Feeds:
Posts
Comments

Posts Tagged ‘fixing my credit’

Most people don’t give much thought to the importance of credit until they need it.  When they go to apply for a credit card they discover that their bad credit keeps them from getting a card, or a card at a decent rate.  Most people want to pay their bills, and remain in good credit standing.  Nobody wants to be seen as a deadbeat to the credit card companies, but because of a couple of tight financial situations in the past they cannot get approval for a credit card.  There is a way around this problem.

There are a few companies out there that understand your situation, and want to help you to obtain a better credit rating.  These companies offer secured credit cards.  A secured credit card is a card that you make a deposit to which determines your credit limit.  You can use your card just like any credit card, but your purchases are limited to your deposited amount, (similar to a debit card).  Before applying for a secured credit card you must make sure that the card reports to the major credit reporting agencies.  If they do not report then that card is nothing better than a glorified debit card.   In extremely simplified terms when a secured card sends reports to the major credit reporting agencies they are showing that you are paying off your debits, and you are less of a credit risk.

Here’s a brief example of how these cards really work.  On the surface it works just like a debit card.  Let’s say you made a $200 deposit to your secured credit card.  You then go to the store and make a $20 purchase.  Your account balance is almost immediately reduced by $20 to $180.  The key to these cards is when the credit card company goes to report your information to the major credit reporting agencies, (the better secured card companies will report monthly).  In simplified terms, the credit card company will tell the reporting agency that you made a $20 purchase on your credit card, and it was paid.  As far as the reporting agency is concerned you are making good on your charges.  This is a sign of a good borrower.  Even if you have had problems with credit in the past the reporting agency is seeing that you are now less of a default risk thus bumping up your credit score.  After time you become more appealing to other credit card companies and you will more readily be accepted for traditional credit cards.

Improving your credit is not a quick and easy task.  There are many other things that factor into your credit score, but this is one action that you can take on your own.  A secured credit card may not fix severely damaged credit, but for many people it’s a step in the right direction.  It will not make your credit score sky rocket into the upper 700’s either.  It will take some time, but it’s better than sitting back, passively hoping that things will get better.

*Before applying for any credit card be sure to read, and understand the ‘terms and conditions’ of the card.

Ask me about credit repair.

Talk to you soon,

Leona.

If you or someone you know is thinking of selling a home, or buying a home or investing in real estate contact me. I love referrals.

Leona@LeonaTurner.com

http://LeonaGreenlowTurner.kw.com

www.facebook.com/BayAreaRealEstateToday

 

 

 

Advertisements

Read Full Post »

In today’s world it is almost a necessity to have a credit card.  If you have bad credit your options can become limited in regards to a credit.  Many of the credit card companies will just deny the application.  So picking the right card to apply for is very important and you might need to take advantage of bad credit credit cards.

The first thing is to consider what your credit rating is.  The reason for this is to many credit card inquiries will decrease your credit score.  You do not want to have to many inquiries so you need to limit the number of applications you submit.  Choose one or two that are more likely to approve you if you have a bad credit rating.  If your credit rating is bad, more than likely your approval odds are very low for a low cost card.  So at this point you would want to research a few bad credit credit cards.  There are several companies that will deal with less than perfect credit and actually help improve your credit rating and establish a good credit history.  There are both secured and unsecured bad credit credit cards available today.

Things to look for when choosing a credit card:

There are a lot of companies out there that make claims that they are helping individuals receive credit cards but in reality they just use the opportunity to take advantage of your already bad situation.  This is the reason you need to compare various card issuers and their offers.  Be sure to read all the fine print for every offer your considering.  This includes information on the fees, participation fees, or any other startup costs plus your credit limit.  These fees can produce a balance on your credit card before you even receive it.  The truth of the matter is that no matter where you secure your credit card there will be extra fees involved if you have a tarnished credit history.  But if you carefully compare your options you can find the offer with the lowest fees and interest rates (APR).

You can also have those fees associated with a secured credit card.  This type of card requires a savings account to be opened and your balance would be what your credit limit is.  If you were to default on the payments you would lose the balance.

Ultimately if you have bad credit it is not impossible to get a credit card, it will be more expensive but it is a way to regain your credit worthiness.  If you are careful you can eventually apply for a regular credit card with competitive rates and credit limits.  It is also wise to try and deal with online companies where their primary business is credit cards.  They a lot of times are the ones with the better rates, lower fees, and a lot of times will not require a savings account.  Your credit limit will be normally in the $250.00-$300.00 range but that is enough to start repairing your credit score.  Used wisely it is more than enough.

Talk to you soon,

Leona.

If you or someone you know is thinking of selling a home, or buying a home or investing in real estate contact me. I love referrals.

Leona@LeonaTurner.com

http://LeonaGreenlowTurner.kw.com

www.facebook.com/BayAreaRealEstateToday

Read Full Post »