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October 31, 2018, 8:52 am

5 Ways Bad Credit Can Be Repaired

by: The Financial Blogger    Category: Credit Rating & Credit Bureau,Personal Finance

Having a bad credit score greatly limits your borrowing abilities. Around a third of Americans have a credit score that is below 601, the number that determines whether or not you have bad or fair credit. With a below average credit score, it’s much harder to get approved for a loan or credit card with favorable terms. Consumers with a low credit score or more likely to face lower approvals along with lower borrowing limits and higher interest rates.

While bad credit is a hard problem to overcome, it’s not impossible. Continue reading to learn 5 ways that you can repair your bad credit and improve your chances of more favorable borrowing in the future.

1. Fix Credit Report Errors

Mistakes happen and on your credit report, a mistake can be quite costly. The first step in repairing your bad credit is to look at your credit report. If you see any issues, such as a credit card you didn’t open or a loan you paid off months ago, you’ll want to start the dispute process. First write a dispute letter and send it via certified mail or online. Typically you’ll hear back from the credit bureau within 30 days of receiving the dispute.

When disputing a problem on your credit report:

  • You’ll have to dispute each mistake with all credit bureaus
  • Dispute each account separately
  • Consider hiring a professional service

Fixing your credit report is unlikely to result in a huge 200 point jump, but removing errors is an important first step in repairing your credit.

2. Pay Off Debt

Debt-to-income ratio is a huge factor when lenders review a credit or loan application. Having high debt-to-income ratio also impacts your credit score. One of the best things you can do as a consumer to improve bad credit is to pay down debt. The most effective method is to pay off your highest-interest rate debt first. As you pay off debt, you can put more money towards other loans and credit cards.

Even if you’re applying for one of the best credit cards for bad credit, lenders still have thresholds that borrowers must meet. By paying off debt, you can give your credit score a boost.

3. Always Pay On Time

A late payment can have a severe impact on your credit score. In fact, paying on time makes up about 35% of your credit rating. When you pay a lender late, they not only charge you a late payment fee, they may also report the tardy payment to the credit bureaus. Lenders typically report a late payment once it is 30 or 60 days late. This mark stays on your credit report for seven years and can impact future borrowing.

Thankfully with today’s technology, it’s much easier to manage multiple due dates. Most lenders offer the ability to set up automatic payments each month. Instead of having to remember when to pay each of your bills, you can use automatic payments that are withdrawn from your account on a set day each month. This makes paying your bills effortless and all but eliminates the risk of a late payment.

4. Pay More Than the Minimum

Looking at your credit card or loan statement, it’s tempting to pay just the minimum balance due, especially when the payment is only $15 or $25. This low payment is especially helpful if you’re facing financial hardship.

The problem with paying just the minimum is that it will take months, if not years, to pay off the total balance due. Paying just the minimum also means that you’re paying more towards interest. Depending on the lender, you may find that paying the minimum balance due results in an increased balance each month.

The smarter option is to pay as large of a payment that you can afford. Putting more money each month means that more money is going towards the principal balance, allowing you to pay off debt quicker than you imagined. As you pay off debt, you can put even more money towards other debt, such as a credit card or student loan.

5. Avoid Further Borrowing Applications

Borrowing can be quite tempting at times. Maybe you’re interested in a store credit card that offers a discount on purchases or you want to purchase a new car which means an auto loan. But, more often than not, it’s best to avoid unplanned borrowing.

Applying for loans or credit cards too frequently will impact your credit score. As a rule of thumb, you want to wait at least six months between applications. While credit inquiries only make up 10% of your credit score, applying too often does impact whether or not a lender approves your application.

Conclusion

By knowing how to repair your bad credit, you can improve your chances of getting approved for a loan or credit card in the future. Though your credit won’t repair itself overnight, the sooner you get started on the process, the better.

If you have any helpful tips or advice for repairing bad credit, share your experience in the comments below.

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February 1, 2017, 10:46 am

Take Advantage of Credit Card Reward Programs

by: The Financial Blogger    Category: Credit Rating & Credit Bureau,Personal Finance

Credit card reward programs are not only convenient, but also allow you to earn some major bonuses like travel, merchandise, and even free cash. If you learn to be smart with your cards and take advantage of the many reward programs available, you can be looking at a big payoff.

Figuring out how to use credit card reward programs can be confusing, so it’s worth your while to check out the different types of reward programs and how you can benefit from them. Look through these tips on how you can profit from your credit card rewards.

