Open Journalism For All - News, Documentaries And Information Services

Your credit score accounts for the amount of interest you have to pay for a loan or a credit card. Increasing your score in just a few points will make a big difference in the interest rate you will pay for a purchase. If your credit score is high enough, you’ll have no problem qualifying for a lender’s best rates and terms on auto financing, home loans and small business loans. The following are a few tips about how you can protect and improve your credit rating.

1 - Order Your Credit Report.

Your credit score is based on your credit report, so you should begin by ordering your reports and reviewing each one for accuracy. You can get your reports from a service such as MyFico.com, or order from Equifax, Experian and Trans Union separately online or by phone.

2 - Check Your Credit Report Information for Inaccuracies.

Check the identifying information for name, social security number, birth date and incorrect address. Make certain that old negatives and paid-off debts are deleted. Check for accounts and delinquencies that are not yours, late payments, charge offs, lawsuits, judgments or paid tax liens older than seven years old. Also, paid liens or judgments that are listed as unpaid, duplicate collections, bankruptcies that are older than ten years and any negative information that is not yours.

3 - Always Pay Your Bills on Time.

Payment history makes up more than a third of the typical credit score. If you paid bills late in the past, you can improve your credit score by starting to pay your bills on time. Lenders are looking for any sign that you might default, and a late payment is a good indicator that you are in financial difficulty.

4 - Keep Credit Cards Balances Low.

Carrying smaller balances is the best way to increase your credit score. The score measures how much of your limit you use on each credit card or other line of credit, and how much of your combined credit limits you are using on all your cards. Within 60 days, paying down credit card balances can increase your credit score by as much as 20 points.

5 - Try Not to Open In-Store Credit Cards.

Although your first credit accounts can serve to build and improve your credit history, there comes a point when each subsequent credit application can reduce your score. New credit cards reduce the age of your credit history, and a department store credit card isn’t good evidence of credit worthiness. Every time you apply for a retailer’s credit card your credit store gets dinged.

6 - Be Conservative When Applying For Credit.

Having at least one credit card that’s more than 2 years old can help your score by 15 percent. Make sure that your credit report is checked only when necessary. Or, if you are shopping for a home, try to apply for loans within a two-week period. By keeping the loan process within a two-week period, all of the credit report lookups are seen as one single request.

7 - Don’t Close Credit Cards or Other Revolving Accounts.

Shutting down unused accounts that have outstanding balances without paying off the debt changes your “utilization ratio,” which is the amount of your total debt divided by your total available credit. It will reduce the gap between the credit you are using and the total credit available to you, and that can hurt your credit score.

Ever get that feeling that you’ve got a large piece of spinach stuck between your teeth? Or that your fly is unzipped and you’re totally exposed? You know the look you get when there’s something wrong and you can’t quite determine what it is?

That’s exactly how it was with me.

Imagine this. I am finally beginning to get my feet back on the ground and my head screwed on straight after filing bankruptcy. My confidence is just beginning to return as I take the first step toward financial responsibility and
rebuilding credit. I walked into our neighborhood bank, ready to open a new checking account - carrying the small percentage of my income that I have earmarked to begin a savings account.

After turning over the application to the “personal banker,” I sat down to wait, only to have her return with a look that made me glance down to see if I had a large scarlet letter sewn to my chest. Come to find out - I did!

Prior to bankruptcy, during that terrible time when I wrote checks just to appease creditors rather than my checkbook, my banks weren’t so pleased and closed my accounts. Now I was branded with a flaming “C” on my record.

“C” doesn’t stand for financially “crashed,” or even “cruddy credit” but for “ChexSystems.” It’s sort of like the ‘Big Brother’ in money matters…a company that constantly watches and tracks your banking behavior. If you’ve written several bad checks, or if you’ve had accounts closed for nonpayment, ChexSystems knows all and makes note of it, sharing that information with the financial world. The system not only looks at the bad check(s), but at the amount of time it took you to “make good” on the “bounce.”

I walked away that day, embarrassed and humiliated, desperately fighting back that doomed feeling I had conquered with the discharge of my previous debts.

