
4) The Myth: It is impossible to remove accurate information from your credit reports.
The Truth: Actually, this myth is correct, but not in the way most people think. When the FTC talks about removing accurate information from your credit reports, they are using the word "accurate" in the legal sense as defined by numerous credit laws and legal decisions. To help get a better understanding of what their version of "accurate" means, it helps to know what is considered inaccurate. According to the law, inaccurate credit listings also include listings that are untimely, misleading, biased, incomplete, and unverifiable.
So yes, it is impossible to remove "accurate" negative information form your credit reports, but many of the things you think may be accurate right now you will know are actually misleading, biased, unverifiable, etc. once you learn more about the consumer credit laws.
5) The Myth: It doesn't matter if something gets removed from your credit reports, it will just come back.
The Truth: While it is possible for a deleted item to reappear on your credit reports, it is rare. The FCRA makes it more difficult from the credit bureaus to re-report an item to help protect you from having to continually dispute the same items over and over again.
6) The Myth: It is illegal for anyone to repair your credit for you.
The Truth: You have the right to enlist the help of a credit repair professional if you so choose. In fact, U.S. District Court Judge, J. Wexler said about credit repair companies that "since allowing third parties to assist consumers will likely lead to the expedited correction of credit reports, it will further the purposes of the [fair credit reporting] acts."
7) The Myth: There is no reason to use a credit repair company because you can repair your own credit for free.
The Truth: While people point out that you can save money by repairing your own credit, they rarely mention the other costs associated with repairing your own credit reports. Aside from the material costs of mailing certified letters (a practice that is recommended by most credit repair experts), many people also have to spend a significant amount of time learning about the various credit laws, learning the tactics for writing effective dispute letters, dealing with credit bureau stall letters and information requests, and other tasks associated with managing the credit repair process.
When considering all the costs involved with repairing their own credit, many people find that it is more than worth the money to have someone else repair their credit for them.
8) The Myth: Repairing your own credit is easy.
The Truth: For a few people, repairing their credit is easy. Most people find out that the opposite is true. Remember that lenders want to keep your credit score low and the credit bureaus do not want to deal with you because there is no money in it. The law may be on your side, but these organizations are not and they will work to make the credit repair process difficult. People may say that all you have to do is write a dispute letter and send it to the credit bureaus. But what do you do when this doesn't work for you? At that point, the real work of credit repair begins.
To illustrate the difficulty of repairing your own credit, consider that, according to a survey of over 2,000 Lexington Law credit repair clients, almost 40% had attempted to repair their credit on their own before enlisting the help of the firm.
By Expert Author: Stuart Hunter
Article Source: http://www.articlesphere.com/
Personal Lines Of Credit Instead Of Overdraft Agreements
Personal Lines Of Credit Instead Of Overdraft Agreements
Almost everyone with a bank account has obtained an overdraft agreement and uses it from time to time when they find themselves short on cash. However, what not everybody knows is that overdraft agreements tend to carry high interest rates and though the amount are not significant, if you use it often it may cost you thousands of dollars over the year. Personal Lines of Credit are a much cheaper alternative that must be considered.
The fees charged for overdraft can be considerably high and you should know that there are other options available for getting some ease when you run out of cash by the end of the month. Personal lines of credit can be easily obtained and the interest rates charged for them compared to the overdraft fees are insignificant.
Concept Of Overdraft
An overdraft is the amount by which withdrawals or payments against an account exceed the deposits available in it. An overdraft agreement is the extension of credit by a lending institution that allows such withdrawals without penalty fees. Most overdraft agreements have costs that are usually charged in the form of fees.
Nevertheless, there are certain accounts that include all costs in the same fee. Thus the fee you pay includes maintenance charges, card issuing charges, overdraft charges, etc. Other accounts charge an interest rate over the amount you withdraw exceeding your deposits. These ones usually allow for higher withdrawals, usually up to $2000 or more.
Concept Of Line Of Credit
A line of credit is a revolving account with a certain credit limit defined at the time of approval by the lender. Up to this specified limit, the borrower can withdraw as much money as needed. If the limit is surpassed, the account is blocked and no more money can be withdrawn even after repayment unless the lender authorizes further transactions.
Repayment is not fixed either. Though there is a minimum payment usually consistent of interest on the money withdrawn, the borrower can repay the amount he wants at any time. That money becomes available again for him to withdraw if needed. The borrower can withdraw as much money as he wants and as many times as he needs provided he does not exceed the pre-defined limit.
Types Of Lines Of Credit
Lines of credit can be secured or unsecured. Secured lines of credit are usually guaranteed with equity just like mortgage loans or home-equity loans. These lines of credit carry incredibly low interest rates which turns them into an inexpensive and flexible financing tool for those who need credit at non-defined times.
Unsecured lines of credit carry higher interest rates and thus are not the best option. Nevertheless, the rate charged for unsecured lines of credit is lower than the one charged for overdraft agreements in most cases. All lines of credit however, secured or unsecured carry variable interest rates that can change according to market variations.
Lines of credit offer a lot more flexibility than overdraft agreements because the amounts in terms of credit are generally larger. Besides, the interest rate is significantly lower which turns them into a much cheaper alternative for satisfying your cash needs. And though they carry the risk of repossession, among lines of credit, home equity lines of credit are undoubtedly the best choice.
By Expert Author: Melissa Kellett
Article Source: http://www.articlesphere.com/
Almost everyone with a bank account has obtained an overdraft agreement and uses it from time to time when they find themselves short on cash. However, what not everybody knows is that overdraft agreements tend to carry high interest rates and though the amount are not significant, if you use it often it may cost you thousands of dollars over the year. Personal Lines of Credit are a much cheaper alternative that must be considered.
The fees charged for overdraft can be considerably high and you should know that there are other options available for getting some ease when you run out of cash by the end of the month. Personal lines of credit can be easily obtained and the interest rates charged for them compared to the overdraft fees are insignificant.