  1. Match Your Credit Card to Your Spending Style

There are all sorts of rewards programs out there that allow you to accrue points towards merchandise, gift cards, travel miles, points, and even cold hard cash. By aligning your your reward program with your interests and goals, you will get the most out of your credit card.

If you like to travel, you need to be using an airline miles reward card. If you regularly charge things like gas and groceries, look for a credit card that offers cash back for everyday purchases. Be careful and don’t pick a rewards program that you aren’t likely to use. You spend money everyday, so why not get a little something back every time you make a purchase.

  1. Use Multiple Cards

If you want to get really fancy and optimize all sorts of rewards programs, you should use multiple credit cards for different purchases. Some cards are better suited for certain expenditures, such as the Chase Sapphire card for home insurance payments or the Express Blue Cash card for groceries. The end goal is to maximize the potential rewards with every purchase made.

Many money experts will tell you that having lots of credit cards can be problematic. The real problem isn’t the credit cards; it’s the spender who can’t pay off their balances in full each month resulting in fees and interest charges. I recommend this multiple credit card strategy only if you are a responsible money manager and consistently pay off your balances.

  1. When in Doubt, Choose Cash Back

Cash back rewards give you money to use for whatever you want. Obviously, this is a great option for everyone—who doesn’t like cash back? In fact, cash back rewards are nearly three times more popular than airline rewards or hotel rewards programs, according to CreditCards.com.

The beauty of this option is that you can apply your rewarded cash to anything, including your outstanding balance. So if you can’t decide what credit card reward program to sign up for, start out with a cash back reward card. You really can’t go wrong with getting cash for spending cash.

  1. Read the Fine Print

Make sure you read the fine print when signing up for a rewards card, otherwise you may end up costing yourself money. You’ll want to look for fees, annual percentage rate, and promotional rate terms. If you don’t understand the terms to which you are agreeing, you could be in for a nasty surprise when the promotional period ends.

Also, credit card companies are notorious for changing these terms. They will notify you, but chances are you won’t see the tiny notification they provide in the dense snail mail notice. Keep your eyes open for any notices from your issuer to make sure your reward program does not make any detrimental changes to your rewards program.

Reward points can expire, so make sure you read through the fine print to know that expiration date. Typically, expiration is 12 to 18 months, but it’s always a good idea to know for sure in order to fully profit from the program.

If you learn to manage responsibly and match your credit card to your spending style, you will benefit greatly from the rewards program.

 

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September 22, 2016, 3:56 pm

ARE YOU CONSIDERING CREDIT REPAIR SERVICES: CREDITREPAIR.COM REVIEWS

by: The Financial Blogger    Category: Credit Rating & Credit Bureau

Credit rules the global economy. This means you must have credit in good standing with lenders and credit card companies. Otherwise, you have to pay exorbitant interest rates on loans and lines of credit. Even worse, you can repeatedly receive denials from lenders and creditors because your credit score falls below the lending threshold.

However, don’t wring your hands if you possess a low credit score. You have the option to work out of the financial abyss yourself or enlist the help of a credit repair service to put you back on sound financial footing.

Do It Yourself Credit Repair

On the Federal Trade Commission (FTC) website, one sentence summarizes the plight of those that require credit repair services: “The fact is there’s no quick fix for creditworthiness.” Credit repair takes time and more important for do it yourselfers, it takes considerable discipline.

Tips for Repairing Your Credit

You have to first notice your credit heading south long before you take action to repair it. If you expect to miss a credit card payment or a payment on a car loan, contact the lender(s) and explain your problem. Most creditors set up a plan to get your credit back on track. Try to send as much money as you can afford and once again, contact the lenders(s) to inform them of the less than minimum monthly payment amount.

Here are some credit repair tips to help you climb out of a financial hole:

  • Maintain low credit card balances (30% or less of available credit)
  • Pay every credit bill before the due date
  • Wipe low balance credit cards clean to reduce the number of cards you own that have balances
  • Automatic withdrawals from bank accounts prevent late credit payments
  • Never move debt around to prolong credit repair
  • Stop applying for loans and credit cards

These tips help you repair If you need cash quickly for a bill you can get a car title loan. Titlemax offers loans that you can apply online and you can get cash in less than a half hour. Moreover, the tips also prevent you from ever requiring credit repair services.