A little research, and a few years later, and I can tell you absolutely, that you can overcome the “Scarlet C.”

First, know that before you attempt to open a bank account, you should check your rating. Go to www.chexhelp.com. The report costs $8.00, but is well worth it to know where you stand with ‘Big Brother.’

Then, if you find that you have a negative rating, understand that life WILL go on and that “this too shall pass.” If you have no more problems, your name will go off ChexSystems in five years.

Now, don’t despair. Just because your name is in the System for five years, doesn’t mean you won’t be able to open a bank account. But, before you run down to the nearest branch, call around to different banks and ask what their policy is with regard to opening accounts for someone on ChexSystems. Some banks will let you open an account provided that all debts have been paid. Other institutions will not allow any accounts whatsoever until the five years have elapsed, and some places will open accounts if the problem indicated on “Chex” was more than two years ago.

Maybe you’re less naive than I was. I had mistakenly assumed that with the discharge of my previous debts, and my new awareness of the importance of carefully planned financial decisions, that all my problems were in the past. But I didn’t know about ChexSystems or that even though debts are discharged - my negative banking record wasn’t erased. (There is no law requiring the removal of accurate, factual information from my name in the system.)

If you’d like to dispute the information on your ChexSystems account you can. You can file a written statement which will be added to your file. Keep in mind, however, that ChexSystems simply passes on information to the bank. They don’t decide whether or not you can have an account. That’s totally up to the bank.

Of course, you can overcome a bad history by careful management and planning, and eventually that bank employee won’t have that “oh-my-goodness-you-have-the-plague” look when she talks to you. Instead, she’ll be smiling, welcoming, and pleased to have you walk in the door when rebuilding credit. That “C” once emblazoned on your chest will now only remind her of “Customer.”

Subscribe to credit is keys phenomenal 7 lesson series that is sure to get you on the fast track to credit restoration, rebuilding credit. Simply click the link and begin your life after bankruptcy.

If you’ve just been turned down for credit, you must be disappointed. But, if you really want a home, don’t give up! There are other ways to skin a cat.

First, think like a finance company. Their job is one of the toughest around. First they want your business. They can’t earn interest unless they make loans. However, due to some “internal guidelines”’ they have to turn away business.

Imagine, if you went to a grocery store, picked out your groceries, and brought your cart full of groceries up to the check out stand. The cashier at the check out stand looks at your wallet full of money, and told you that you did not qualify to buy their groceries. You might think you were in Russia!!

Now, here you are, at the financial check out stand, telling the bank that you are ready, willing and able to pay for your home, and they’ve told you “No”

Bankers are Collectors, Not Risk Takers

Banks are not around to take chances. Stunt men take chances. Bankers collect interest.

Let’s think like the bank some more. The banks and finance companies want to make good, profitable, and “easy to collect” loans. They have historical records of who pays and who does not. That’s why, if your application looks like the average person that did not or could not pay, you are less likely to get a loan.

To See What Your Lender Saw,
Look at What Banks “Look For”

When Determining a Credit approval

Banks look for generally three things when determining your credit: Character, Credit and Collateral. But they use their own definition for these terms.

Character: The banks want you to have a steady, decent paying, job. They want you to be able to handle your bills with the income you make. They want you to have a telephone. Most people who in our society have and use a telephone regularly. Getting your telephone cut off is an indication of losing a job, or that your bills are too high. A checking account is an indication that you know how to handle your money. These are “normal” things and a matter of “ratios.”

Credit: Do you pay and have you always paid your bills on time? That includes the power company, your student loans, the doctor, and the encyclopedias that you decided too late you didn’t like. Paying even that encyclopedia guy is an indication that you are willing to stick to your part of the bargain, even if you realized later that you didn’t get the best deal.

Collateral: Even if you don’t have some of those things listed above, or are a little weak in one of the areas, collateral can pull you through. What is collateral? Collateral is something of value that you are promising or pledging against the loan. The more you are willing to put into the deal, whether it’s more down payment or maybe your property, the better your loan will look.

Now that you know what the banks look for, let’s figure out a way to get it. You will note that each method described for you will fall under one of the three headings we talked about.