Concept Of Overdraft
An overdraft is the amount by which withdrawals or payments against an account exceed the deposits available in it. An overdraft agreement is the extension of credit by a lending institution that allows such withdrawals without penalty fees. Most overdraft agreements have costs that are usually charged in the form of fees.
Nevertheless, there are certain accounts that include all costs in the same fee. Thus the fee you pay includes maintenance charges, card issuing charges, overdraft charges, etc. Other accounts charge an interest rate over the amount you withdraw exceeding your deposits. These ones usually allow for higher withdrawals, usually up to $2000 or more.
Concept Of Line Of Credit
A line of credit is a revolving account with a certain credit limit defined at the time of approval by the lender. Up to this specified limit, the borrower can withdraw as much money as needed. If the limit is surpassed, the account is blocked and no more money can be withdrawn even after repayment unless the lender authorizes further transactions.
Repayment is not fixed either. Though there is a minimum payment usually consistent of interest on the money withdrawn, the borrower can repay the amount he wants at any time. That money becomes available again for him to withdraw if needed. The borrower can withdraw as much money as he wants and as many times as he needs provided he does not exceed the pre-defined limit.
Types Of Lines Of Credit
Lines of credit can be secured or unsecured. Secured lines of credit are usually guaranteed with equity just like mortgage loans or home-equity loans. These lines of credit carry incredibly low interest rates which turns them into an inexpensive and flexible financing tool for those who need credit at non-defined times.
Unsecured lines of credit carry higher interest rates and thus are not the best option. Nevertheless, the rate charged for unsecured lines of credit is lower than the one charged for overdraft agreements in most cases. All lines of credit however, secured or unsecured carry variable interest rates that can change according to market variations.
Lines of credit offer a lot more flexibility than overdraft agreements because the amounts in terms of credit are generally larger. Besides, the interest rate is significantly lower which turns them into a much cheaper alternative for satisfying your cash needs. And though they carry the risk of repossession, among lines of credit, home equity lines of credit are undoubtedly the best choice.
By Expert Author: Melissa Kellett
Article Source: http://www.articlesphere.com/
Release Your Home Equity And Relax
Release Your Home Equity And Relax
If you are in desperately need of cash and you can not get approved for unsecured loans due to your bad credit history, you needn’t get depressed or despair. Home equity loans can provide you with all the financing you need at very reasonable rates and with loan installments you will be able to afford with ease.
Home equity loans have so advantageous terms that more and more people are requesting them everyday. It is such a simple finance solution that homeowners have nothing to worry about if something unexpected happened and they need extra cash to cope with it. They just need to request a home equity loan, sit down and relax.
Equity Provides Larger Loan Amounts
When requesting a home equity loan, you can be confident to get larger loan amounts than with unsecured loans. Provided that you have sufficient equity on your home, you will be able to get up to 85% or 90% financing on your home value. Only those with perfect credit can aspire to obtain 100% financing or even more.
If you have $40,000 of equity left on your home, you will not be able to get that total amount unless you have perfect credit. The amount of your home loan and the amount of you home equity loan added up usually can reach up to 85% of the home value. Thus, if you have an outstanding mortgage of $60,000, you will be able to get only $25,000 on your home equity loan.
Equity Provides Lower Interest Rates
Home equity loans carry lower interest rates than any other kind of loans. The only loans that may carry a slightly lower rate are home loans and certain subsidized student loans, business loans and home loans. Moreover, compared with cash advance loans, credit cards, pay day loans and other unsecured loans, the interest rate charged by home equity loans is drastically lower.
Though your credit score may modify the interest rate you will have to pay upon loan approval, given that home equity loans are secured loans, the interest rate will not vary that much. Moreover, home equity loans are the only way for bad credit applicants to get competitive rates. With unsecured loans bad credit applicants usually get nothing but abusive interest rates.
Equity Provides Longer Repayment Programs
Another benefit that home equity loans provide is the fact that these loans come with longer repayment programs. Thus, by extending the loan’s term, you can easily obtain low and affordable monthly payments so as to fit any budget. Compared to unsecured loans, these loans provide very flexible repayment programs.
While unsecured loans can generally be repaid in up to 48 months, home equity loans can last as much as 10 years and sometimes even more. This is particularly useful when you need to request high loan amounts because otherwise, the loan installments would be completely unaffordable.
Equity Provides Easy Approval
Finally, as regards to loan approval, since home equity loans reduce considerably the risk involved for the lender in the financial transaction, the approval process is fast and without hassles. There are not many credit requirements for loan approval. Moreover, there are some lenders that will approve home equity loans for people who have had recent bankruptcies or defaults.
By Expert Author: Melissa Kellett
Article Source: http://www.articlesphere.com/
If you are in desperately need of cash and you can not get approved for unsecured loans due to your bad credit history, you needn’t get depressed or despair. Home equity loans can provide you with all the financing you need at very reasonable rates and with loan installments you will be able to afford with ease.
Home equity loans have so advantageous terms that more and more people are requesting them everyday. It is such a simple finance solution that homeowners have nothing to worry about if something unexpected happened and they need extra cash to cope with it. They just need to request a home equity loan, sit down and relax.
Equity Provides Larger Loan Amounts
When requesting a home equity loan, you can be confident to get larger loan amounts than with unsecured loans. Provided that you have sufficient equity on your home, you will be able to get up to 85% or 90% financing on your home value. Only those with perfect credit can aspire to obtain 100% financing or even more.
If you have $40,000 of equity left on your home, you will not be able to get that total amount unless you have perfect credit. The amount of your home loan and the amount of you home equity loan added up usually can reach up to 85% of the home value. Thus, if you have an outstanding mortgage of $60,000, you will be able to get only $25,000 on your home equity loan.
Equity Provides Lower Interest Rates
Home equity loans carry lower interest rates than any other kind of loans. The only loans that may carry a slightly lower rate are home loans and certain subsidized student loans, business loans and home loans. Moreover, compared with cash advance loans, credit cards, pay day loans and other unsecured loans, the interest rate charged by home equity loans is drastically lower.