When You’re Sinking in Debt

Sometimes, all of the self-discipline and carefully designed do it yourself credit repair strategies fall short of your credit repair goals. Whenever this happens, you should consider working with a credit repair service, such as creditrepair.com. You must meticulously vet credit repair companies and never do business with companies that have a track record of promising services that never fulfill the promises.

Credit repair services don’t have the legal power to remove negative data from your credit reports. If any credit repair service company claims it can restore your credit by removing negative credit information, immediately contact the Better Business Bureau (BBB).

Authorized under federal law, the Credit Repair Organizations Act mandates three important rules that credit repair service companies must follow:

  • You have three days to withdraw from a credit repair service contract
  • Credit repair companies never accept contract payment, until they full deliver the services spelled out in the contract
  • Credit repair companies must create and abide by the terms of a written, legally binding contract

Creditrepair.com reviews rarely mention that the company violates any of the three indispensable rules that legally bind credit repair companies.

What Stands Out in Creditrepair.com?

Creditrepair.com makes three service claims that myriad reviewers use as the foundation for their reviews. The company works with clients to challenge negative credit report information. In addition to helping you identify negative credit report information, creditrepair.com also makes sure your credit history is current and most important, accurate.

Creditrepair.com reviews also praise the company for monitoring current credit report changes and informing you immediately of the changes. You set up this vital communication tool via email or text message. Finally, the company works with clients to keep healthy credit scores. Creditrepair.com offers several educational tools and a powerful technology guide that provides you with tips on how to remain credit worthy.

Customer Service

Customer service plays an integral role in choosing the right credit repair company. If online reviews and information gleaned from the BBB comes into play, then creditrepair.com ranks high on the customer service scale. It’s not just prompt and friendly customer representative service. You also benefit from customer service representatives that know how to implement successful credit repair strategies. Creditrepair.com reviews often mention the strong educational support they receive from the company website.

Timing and Pricing

The amount of time it takes to see tangible improvements in credit scores varies among the reviewers of Creditrepair.com. Although many reviewers applaud the company for enjoying credit score improvements after only a few months, other reviewers lament the six to 12 month period it takes to notice credit score changes. Several Creditrepair.com reviews discuss the above average cost of the company’s credit repair services.

The Bottom Line on Creditrepair.com

Creditrepair.com scores high in numerous customer review categories, especially for the company’s prompt and knowledgeable customer service representatives. Although not quite a mixed bag, the company receives negative comments about the amount of time it takes to see tangible credit score improvements.

The Better Business Bureau acts as the epicenter for compiling consumer input. For Creditrepair.com reviews, the BBB presents a couple of areas that Creditrepair.com needs to see improvements. The BBB mentions the short time Creditrepair.com has operated, as well as the complaint volume for a company of its size. Remember that the BBB typically acts as a clearinghouse for consumer complaints, not an agency that receives much in the form of positive feedback about any company.

 

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June 28, 2012, 6:00 am

How-to Crush Your Debt Forever

by: MD    Category: Credit Rating & Credit Bureau

Is your debt holding you back from the life that you want? Do you want to finally start saving more money?

It’s time to take a step back and look at crushing debt. I enjoy writing about making more money, starting a business, and working on cool projects. The thing is that many readers are in a position where they’re still stuck with debt and can’t make too many moves for the time being. I totally understand that. This is why it’s important to focus on getting rid of that debt.

I wanted to put together a primer on crushing debt to help you get started and build some momentum.

How can you crush your debt forever?

Calculate how much you owe.

Do you know how much you exactly owe? The first step in dealing with your debt is to figure out how much money you owe in total.

When looking to see how much money you owe, I recommend considering the following thoughts:

  • How many outstanding credit card balances do I have?
  • Do I have to pay my parents back?
  • How much school debt do I have?
  • Who needs to be paid back first?

Once you figure out how much you owe in debt, you can move forward. You just need to know where you stand.

Decide which debt to attack first.

Which debt are you going to deal with first?

There are two schools of thought here.

  1. The first belief is that you should attack the debt with the highest interest rate first. This is the mathematically correct option since you’ll be saving yourself money in the future on interest charges.
  2. The other school of thought is to go after the smallest debt first. This strategy is all about chasing after a quick win. When crushing debt, you can get pretty discouraged at times. This theory believes in psychological boosts that come from seeing results.
Both options work. The end goal is pay off your debt. It doesn’t matter how you get there. I just want to make it easier for you.

Find a side gig.

It would be totally helpful if you found a second gig to help you deal with the debt. The more money you have coming in, the more you can put towards your debt. Thus allowing you to become debt-free much quicker and ahead of schedule.