Three ways to improve the “Character” portion of your loan:

1. Keep your jobs for a longer time. Or, apply and get a new home before you quit the job you don’t like. Even if you don’t like your job, and might want to quit, apply for the loan before you tell your boss. The banks are looking for people who will be working steadily.

2. If your debts are too high, stop adding to your debts while you pay off some of your bills. Cut up your department store cards if you can’t stop using them.

You might consider a debt consolidation loan. Most department stores and many credit card companies charge up to 20% interest on their cards. That’s why department store cards are so easy to get. They charge so much to make up for those who do not pay.

Go to your bank or credit union and ask for a consolidation loan. You might end up paying a less expensive interest rate over a longer term, and bring down the total monthly bill. This will leave more room in your budget every month an might free up some more money allowed for your new home.

3. Get a checking and savings account. Maintain a phone line. Keep your present address for a longer time.

Five ways to improve your credit:

4. Co-signer. A co-signer is a person, usually a relative that has the income and credit to stand behind you and put their reputation on the line for you. A cosigner can be used for someone who has limited credit experience or limited job time. A co-signer cannot be usually be used for a person who has poor credit. If you have poor credit you will need a person who will do a “buy for.”

5. Buy for. A buy for is for someone who might have those credit dings. The person with good credit will buy a home for someone with bad credit or no credit. One of the finance companies that we use specializes in this type of loan. If you want more information on this option, ask for our brochure on “Instant Credit”

6. Secured Loan. Go to the bank with a thousand dollars or more. Deposit the money in a one year CD. Then, at the same time, ask the loan officer for a one thousand dollar loan. Use your one thousand dollar CD as collateral. Tell the banker you want to have the loan to establish credit. He’ll usually give you the loan, because he knows he will get paid back. With the loan money, repeat the process at least at one other bank. That way, you will have credit at two banks. When the year is up, cash out your CD and pay off the loan at each bank, reversing the process

7. Credit repair. If there’s something on the credit bureau that you don’t agree with, you have the right to dispute the thing that you don’t agree with. If this is your problem, you can dispute it yourself, or have someone else do it for you. We have some tools for you to do it yourself, or we can give you a name of someone who can help. Ask your sales counselor about this if you need help

8. Choice of last resort-Time. If your credit rating isn’t what you want you may just have to wait until the old credit goes off the books. The banks look for a credit history, and that just takes time.

You may have to wait until the new credit goes on the books. Keep trying. Apply again in six months to a year. If a new home is in your dreams, there is a way to own a home of your own. Other people that were once in your circumstances are now homeowners!

Three Ways to improve your collateral:
9. More down payment. Even if your credit is less than perfect, the more money you put down, the less chance the bank will lose money if you don’t pay. If you make the loan less risky to the
bank, the bank is more willing to do the deal. We know what they want…ask us!

10. Smaller, less expensive home. Keep the same down payment that you have for your larger home. But use it for a smaller home. You will have smaller payments and a larger percentage of down payment. We can tell you how much of a home they will approve–ask us!

11. Use the land you own to add to the down payment. If you put the land that you own as collateral toward the loan, the land is listed by the bank as if it were a cash down payment. So, if your land is worth 15,000, and your the home you want is worth 150,000, the land will be looked at as an extra 10% down (10% of 150,000 is 15,000).
Now, Take Control!

First find out why you were turned down. Ask your bank.

Then, get to work. Use one or more of the ten secret methods listed above that will work best for you. Used properly, these secret methods have been proven to be successful in obtaining credit for thousands of people-just like you!

PS Use one or more these little known methods to own your new home. We can’t guarantee success. Follow these steps and you’ll be amazed at how easy home ownership can be.

Paul Roth is a Custom Home Builder in Southern Illinois, and part time teacher at a local junion college. He enjoys putting together the creative deal He has been in the construction, housing and real estate businss since 1984. his business website is http://www.emidwesthomes.com

Credit Report and Credit Score is used to check credit worthiness of a person. Credit score is based on the data provided by the credit report that indicates payment history, accounts, etc. Today many lenders and retailers take the help of credit report and credit score to lend credit. Credit report and credit score helps the bank lenders to judge the credit worthiness of a person at the time of allotting him credit.