Though your credit score may modify the interest rate you will have to pay upon loan approval, given that home equity loans are secured loans, the interest rate will not vary that much. Moreover, home equity loans are the only way for bad credit applicants to get competitive rates. With unsecured loans bad credit applicants usually get nothing but abusive interest rates.
Equity Provides Longer Repayment Programs
Another benefit that home equity loans provide is the fact that these loans come with longer repayment programs. Thus, by extending the loan’s term, you can easily obtain low and affordable monthly payments so as to fit any budget. Compared to unsecured loans, these loans provide very flexible repayment programs.
While unsecured loans can generally be repaid in up to 48 months, home equity loans can last as much as 10 years and sometimes even more. This is particularly useful when you need to request high loan amounts because otherwise, the loan installments would be completely unaffordable.
Equity Provides Easy Approval
Finally, as regards to loan approval, since home equity loans reduce considerably the risk involved for the lender in the financial transaction, the approval process is fast and without hassles. There are not many credit requirements for loan approval. Moreover, there are some lenders that will approve home equity loans for people who have had recent bankruptcies or defaults.
By Expert Author: Melissa Kellett
Article Source: http://www.articlesphere.com/
Managing Your Credit
Managing Your Credit
Nearly every consumer will have at least one inaccurate item included on their credit report, and it is up to you, the consumer, to make sure your credit file is accurate, verifiable and complete. According to the Wall Street Journal, from 2004 to 2006, more than 2,500 banks, thrifts, credit unions and mortgage companies made a combined $1.5 trillion in high-interest-rate loans, and the Mortgage Bankers Association reported that every three months, approximately 167,000 new families enter into foreclosure in the United States.
To ensure an accurate credit report, we recommend that you check your report from at least one of the three Credit Bureaus – TransUnion, Experian, and Equifax – every six months. The tricky part about managing your credit is that the information provided to the three Credit Bureaus comes directly from your creditors, and you will rarely if ever be notified of the information provided. This requires you to check your report often to identify erroneous information early. Credit Bureaus take into account the date that inaccurate items were reported and usually respond more positively if they know that you manage your credit carefully and check your reports often.
With the recent rollout of a new federal law, you are now entitled to one free credit report from each of the three Credit Bureaus per year. You can receive your free credit report in one of three ways. To request your free report online, visit www.annualcreditreport.com, or to request by phone call (877) 322-8228, or you can complete the form on the back of the Annual Credit Report Request brochure, and mail it to: Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA, 30348-5281.
If you've been denied credit, insurance or employment because of your credit report, then you are entitled to a free copy of your report from the reporting agency. The company to which you applied must supply the Credit Bureau's name, address and telephone number, but you must act quickly as you have a total of 60 days after receiving the denial notice to request your free report.
After obtaining a copy of your credit report, review each account carefully checking for even the smallest details including spelling errors, outdated or incomplete information and inaccurate account histories. Every credit report is laid out slightly different, so find a company that provides a report that is easy for you to read and file. Next, you need to start a detailed log of all the potential problems in the report, and be sure to include creditor contact information and the nature of the item in dispute. Make a thorough list of the items in dispute and gather ALL supporting information to help build a case for your position. Be meticulous in your documentation. Proper documentation is the key to winning any successful credit dispute.
Visit www.idealfsi.com for more information on building and managing credit.
By Expert Author: Chad Sunyich
Article Source: http://www.articlesphere.com/
Nearly every consumer will have at least one inaccurate item included on their credit report, and it is up to you, the consumer, to make sure your credit file is accurate, verifiable and complete. According to the Wall Street Journal, from 2004 to 2006, more than 2,500 banks, thrifts, credit unions and mortgage companies made a combined $1.5 trillion in high-interest-rate loans, and the Mortgage Bankers Association reported that every three months, approximately 167,000 new families enter into foreclosure in the United States.
To ensure an accurate credit report, we recommend that you check your report from at least one of the three Credit Bureaus – TransUnion, Experian, and Equifax – every six months. The tricky part about managing your credit is that the information provided to the three Credit Bureaus comes directly from your creditors, and you will rarely if ever be notified of the information provided. This requires you to check your report often to identify erroneous information early. Credit Bureaus take into account the date that inaccurate items were reported and usually respond more positively if they know that you manage your credit carefully and check your reports often.
With the recent rollout of a new federal law, you are now entitled to one free credit report from each of the three Credit Bureaus per year. You can receive your free credit report in one of three ways. To request your free report online, visit www.annualcreditreport.com, or to request by phone call (877) 322-8228, or you can complete the form on the back of the Annual Credit Report Request brochure, and mail it to: Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA, 30348-5281.
If you've been denied credit, insurance or employment because of your credit report, then you are entitled to a free copy of your report from the reporting agency. The company to which you applied must supply the Credit Bureau's name, address and telephone number, but you must act quickly as you have a total of 60 days after receiving the denial notice to request your free report.
After obtaining a copy of your credit report, review each account carefully checking for even the smallest details including spelling errors, outdated or incomplete information and inaccurate account histories. Every credit report is laid out slightly different, so find a company that provides a report that is easy for you to read and file. Next, you need to start a detailed log of all the potential problems in the report, and be sure to include creditor contact information and the nature of the item in dispute. Make a thorough list of the items in dispute and gather ALL supporting information to help build a case for your position. Be meticulous in your documentation. Proper documentation is the key to winning any successful credit dispute.
Visit www.idealfsi.com for more information on building and managing credit.
By Expert Author: Chad Sunyich
Article Source: http://www.articlesphere.com/
Credit Report and Score
Credit Report and Score
This article focuses on the basic concept and pattern of US credit and other credit related issues like credit report, credit bureaus, credit score, and ways to improve the credit core.
Credit is the money you borrow from somebody. Whenever you borrow money you become the debtor and the person who is crediting you the money is the creditor. Whenever you get a credit from somebody, it automatically implies that you need to repay the amount to the person you borrowed from within a certain period of time and with certain rate of interest. When you start making payment on your credit, the details of your payment gets reflected on your credit report.
