Everyday Fixes for Credit Scores

Credit. Credit. Credit. Do you ever get tired of people talking about credit or asking for your credit score? Companies used to have IOUs and you would pay them back when you could. Credit has become an ugly monster in the world of finance. It has destroyed lives, caused suicide, caused health issues such as high blood pressure, depression, fear, anxiety and hopelessness. Is this the effect that credit card companies had in mind when they created credit in the 1950s? I don’t think so but greed has caused them to operate as a mafia.

Some owners, customer service representatives and collection agencies have no remorse, no feelings, and refuse to provide good customer service to help clients who are willing to pay back debt owed. Sometimes you feel as though you committed a crime based on how potential employers, current employers or companies treat you when they look at your credit score or when you owe a company money.

Credit is one of the most important aspects of your financial life. It is easy to create a credit history but can be hard to maintain. One you have bad credit it can take years to recover and establish good credit again. Here are 13 everyday tips on how to raise your credit score.

1. Pay bills on time
2. Get current on late payments
3. Pay more than the minimum monthly payment – pay multiple times per month
4. Pay late accounts in 3 installments
5. Re-age accounts
6. Get paid delinquent (negative) accounts removed from your credit report
7. Ask for a settlement or setup payment bills for late accounts
8. Ask a company not to report a late payment on your credit report if it is less than 90 days late
9. Open a secured credit card or a department store credit card to establish credit history or increase your credit score
10. Avoid cash advances, payday loans and home equity loans to pay down debt
11. Don’t open new accounts often
12. Don’t close old accounts that are 2 or more years old, this will lower your credit score
13. Keep credit card balances at 20% or less of the credit limit

10 Ways to Search for a Secured Credit Card

1. APR – can have a standard or introductory rate. Can range from 7.90% to 49.9%, average ranges from 9.72% to 22%.

2. Annual fees - average fee is $40 per year

3. Minimum deposit – average deposit required is $300

4. Maximum deposit - amount deposited may depend on consumers annual income and line of credit desired, average is $10,000

5. Red Flags - look for low interest rates and fees, beware of scams, reporting to the credit bureaus – Experian, Equifax, and TransUnion, deposits, avoid cards with high fees and high interest rates, avoid cards that use your security deposit, income and age restrictions, if the card has a grace period, ask if the card is reported as a secured credit card on your credit report – this may affect future approvals for credit

6. Requirements – requires a savings or checking account with the bank, credit limit is 50-100% of the deposit, for savings accounts the limit can range from $300 to thousands of dollars, money is deposited into a savings account or CD, offer same features as an unsecured credit card

7. Earn interest – if it is a bank card they may pay interest on your deposit, the interest rate varies from 2 to 6.17%, if you deposit more than the minimum or are required to make a high deposit - it is to your advantage to ensure you earn interest on the money

8. Deposit Refund – if application is denied, refund is used to pay outstanding balance and any money left over is mailed to the consumer, may be charged penalty for early cancellation

9. Additional fees – application fee, processing fee, annual fee, finance charge, the application fee may be non-refundable depending on the company, cash advance fees, over-the-limit fees, non-sufficient fund fees, accessing account information, exceeding maximum number of transactions per month

10. Conversion – the account is not touched unless you make a late payment, after making payments on time for at least a year you may be able to qualify for an unsecured credit card, ask if your card can be converted to a unsecured credit card, account may be closed by bank if the account is seriously delinquent

How to Repair Your Credit

You credit is one of the most important aspects of your life and can help you or hurt you during the course of your life. Credit affects many aspects of your life such as applying for a job, applying for a home or apartment, or applying for a personal loan or credit. Some people have been fired from jobs or have not been considered for job vacancies because of their bad credit. If you have bad credit it is never too late to fix it and improve your financial situation. Here are 10 tips to help repair your credit.

1. Order your credit report. Get current on late bills and dispute errors. Dispute errors online or by mail. Provide supporting documentation.
2. Get current. Pay late accounts such as judgments, tax liens, foreclosures, repossessions and collection accounts first. Then pay all other late accounts.
3. Pay down debt. Keep balances at 20% or less of the credit limit. Having credit cards with balances of 50% or more of the limit decreases your credit score.
4. Pay on time. Pay bills at least 7-10 days before the due date to avoid late fees and penalties.
5. New accounts. Opening more than one new account per year will lower your credit score.
6. Avoid closing accounts. Closing accounts that have been open for 2 years or more can decrease your credit score.
7. Negotiate. Setup payment plans to pay down debt if you cannot pay the full amount owed. Stick to the agreement until the account is paid in full.
8. Establish Credit. Open a department store credit card. They usually have the highest interest rates but provide easier approval than bank credit cards. Buy something small and pay the balance in full each month. You can also open a secured credit card account. Ensure the account is reported on your credit report. Get a card with low fees and a low interest rate.
9. Avoid risky solutions. Avoid filing for bankruptcy. Use bankruptcy, debt consolidation, credit repair counseling or debt settlement as a last resort. These are reported on your credit report and lower your credit score.
10. Financial Crisis. If you are currently unable to pay your debts due to unemployment or financial problems request a financial hardship. You can request a reduced monthly payment and reduced interest rate for a period of one year but you must provide supporting documentation.