Person with bad credit report and score find it difficult to raise the credit whereas the person with good credit score and report does not face any financial stake. The credit report and score provides a true picture of a person’s financial position. But it is the initiative of individual or financial institution to ask for it. This credit report and score are provided by credit bureau within few days of your request.

It is advisable that every person must understand his/her credit report. Initially the law prohibited for its disclosure but later on it was made available on request. It is vital that one should check his/her credit score and report any errors found. Remember a small error in your credit score can harm your credit report in a big way. Generally credit score ranges from 300-750 but many people have their credit score within 600-750. In business terms, score above 700 is regarded as excellent credit score.

Why Check Free Credit Report and Score?
Checking Credit Card does not harm your credit score. Checking removes the bad remark in your credit report and similarly in the credit score. It indicates your financial position in the business. Regular updating of credit report also helps to rectify any major financial error. If you find any error or mistake in your credit report assure that you rectify it immediately.

How can you get your Credit Score?
It is true that credit score is totally based on the content in credit report. As the content in credit report varies there is variation in your credit score. It is possible to view your credit report online just by requesting for it. The credit report and credit score that you get through these online services do not cost much.

Isabella Rodrigues writes for credit-free-score.net,
offering the latest information on credit score, visit them today for more infromation
on credit score..

Visit today: www.credit-free-score.net

This includes general information with a shipping address usually. This follows with the consumer entering payment information either into a form secured by a protocol or into an application, such as Internet Explorer or Netscape Navigator. With the secured form, the payment information is protected by Secure Sockets Layer as it is sent to the merchant.
Using the payment software incorporated in the Web server, the merchant sends the encrypted transaction to the acquiring processor for authorization. The authorization is a request to hold funds for purchase. The acquiring processor either authorizes a certain amount of money or declines the transaction. An authorization reduces the available credit limit but does not actually put a charge on the customer’s bill or move money to the merchant. If the transaction is authorized, a “capture” is the next step. The capture takes the information from the successful authorization and charges the authorized amount of money to the consumer’s credit card merchant service. In line with bank card association rules, the merchant is not allowed to capture transactions until the ordered goods can be shipped, so there may be a time lag between the authorization and the capture .If the consumer cancels the order before it is captured, a “void” is generated; if the consumer returns goods after the transaction has been captured, a “credit” is generated.

The final step is to “settle” the transaction between the merchant and the acquiring processor. Captures and credits usually accumulate into a “batch” and are settled as a group. When a batch is submitted, the merchant’s payment-enabled Web server connects with the acquiring processor to finalize the transactions and transfe the cash to merchant bank account

For more information on credit card processing,please visit http://www.paynetsystems.com

Some credit cards offer a cash advance option. But how good a deal is this?

Not very. In fact, it can be downright expensive.

Why?

Because every time you use your credit card to withdraw case, more fees kick in:

* Cash advances can carry an upfront fee of 2 percent to 4 percent of the amount advanced.

* The advances have a higher interest rate than regular card charges.

* Interest charges begin to mount as soon as the money comes out of the ATM.

* Many issuers also require you to pay down the balances for purchases before you pay down the higher-interest cash advance balance.

Here’s an example of how these fees kick in:

Assume you bought a television for $500 on your credit card and then took out $50 in cash. Even though you pay the $50 back the next day, you still lose your interest-free period because the credit provider deems you pay the cash back last.

As a result you will still owe the $50, but you will now only owe $450 on the $500 worth of purchases.

You’ll continue to forfeit your interest-free period up until you have completely paid back the full $550. Any future purchases will still be ahead of the $50 in the payback line.

The lesson is simple: Avoid using your credit card to withdraw cash wherever possible. You’ll save money as a result!
Shop around the amount of Credit Card offers is now staggering. If you are prepared to shop around your next Credit Card could save you money.

Keith Davies of http://www.searchforcredit.co.uk is always on the look out to save people money. Loans, Credit Cards, Mortgages we have all the latest deals.