Credit Report:
Credit Report is a statement which shows the public records, inquiries and the personal and credit details of an individual. This report is prepared by each of the three Credit Reporting Agencies – Equifax, Transunion, and Experian.
* Personal details include the name, current and previous addresses, date of birth, employers – both current and previous, social security number and the telephone numbers of the individual.
* Credit details include the debt amount, the monthly repayment of the debts, and all other lines of credit including credit cards.
* Inquiries include all the new lines of credit for which a person have applied over the last two years and finally
* Public records include the bankruptcy, foreclosures, tax liens and judgments that are put against the person.
All the information on your credit report is taken into account while computing your credit score.
Credit Score (FICO score)
Credit score is a numerical three digit number generated on the basis of your credit report. Lenders usually use these scores to predict your potentiality as a borrower. This score was developed by Fair Isaac and Company, and so it is popularly known as the FICO score. The scale runs from 300 to 850 with higher score representing higher credit worthiness and hence a favorable interest rate for your loans. A score of 720 and above is considered the most favorable as it helps in getting loans at a very low interest rate.
FICO score is based on the credit information from the credit report. This credit information is divided into five categories which include the payment history, amounts owed, length of credit history, new credit and the types of credit used.
Ways to improve your credit score:Improved credit score is always desirable since it gives you advantage in getting loans at favorable rate. But to have a high credit score, all you need to have is a good payment history. For this it is always essential that you do not close any existing credit cards accounts if it already has a good payment history. Even if you have not used the card yet, try and start using the card to make monthly utility bill payments and then repay the debt on time. In this way you can start building up your credit history. Moreover try to avoid applying for too many lines of credit as there will be credit inquiries whenever you apply for a new credit which will get reflected in your credit report. More and more credit inquiries suggest that you are credit hungry which will have a negative impact to your credit report and hence reduce your credit score.
By Expert Author: Lucy Matthews
Article Source: http://www.articlesphere.com/
This article focuses on the basic concept and pattern of US credit and other credit related issues like credit report, credit bureaus, credit score, and ways to improve the credit core.
Credit is the money you borrow from somebody. Whenever you borrow money you become the debtor and the person who is crediting you the money is the creditor. Whenever you get a credit from somebody, it automatically implies that you need to repay the amount to the person you borrowed from within a certain period of time and with certain rate of interest. When you start making payment on your credit, the details of your payment gets reflected on your credit report.
Credit Report:
Credit Report is a statement which shows the public records, inquiries and the personal and credit details of an individual. This report is prepared by each of the three Credit Reporting Agencies – Equifax, Transunion, and Experian.
* Personal details include the name, current and previous addresses, date of birth, employers – both current and previous, social security number and the telephone numbers of the individual.
* Credit details include the debt amount, the monthly repayment of the debts, and all other lines of credit including credit cards.
* Inquiries include all the new lines of credit for which a person have applied over the last two years and finally
* Public records include the bankruptcy, foreclosures, tax liens and judgments that are put against the person.
All the information on your credit report is taken into account while computing your credit score.
Credit Score (FICO score)
Credit score is a numerical three digit number generated on the basis of your credit report. Lenders usually use these scores to predict your potentiality as a borrower. This score was developed by Fair Isaac and Company, and so it is popularly known as the FICO score. The scale runs from 300 to 850 with higher score representing higher credit worthiness and hence a favorable interest rate for your loans. A score of 720 and above is considered the most favorable as it helps in getting loans at a very low interest rate.
FICO score is based on the credit information from the credit report. This credit information is divided into five categories which include the payment history, amounts owed, length of credit history, new credit and the types of credit used.
Ways to improve your credit score:Improved credit score is always desirable since it gives you advantage in getting loans at favorable rate. But to have a high credit score, all you need to have is a good payment history. For this it is always essential that you do not close any existing credit cards accounts if it already has a good payment history. Even if you have not used the card yet, try and start using the card to make monthly utility bill payments and then repay the debt on time. In this way you can start building up your credit history. Moreover try to avoid applying for too many lines of credit as there will be credit inquiries whenever you apply for a new credit which will get reflected in your credit report. More and more credit inquiries suggest that you are credit hungry which will have a negative impact to your credit report and hence reduce your credit score.
By Expert Author: Lucy Matthews
Article Source: http://www.articlesphere.com/
Establishing Credit Helps to Build Financial Stability
Establishing Credit Helps to Build Financial Stability
One of the problems many people find when they first go to make a large purchase such as a car or house is that they do not have the necessary credit in order to receive financing. This does not mean that they have bad credit, but they have not proven that they are responsible with credit to any potential lenders.
There are several steps you can take to establish your credit. One of the first things you will want to do is to open a checking and savings account. You should be able to get these for no fees and low if any balance requirements, making them easy to use. Though it’s possible to live without such accounts, they are a positive way to build credit and prove that you have money in the bank. Another great reason to get a checking or savings account with a financial institution such as a bank or credit union is that they are a great place to apply for loans in the future since you have already established a relationship with them.
Another way to establish and build credit is to open a credit card. A store card is easier to obtain, but it also less usable and will have a smaller balance. A major credit card will carry a larger balance and be accepted at most locations. Regardless of what type of card you get, you will want to make sure to pay off the balance each month in order not to have to pay any fees or interest. If you are worried that you will be tempted to spend beyond your means, do not carry your card around with you but instead file it somewhere safe.
Once you have started these small steps to establishing credit, you will be better equipped and prepared to make larger purchases on credit. These steps you take today will help you reach your financial goals in the future.
By Expert Author: Ronnica Rothe
Article Source: http://www.articlesphere.com/
One of the problems many people find when they first go to make a large purchase such as a car or house is that they do not have the necessary credit in order to receive financing. This does not mean that they have bad credit, but they have not proven that they are responsible with credit to any potential lenders.
There are several steps you can take to establish your credit. One of the first things you will want to do is to open a checking and savings account. You should be able to get these for no fees and low if any balance requirements, making them easy to use. Though it’s possible to live without such accounts, they are a positive way to build credit and prove that you have money in the bank. Another great reason to get a checking or savings account with a financial institution such as a bank or credit union is that they are a great place to apply for loans in the future since you have already established a relationship with them.