The hidden benefit of working extended hours is that you can prevent yourself from spend money by being at work. It’s tough to spend money when you’re at work. Whenever I want to get hardcore about my savings, I pick up the amount of hours that I work.

Automate your payments.

Setup your bank account so that your debt payments are made automatically. You don’t want to be the victim of a simple mental error. This is why I believe in automation. Once you set your payments up, you can forget them.

Keep on going.

This is the least fun part. You just have to keep on going. There are no shortcuts here. Just repeat. Viciously pay off your debt with your eye on the prize. Don’t forget to still have some fun (without the plastic).

Reward yourself once in a while.

I don’t want to see you snap on your road to becoming debt free. This is why I recommend that you reward yourself after a small win or when real progress is made. A reward doesn’t mean that you put yourself into more debt. It can be something simple like a night out or a dinner at your favorite restaurant. I want you have to fun and feel good about what your doing. Burnout can be avoided by simply treating yourself when you deserve it.

I have more on this in my premium guide, Completely Conquer Credit.

That’s how you can become debt free. You won’t be debt free today or tomorrow. If you stick it out you can have a credit card balance of zero in just a few months.

Once you’re debt free you can quit your job, build your savings, go on more trips, and live the life that you want. It all begins today with the first step of your journey. I hope you’re ready.

What are you doing to crush your debt?

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September 30, 2010, 7:14 am

Future Shop Rant

by: The Financial Blogger    Category: Business,Credit Rating & Credit Bureau

 

It has been a while since I wrote my last rant. But this morning, I have a good one that I wanted to share with you. I find it very unfortunate because I usually like going to Future Shop. In fact, going to Future Shop feels like I was 10 and going to Toy ‘R’ Us (now I have to hide my joy when I enter with my kids ;-0 ). So here’s my Future Shop Rant Story:

It all started yesterday morning while I was comfortably installed in front of my computer for my blogging day. My wife comes to see me and says that the washing machine just died. Sad story, it was part of my life for a good 10 years. However, what is really sad is that I have to buy another one. This wasn’t the greatest news of all.

So after dinner, I go to Future Shop to buy another one. They had a great promotion on the Samsung (paying taxes, delivery, taking my old scrap for free, $200 gift card and they are offering to pay in 36 payments without interest… I’m in heaven).

So I first have to hear a 5 minutes babbling about how great the extended warranty is a scam…I mean valuable (did you know that it takes 9 to 10 hours at $50/hour to change de rubber on your frontal washing machine?… RIGHT!).

So I tell her “no thx”, she tells me “are you sure?” and I stand up and say “no” and replies with her eyes wide open “REALLY??”, and I answer “REALLY” and she end-ups with “so you are going to walk away with your  brand new washing machine without extended warranty?” and I reply a dry “yup”. End of the lengthy and useless conversation. So I was already a bit annoyed but I was happy to have a new set to be delivered quickly. Then, we moved to the customer service center since I didn’t have a Future Shop credit card (for the 36 payments option).

I had to spend a good 25 minutes in front of a lovely lady hanging on a phone to know if my card was approved or not. I was asking for a *huge* amount of $2,000, just enough to cover my expense. Well guess what? I got declined at Future Shop!

I was quite upset because:

#1 I had to waste 5 minutes arguing that I didn’t want the extended warranty.

#2 I had to wait 25 minutes watching a stupid movie preview in loop on the tv waiting for my credit card approval.

#3 I got declined at Future Shop for a stupid and small credit card; this is very insulting.

#4 When I returned to pay my washing machine (with my own Mastercard Platinum!), the girl made a mistake on the bill and was charging me $80 more.

I asked her to credit my card right away but she had to see her boss first… another 10 minutes waiting to get the approval from the sales director…

I had been annoyed by Future Shop the last time I’ve ordered a iPod Touch for one of our contest (over at The Dividend Guy Blog) because they made me call twice to confirm my order (and each time you have to wait a good 10 minutes on the line). But now, I have not only wasted almost an hour of my time, but I got declined for a stupid commercial credit card. It was a very insulting feeling (especially since I make more than enough to pay those stupid appliances). The worst part is that I couldn’t even know why I got declined. I supposed it’s because I wasn’t sure about my Social Insurance Number but getting my credit bureau nonetheless should have been more than sufficient to get an approval.

Anyway, I hope I’ll get my washing machine and dryer in a good order… if not, I’ll start to stink in the upcoming days!

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