For all the advantages that you are offered by using prepaid credit cards, there are some disadvantages you need to be aware of. In this article I will go over these, and this should help you make better decisions when using these cards.

When using prepaid credit cards online, it is important to be aware of where you are shopping. Some sites will scam you, and you may find yourself paying for products or services which you never receive. Shopping online with a prepaid credit card can put you at risk for these types of scams.

When you go out shopping, it is important to check the balance of your card to make sure you have enough to get what you’re buying. You don’t want to stand in a long line waiting to buy something just to get to the cashier and realize you don’t have enough money.

This will frustrate and humiliate you. One of the disadvantages to using prepaid credit cards is unlike cash, there is no way for you to look in your wallet to figure out how much you have to spend. It is important go online and check your balance and transactions.

Another disadvantage to using prepaid credit cardsis that many places and shops do not accept them. This is especially true when traveling to other countries, which may have cash based societies. Small restaurants and shops in foreign countries may only accept the local currency.

Because of this, it is important to carry around small amounts of cash at all times when traveling. Another problem with prepaid credit cards is the potential for abuse by merchants. Many people have complained that when they make a purchase at a restaurant or store, the merchant takes out more money than they’re supposed to.

This doesn’t happen with cash, because when you pay with cash merchants aren’t allowed to have access to your account. The best way to avoid this is to only shop at reputable locations, and check your balance immediately after making transactions. Sometimes mistakes do happen, and it is important for you to catch them as soon as possible.

The last issue that could be a problem when using a prepaid credit card is not being able to access your own money. Some people are frustrated to find that they are not able to withdraw their money from ATM machines when they need it the most. While this doesn’t happen often, it is another good reason to carry some cash at all times.

The writer of this article is the webmaster of Prepaid Credit Cards Website. On this website you can find information about prepaid credit cards and a list of vendors that sell these credit crads over the internet.

British Airways Credit Card, issued by Chase, is the perfect card for those who fly on British Airways. There are many perks for those who use this card responsibly.

The annual fee of the British Airways Credit Card is $75. This annual fee is average for this kind of rewards credit card.

There is a 4.9% interest offer on all balance transfers and purchases for the first five months. The variable APR of 16.99% for purchases is a bit high for such a card. The variable APR on cash advances jumps slightly to 22.74%. The finance charges are applied to any purchases that are not paid for within the first 20 days, and there are charges for other services like cash advances and balance transfers. Late payment fees are assessed when they occur.

The bonus program associated with this card offers two travel miles when you travel on British Airways. One travel mile is awarded for everyday purchases. You start out with 15,000 bonus miles when you make your first purchase on the card. A nice feature is that you can earn as many points a year as you like and the miles you earn do not expire so long as your frequent flyer account has some activity every three years. You can use your bonus miles on British Airways or any of their partner airlines.

Other perks of the British Airways Credit Card are up to $1,000,000 in travel accident insurance, auto rental insurance, and insurance for lost luggage. There is also no pre-set spending limit, with purchases being authorized base on spending and payment history. With the card you can also receive a free companion ticket on British Airways for every FIRST, Club World or World Traveler Plus round-trip ticket at the regular price.

The British Airways Visa Signature Card is a good choice of cards when you travel frequently and use British Airways.

Everyone needs credit these days and credit cards have become a part and parcel of everyone’s life. But man has woven a credit card debt trap around itself. To avoid this debt trap low rate credit cards have been introduced. A low rate credit card is usually for those who hold a good credit history and have considerable repayment capacity. For example the student credit card is generally not a low rate credit card. The travel cards issued by some of the reputed merchants like British Airways, NorthWest Airlines etc are cards that attract high interest charges.

If someone carries a large balance on a high interest credit card then transferring the balance to a low rate credit card can save some honest money. Low rate credit card ensures paying off large outstanding on numerous cards at an attractive low interest rates. Some cards offer 0% APR on balance transfer and cash advances from six months to twelve months.

The rates involved in calculating the finance charges are usually the interest rates. Other charges include the late payment fee, over limit fee, rates applicable after the introductory period, etc. For those who carry a large balance on their cards opting for a low rate credit card can save thousands of dollars. A low rate credit card also offers several other benefits like 5% cash back reward on select purchases from outlets like grocery stores, supermarkets or gas stations and 1% cash back reward on purchases from other outlets.