Another way to establish and build credit is to open a credit card. A store card is easier to obtain, but it also less usable and will have a smaller balance. A major credit card will carry a larger balance and be accepted at most locations. Regardless of what type of card you get, you will want to make sure to pay off the balance each month in order not to have to pay any fees or interest. If you are worried that you will be tempted to spend beyond your means, do not carry your card around with you but instead file it somewhere safe.
Once you have started these small steps to establishing credit, you will be better equipped and prepared to make larger purchases on credit. These steps you take today will help you reach your financial goals in the future.
By Expert Author: Ronnica Rothe
Article Source: http://www.articlesphere.com/
Get Cash For Your Business Against Future Sells
Get Cash For Your Business Against Future Sells
It is now possible to obtain finance from your merchant account by using the future sells paid with credit cards. There are financial institutions offering loans and lines of credit against your upcoming sells that can provide you with all the funds you need for your business and can solve any cash flow problems that you may have.
This new financial product is helping more and more starting businesses finance the cash flow difficulties that small businesses experience when they are growing. Secured with the expected sells that you and the financial institution budget for the upcoming period, you get a line of credit or a loan for the amount you need to purchase new equipment, hire more personnel, pay for supplies, finance export and import transactions, etc.
Loans And Lines Of Credit
There are loans and lines of credit offered by this method. Loans come with fixed or variable rates and charge lower interest rates compared to unsecured loans and lines of credit. You get a fixed amount that you can repay in small installments so you can finance equipment purchases, temporary cash flow problems, pay for supplies to start up a new line of production, etc.
Lines of credit are revolving accounts that offer cash at a variable interest rate but only charge interests when you actually withdraw money from the account. In the meantime you have an open line of credit knowing that the cash is available whenever you need it. You can withdraw as much money as you need up to the pre-defined limit and repay it the way you want. Usually there are minimum payments consistent of the interests charged for the money borrowed and a small portion of the capital. Up to the credit limit you can withdraw and repay as many times as you need.
How Does It Work?
The money you request is guaranteed by the future sells of your company. Usually, credit card payment processors provide this service. Since they process your credit card sells, they can hold the funds or a portion of the funds you receive and destine them to repaying your debt. Thus, they are sure that as long as you are in business they can have some sort of control over repayment.
Of course, not all funds will be retained as you need cash to operate your company. However, the loan payments will be agreed as well as the minimum payments on your lines of credit and thus, each month, when the financial institution processes your client’s payments, you will get a deduction equal to the agreed amount from your overall sells. Thus, you will not even have to worry about repayment.
This is an excellent system that provides cheap financing for starting businesses as it reduces the risk involved in the transaction for the lender. This is due to the fact that the lender can exercise some control over your sells and know exactly what your repayment capacity is. Thus, with all this information, he can decide the most suitable loan program for your business.
By Expert Author: Amanda Hash
Article Source: http://www.articlesphere.com/
It is now possible to obtain finance from your merchant account by using the future sells paid with credit cards. There are financial institutions offering loans and lines of credit against your upcoming sells that can provide you with all the funds you need for your business and can solve any cash flow problems that you may have.
This new financial product is helping more and more starting businesses finance the cash flow difficulties that small businesses experience when they are growing. Secured with the expected sells that you and the financial institution budget for the upcoming period, you get a line of credit or a loan for the amount you need to purchase new equipment, hire more personnel, pay for supplies, finance export and import transactions, etc.
Loans And Lines Of Credit
There are loans and lines of credit offered by this method. Loans come with fixed or variable rates and charge lower interest rates compared to unsecured loans and lines of credit. You get a fixed amount that you can repay in small installments so you can finance equipment purchases, temporary cash flow problems, pay for supplies to start up a new line of production, etc.
Lines of credit are revolving accounts that offer cash at a variable interest rate but only charge interests when you actually withdraw money from the account. In the meantime you have an open line of credit knowing that the cash is available whenever you need it. You can withdraw as much money as you need up to the pre-defined limit and repay it the way you want. Usually there are minimum payments consistent of the interests charged for the money borrowed and a small portion of the capital. Up to the credit limit you can withdraw and repay as many times as you need.
How Does It Work?
The money you request is guaranteed by the future sells of your company. Usually, credit card payment processors provide this service. Since they process your credit card sells, they can hold the funds or a portion of the funds you receive and destine them to repaying your debt. Thus, they are sure that as long as you are in business they can have some sort of control over repayment.
Of course, not all funds will be retained as you need cash to operate your company. However, the loan payments will be agreed as well as the minimum payments on your lines of credit and thus, each month, when the financial institution processes your client’s payments, you will get a deduction equal to the agreed amount from your overall sells. Thus, you will not even have to worry about repayment.
This is an excellent system that provides cheap financing for starting businesses as it reduces the risk involved in the transaction for the lender. This is due to the fact that the lender can exercise some control over your sells and know exactly what your repayment capacity is. Thus, with all this information, he can decide the most suitable loan program for your business.
By Expert Author: Amanda Hash
Article Source: http://www.articlesphere.com/
Bad Credit Doesn’t Have To Be An Obstacle
Bad Credit Doesn’t Have To Be An Obstacle
Those with bad credit used to find it very hard to get finance with reasonable rates. But nowadays bad credit does not have to be an obstacle anymore in the road to cheap financing. Sometimes people with bad credit can get equal or similar terms on loans as people with a perfect credit score. You just need to know where to apply for a bad credit loan.
There are different types of bad credit loans. Each one has both advantages and drawbacks and knowing them thoroughly will aid you in getting the best deals out of your loan. So, prior to applying for a bad credit loan, analyze all your offers and compare loan terms knowing that each loan type has certain factors you will need to focus on.
The Collateral Factor
The presence of collateral greatly reduces the risk involved in any financial transaction and thus provides fewer requirements for approval along with better loan terms. This does not mean that credit or income requirements will be overlooked by the mere fact of applying for a secured bad credit loan instead of an unsecured loan. However, it is true that you can boost your chances by doing so.
Collateral reduces the risk for the lender because it provides a fair guarantee of the loan repayment. Ideally, in the event of default, the lender can claim his money by the legal action of repossession. The property being used as collateral is then sold and the money obtained from the sell is used to repay the loan plus any damages and the remaining can be claimed by the previous owner or by the other creditors.
Collateral provides then a good means to avoid the problems that bad credit implies and aids bad credit applicants to obtain financing at reasonable rates regardless of past delinquencies recorded into the borrower’s credit report. However, sometimes applicants can not offer collateral and other times it is just not enough.
Bad Credit Loans
Thus, there are bad credit loans based on equity that provide very advantageous terms and fairly good loan amounts. But these loans require collateral and unless you are a homeowner with enough equity available on your home, you will not be able to obtain a home equity loan for people with bad credit.
Fortunately there are bad credit unsecured loans available for people that lack collateral. These loans charge higher interest rates and offer lower loan amounts than secured loans. Yet, the main problem with unsecured bad credit loans is not that, but the fact that qualification is harder and thus, it is a lot easier to obtain a secured loan than an unsecured bad credit loan.
Bad credit unsecured loans are meant for those with bad credit caused by late payments or missed payments. But if your bad credit was originated by defaults or bankruptcy, chances are you will not be able to get approved unless you can provide a co-signer with a good credit score willing to take your place in case you can not afford the monthly payments. This will greatly reduce the risk and thus, ease the requirements for approval.
By Expert Author: Devora Witts
Article Source: http://www.articlesphere.com/
Those with bad credit used to find it very hard to get finance with reasonable rates. But nowadays bad credit does not have to be an obstacle anymore in the road to cheap financing. Sometimes people with bad credit can get equal or similar terms on loans as people with a perfect credit score. You just need to know where to apply for a bad credit loan.
There are different types of bad credit loans. Each one has both advantages and drawbacks and knowing them thoroughly will aid you in getting the best deals out of your loan. So, prior to applying for a bad credit loan, analyze all your offers and compare loan terms knowing that each loan type has certain factors you will need to focus on.
The Collateral Factor
The presence of collateral greatly reduces the risk involved in any financial transaction and thus provides fewer requirements for approval along with better loan terms. This does not mean that credit or income requirements will be overlooked by the mere fact of applying for a secured bad credit loan instead of an unsecured loan. However, it is true that you can boost your chances by doing so.
Collateral reduces the risk for the lender because it provides a fair guarantee of the loan repayment. Ideally, in the event of default, the lender can claim his money by the legal action of repossession. The property being used as collateral is then sold and the money obtained from the sell is used to repay the loan plus any damages and the remaining can be claimed by the previous owner or by the other creditors.
Collateral provides then a good means to avoid the problems that bad credit implies and aids bad credit applicants to obtain financing at reasonable rates regardless of past delinquencies recorded into the borrower’s credit report. However, sometimes applicants can not offer collateral and other times it is just not enough.
Bad Credit Loans
Thus, there are bad credit loans based on equity that provide very advantageous terms and fairly good loan amounts. But these loans require collateral and unless you are a homeowner with enough equity available on your home, you will not be able to obtain a home equity loan for people with bad credit.
Fortunately there are bad credit unsecured loans available for people that lack collateral. These loans charge higher interest rates and offer lower loan amounts than secured loans. Yet, the main problem with unsecured bad credit loans is not that, but the fact that qualification is harder and thus, it is a lot easier to obtain a secured loan than an unsecured bad credit loan.
Bad credit unsecured loans are meant for those with bad credit caused by late payments or missed payments. But if your bad credit was originated by defaults or bankruptcy, chances are you will not be able to get approved unless you can provide a co-signer with a good credit score willing to take your place in case you can not afford the monthly payments. This will greatly reduce the risk and thus, ease the requirements for approval.
By Expert Author: Devora Witts
Article Source: http://www.articlesphere.com/
Business Credit Article 2
Business Credit Article 2
5 Big Mistakes to Avoid When Building Business Credit
There are countless entrepreneurs today operating their businesses in a manner that puts them at great personal risk - risk of being hounded by creditors, poor financing offers on new cars, and even losing their homes. The risk stems from poor money and credit management.
Many business owners are completely unaware of the mistakes they are making, and those who are aware may not understand what they need to do to change. Fortunately, the answer to these problems is simple: avoid these 5 Big Mistakes and start paving the way toward building good business credit, with little or no personal risk.
Mistake #5: Putting Personal Assets at Risk
If you personally guarantee any credit extended to your business, you seriously risk your personal assets, such as your car, savings account, and your home. The most common way entrepreneurs fall into this trap is by setting up their businesses as a Sole Proprietorship. If you have not set up your business as a C-Corporation, S-Corporation or a LLC, then you most likely do not have a tax i.d. number; instead your business is tied to your social security number. This also means you do not have the legal means to separate your corporate credit from your personal credit. If you incorporate your business, you can protect yourself from personal liability.
Mistake #4: Not Paying Bills on Time...100% of the Time
Everyone who has some type of credit file also has a credit history attached to it, and having just one late payment on a line of credit can be held against you for years. This is vital information for entrepreneurs who are working toward building good business credit. Even if you have separated your personal and business credit lines, one late personal payment could affect your corporate credit, and your business’s growth.
Mistake #3: Not Building Corporate Credit the Right Way
Incorporating your business should be a first step toward separating your personal credit from your business credit, but it does not automatically qualify you for corporate credit. Your goal for building business credit is to secure lines of cash credit, not just vendor credit. You will need money to grow your business, and lots of it. The best way to start the process of building business credit is to maintain a physical office (not a PO Box!), obtain a local phone number and 411 listing, and secure a business license. After these steps have been taken, you can begin to build a credit score with business credit bureaus.
Mistake #2: Rushing the Process of Building Business Credit
Just as it took time to build your personal credit, so too does it take time to build good business credit. The goal for building credit is to get cash, but added to that goal is to get cash without a personal guarantee. The industry standard for building business credit and securing cash loans without personal guarantees is two to three years. Do not rush your ultimate goal.