Citi® Diamond Preferred® Rewards Card, Citi® Dividend Platinum Select® Card, Chase Flexible Rewards® Platinum Visa® Card, Citi® Premier Pass Card, Chase Cash Plus® Rewards Visa, Free Cash Rewards Platinum Visa® Card, etc are some of the credit cards that fall in a low rate credit card category.

A low rate credit card does not have any annual fee which is another form of cutting overhead costs on any credit card debt. Many of these cards offer up to 1000 bonus points on first purchase. There after one bonus point is awarded to the card holder for every one dollar spent. Some of these cards also offer checks or gift certificates from participating merchants when specified amount of bonus points are accumulated. For example Free Cash Reward Platinum Visa Card offers a $25 check or an equivalent gift certificate from many leading national merchants after accumulation of 2500 points.

Usually it is wise to pay off a high interest rate card with a low rate credit card. But one should watch out for the traps of high transfer fees and short promotional low-term rates. One should read the fine print. Usually the fine print on any low rate credit card states that if the card holder default the payment or makes any consecutive late payments then the existing interest rates dissolve and the usual high interest rates prevalent in the market are applicable. Finally, the card holder should avoid maxing out a new low rate credit card, as this can cause the card holder’s credit score to dip.

Peter Sissons, Retired Bank Manager and Unsecured Credit Cards advisor - focusing on Bad Credit Credit Cards and Business Credit Cards

A credit card is an agreement between the issuer (a financial organization or a bank) and the cardholder (you). The agreement becomes a binding contract when you sign it, indicating to the credit company or the issuer that you will pay them in future for the credit lent to you. The issuer or the bank lends you the money that you need and it expects you, the cardholder, to pay back the money within a stipulated period of time.

Credit cards are being widely used in the US and across the world as a convenient financial mode to make purchases and payments. It is quite comfortable to carry a credit card rather than carry wads of cash. It is easy for people to manage their expenses with a credit card. Suppose you need to book a flight ticket urgently, you can book it with a credit card. You can use the cash that you have presently to take care of expenses you need when you reach the destination. You can always pay the credit company later. As a card holder, you can get the right to avail of consumer protection under federal law. You can return an item that is not upto the satisfactory standards, damaged or delivered late. Your credit company comes to your rescue and sets up a dispute with the trader or merchant and gives you credit till the case is pending. If you lose the dispute, the credit applied to your account can be reversed too.

You have to be atleast 18 years of age to apply for a credit card and also have a regular source of income. The credit bureau runs a check through your credit profile to ascertain if you have any outstanding loans or bills on your account. If you already have a credit card to your name or are applying for a fresh one, your credit history makes the credit card issuer as to know how much credit can be lent to you. If your credit history is not good, then you may get a credit card with a high interest rate. Lenders however, perceive you to be a low credit risk if you live in a particular residence or are in one profession for atleast two years.

The prospective cardholder should look for low interest rates on the credit card. When shopping for the credit card, he should also look for annual fees. There are some issuers who charge annual fees, while there are others that do not. Many credit card issues aspire to offer the credit card with a zero or a lesser promotional rate of interest. Till the promotional period lasts, the credit card holder does not have to pay anything as interest or pay negligible rate of interest on the outstanding balances.

If you are prompt on your payments and do not go over the limit, you can even call the credit card company and bargain for a lesser interest rate. Most credit card issuers oblige because they want to retain you as their valued customer. You can even have a late fee waived or credit given to you as a good will gesture if you have been incorrectly charged. Use your credit card judiciously. Experts say that your credit card payments should not exceed 15 percent of your takeaway home salary package. Also discard the cards that you do not use. It is not good to have too many unused credit cards because it can affect your credit rating. The cardholder has to contact the credit-reporting bureau and ask it to remove the discarded cards from your report. It should be mentioned in your credit file that the cancellation and closure of the card was initiated by you and not by the issuer or the credit card company.

Daniel Cohen recommends Find Credit Cards for comparing different Advanta business credit cards.