Mistake #1: Using Personal Credit to Finance Your Business
The absolute biggest and most common mistake business owners make is using their personal lines of credit to finance their businesses. This includes paying business expenses with personal credit cards, “borrowing” money from personal savings and investment accounts, and securing personal loans to finance business expenses and expansions. This big mistake lowers your personal credit score because every lending inquiry into your credit history lowers your credit score; it reduces the amount of credit available for personal use because your debt-to-income ratio skyrockets. And should your business fail (as 95% do in the first five years, according to the Small Business Administration), you will be personally liable for all those “personal” loans. You do not have to risk your lifestyle for your livelihood.
By Expert Author: Trent Lee
Article Source: http://www.articlesphere.com/
5 Big Mistakes to Avoid When Building Business Credit
There are countless entrepreneurs today operating their businesses in a manner that puts them at great personal risk - risk of being hounded by creditors, poor financing offers on new cars, and even losing their homes. The risk stems from poor money and credit management.
Many business owners are completely unaware of the mistakes they are making, and those who are aware may not understand what they need to do to change. Fortunately, the answer to these problems is simple: avoid these 5 Big Mistakes and start paving the way toward building good business credit, with little or no personal risk.
Mistake #5: Putting Personal Assets at Risk
If you personally guarantee any credit extended to your business, you seriously risk your personal assets, such as your car, savings account, and your home. The most common way entrepreneurs fall into this trap is by setting up their businesses as a Sole Proprietorship. If you have not set up your business as a C-Corporation, S-Corporation or a LLC, then you most likely do not have a tax i.d. number; instead your business is tied to your social security number. This also means you do not have the legal means to separate your corporate credit from your personal credit. If you incorporate your business, you can protect yourself from personal liability.
Mistake #4: Not Paying Bills on Time...100% of the Time
Everyone who has some type of credit file also has a credit history attached to it, and having just one late payment on a line of credit can be held against you for years. This is vital information for entrepreneurs who are working toward building good business credit. Even if you have separated your personal and business credit lines, one late personal payment could affect your corporate credit, and your business’s growth.
Mistake #3: Not Building Corporate Credit the Right Way
Incorporating your business should be a first step toward separating your personal credit from your business credit, but it does not automatically qualify you for corporate credit. Your goal for building business credit is to secure lines of cash credit, not just vendor credit. You will need money to grow your business, and lots of it. The best way to start the process of building business credit is to maintain a physical office (not a PO Box!), obtain a local phone number and 411 listing, and secure a business license. After these steps have been taken, you can begin to build a credit score with business credit bureaus.
Mistake #2: Rushing the Process of Building Business Credit
Just as it took time to build your personal credit, so too does it take time to build good business credit. The goal for building credit is to get cash, but added to that goal is to get cash without a personal guarantee. The industry standard for building business credit and securing cash loans without personal guarantees is two to three years. Do not rush your ultimate goal.
Mistake #1: Using Personal Credit to Finance Your Business
The absolute biggest and most common mistake business owners make is using their personal lines of credit to finance their businesses. This includes paying business expenses with personal credit cards, “borrowing” money from personal savings and investment accounts, and securing personal loans to finance business expenses and expansions. This big mistake lowers your personal credit score because every lending inquiry into your credit history lowers your credit score; it reduces the amount of credit available for personal use because your debt-to-income ratio skyrockets. And should your business fail (as 95% do in the first five years, according to the Small Business Administration), you will be personally liable for all those “personal” loans. You do not have to risk your lifestyle for your livelihood.
By Expert Author: Trent Lee
Article Source: http://www.articlesphere.com/
Bad Credit So What?
Bad Credit So What?
Everything can be fixed. All problems have a solution and in many cases more than one. Bad credit is not the exception and can be improved dramatically, provided you take immediate action and get cracking to repair your credit. There is more than one way to repair it, as we shall see.
How Can We Repair Bad Credit?
There are two stages to bad credit repair. The first is to get rid of all the inaccurate, outdated and completely erroneous information. This is done by contacting the credit rating agencies and getting them to correct the mistakes. This is the part that means eliminating bad entries.
The Second Stage
This is the building stage, in which you inform all the missing data about favorable situations which were not taken into account. Give proof of what you are stating. Next, comes the build up of fresh good entries. This can only be done by taking several small loans and paying them back on time and if possible, before the due date.
You can use these to pay off small debts, or split a big debt into two and pay the parts with two successive loans. You would be killing two birds with one stone.
Now, You Are Clean
... or at least almost clean. If you still have debt but you are up to date with the payments, you can either pay them off with a smaller loan, or directly apply for a larger loan, directly aimed at investment, maybe a bargain with a car or land on which to build. If you already have a property you can use the equity on your home to invest.
Why Land?
Simply because it will be the best way to secure the loan, adding to your assets. Should you run into any problem, you will be able to sell the property you bought last, to save your home and you have not lost anything at all. Just a little time. On the other hand, if everything comes out as you have planned, you will have two great benefits.
The First
You will have repaired your credit and corrected bad spending habits, which will make you and your family feel safer, better and happier. The second benefit is that you will be learning to invest in a safe way, contributing to your overall progress. However, we recommend further reading if you wish to go into to estate investment.
Start small and learn to potentiate your loans, turning them into capital, not throwing them down the drain as debt payoff. It happened to you once. The best outcome should be, never again.
Bad Credit, So What?
The “So What” expression should not mean, “I do not care”. On the contrary, you do care, but you know now that your credit can be repaired and even taken as an important lesson learnt. Immediately after you have repaired your credit, take advantage of the momentum and with all your positive energy, give your economy an upward thrust. You could be the next millionaire.
By Expert Author: Amanda Hash
Article Source: http://www.articlesphere.com/
Everything can be fixed. All problems have a solution and in many cases more than one. Bad credit is not the exception and can be improved dramatically, provided you take immediate action and get cracking to repair your credit. There is more than one way to repair it, as we shall see.
How Can We Repair Bad Credit?
There are two stages to bad credit repair. The first is to get rid of all the inaccurate, outdated and completely erroneous information. This is done by contacting the credit rating agencies and getting them to correct the mistakes. This is the part that means eliminating bad entries.
The Second Stage
This is the building stage, in which you inform all the missing data about favorable situations which were not taken into account. Give proof of what you are stating. Next, comes the build up of fresh good entries. This can only be done by taking several small loans and paying them back on time and if possible, before the due date.
You can use these to pay off small debts, or split a big debt into two and pay the parts with two successive loans. You would be killing two birds with one stone.
Now, You Are Clean
... or at least almost clean. If you still have debt but you are up to date with the payments, you can either pay them off with a smaller loan, or directly apply for a larger loan, directly aimed at investment, maybe a bargain with a car or land on which to build. If you already have a property you can use the equity on your home to invest.
Why Land?
Simply because it will be the best way to secure the loan, adding to your assets. Should you run into any problem, you will be able to sell the property you bought last, to save your home and you have not lost anything at all. Just a little time. On the other hand, if everything comes out as you have planned, you will have two great benefits.
The First
You will have repaired your credit and corrected bad spending habits, which will make you and your family feel safer, better and happier. The second benefit is that you will be learning to invest in a safe way, contributing to your overall progress. However, we recommend further reading if you wish to go into to estate investment.
Start small and learn to potentiate your loans, turning them into capital, not throwing them down the drain as debt payoff. It happened to you once. The best outcome should be, never again.
Bad Credit, So What?
The “So What” expression should not mean, “I do not care”. On the contrary, you do care, but you know now that your credit can be repaired and even taken as an important lesson learnt. Immediately after you have repaired your credit, take advantage of the momentum and with all your positive energy, give your economy an upward thrust. You could be the next millionaire.
By Expert Author: Amanda Hash
Article Source: http://www.articlesphere.com/
Piggybacking and Repairing Your Credit
Piggybacking and Repairing Your Credit
The practice of piggybacking has been around for years, and many consumers have used it to boost their credit scores. In order for a consumer with bad credit to boost their score, a person with good credit would authorize the bad-credit individual on one or more of their credit lines which artificially boosted the lower credit score and making it appear that the person actually had several positive credit accounts.
Good Intentions of Piggybacking Credit
It may sound a little shady, but the intentions of piggybacking are often good such as a parent helping one of their children to begin establishing good credit or a spouse helping to boost their partner's score. However, a few years ago, several credit repair companies started taking advantage of this practice. For a fee, they would match people with bad credit up with people that had good credit and authorize them on one or more good accounts. The company charged a fee for this credit boosting service, with a percentage going to the party with the good credit and the firm pocketing the rest.
Does FICO Bar Piggybacking?
These abuses of the piggybacking method upset the Fair Isaac's Credit Organization (FICO) and lenders as well. After all, with artificially inflated credit scores, how could they accurately determine a person's credit worthiness and protect themselves from unnecessary financial risks?
As a result of these widespread abuses, FICO decided to bar the use of piggybacking when it revamped its credit scoring model for FICO 08, alleging that these practices basically amounted to fraud. Ultimately, this controversy resulted in a congressional hearing.
Making it Harder to 'Game' the Credit System
As a result of decisions made in a congressional hearing on piggybacking and credit repair, FICO and the other credit bureaus have developed a solution that still allowed for piggybacking, but with new considerations. "We worked very hard with the credit bureaus and lenders to find how important it was to how many people," says Mike Campbell, Chief Operations Officer for FICO. "Fortunately, we were able to come up with technology that makes it much harder to game the system."
Can Piggybacking Still be Used to Repair My Credit?
The simple answer is 'Yes', piggybacking can still be used as a method for credit repair. As a result of the FICO 08 revamp, it may be more difficult to exploit the system using piggybacking, but for now, it is still a valid and useful tool for improving your credit score.
By Expert Author: Anne Hammel
Article Source: http://www.articlesphere.com/
The practice of piggybacking has been around for years, and many consumers have used it to boost their credit scores. In order for a consumer with bad credit to boost their score, a person with good credit would authorize the bad-credit individual on one or more of their credit lines which artificially boosted the lower credit score and making it appear that the person actually had several positive credit accounts.
Good Intentions of Piggybacking Credit
It may sound a little shady, but the intentions of piggybacking are often good such as a parent helping one of their children to begin establishing good credit or a spouse helping to boost their partner's score. However, a few years ago, several credit repair companies started taking advantage of this practice. For a fee, they would match people with bad credit up with people that had good credit and authorize them on one or more good accounts. The company charged a fee for this credit boosting service, with a percentage going to the party with the good credit and the firm pocketing the rest.
Does FICO Bar Piggybacking?
These abuses of the piggybacking method upset the Fair Isaac's Credit Organization (FICO) and lenders as well. After all, with artificially inflated credit scores, how could they accurately determine a person's credit worthiness and protect themselves from unnecessary financial risks?
As a result of these widespread abuses, FICO decided to bar the use of piggybacking when it revamped its credit scoring model for FICO 08, alleging that these practices basically amounted to fraud. Ultimately, this controversy resulted in a congressional hearing.
Making it Harder to 'Game' the Credit System
As a result of decisions made in a congressional hearing on piggybacking and credit repair, FICO and the other credit bureaus have developed a solution that still allowed for piggybacking, but with new considerations. "We worked very hard with the credit bureaus and lenders to find how important it was to how many people," says Mike Campbell, Chief Operations Officer for FICO. "Fortunately, we were able to come up with technology that makes it much harder to game the system."
Can Piggybacking Still be Used to Repair My Credit?
The simple answer is 'Yes', piggybacking can still be used as a method for credit repair. As a result of the FICO 08 revamp, it may be more difficult to exploit the system using piggybacking, but for now, it is still a valid and useful tool for improving your credit score.
By Expert Author: Anne Hammel
Article Source: http://www.articlesphere.com/
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