FinanceDogma – Finance, loans, creditcard and mortgages

June 3, 2013

Credit Card Debt Management

Filed under: Credit Card — Tags: — admin @ 8:29 pm

If you are looking for ways to manage your credit card debt and get your finances back in order, you should understand a few things about how credit works. Credit is not something that you just use to delay making payments, or because you think that the lower monthly payments means less money out of your pocket. Credit card debt management needs to be taken seriously and understood properly so that you can get rid of your debts.

Credit Card Debt Management Strategies

Pay More Than The Minimum

If you are able to do so, pay off more than the minimum amount that you owe on your credit card. Better yet, try to pay the full balance off before the end of the 30 day billing cycle. Doing so allows you to avoid paying interest on the things that you charge and allows you to not have to worry about making a payment each month because the bill is already paid in full. Even if you cannot pay off the full balance, paying more than the minimum reduces your balance and allows you to get ahead on your debt.

Lower Interest Rates Mean You Win

The easiest way to keep your credit card debt under control is to get a card with the lowest interest rate. Try going to a credit union as opposed to a bank, or a store credit card. You will usually get a lower interest rate on the card. You might not get the balance that you would like, but at least you won’t have a higher bill each month than you can afford. If you find that your interest rate is too high for your tastes, you can always transfer your balances to a lower interest credit card if you are eligible to do so. Debt consolidation can get you a lower interest rate, and put all of your credit balances into one payment and make it easier to pay off.

Pay Down The Highest Interest Card First

Take all of your cards and determine which one has the highest interest rate. Pay down that card first and get rid of the most expensive payment you have each month. As you pay down the balance on your first card, you can start paying more attention to your other cards because you will have more money each month to pay off your other balances. You can keep your payment the same, but change how much you allocate to each card each month as your balances and interest charges get to be lower and lower. This works really well no matter how many cards you have.

If you are looking for ways to pay down your debt, the best way is to list your debts, figure out how much you can afford to pay each month and then just pay the debts as they come due. There is nothing else you can do and no magic formula. The easiest way to manage your debts is to simply face the fact that you have bills to pay and pay them off as best you can in the least amount of time.

Finally, you could also look for some kind of credit card debt management program to with a for profit or non-profit company in order to help you with your needs.

June 13, 2012

Understanding your credit score

Filed under: Credit Card — Tags: — admin @ 9:59 pm

A great deal includes credit scores, especially recently due to the collapsing housing bubble and also the issues that came about from this. But just what involves identifying your credit score? Could it be foolproof or can you find difficulties with the machine? What defects exist? Does everybody still utilize it or is there other techniques getting used recently that people haven’t learned about?

What’s Your Score?

You will find several factors which go into identifying your score. Varying between 300 and 850, the score is affected through the following elements that are distributed within the following criteria: Payment history, Credit Utilisation, the peroid of credit history, the types of credit used and the recent requests for your credit score.

By looking into making your repayments promptly, getting a great period of credit history, and keeping a great ratio of credit accustomed to available credit you can preserve your score nearer to the greater end on the credit score spectrum which can lead to you getting further advantages on financial loans, including preferential rates.

Issues With The Scores

Some institutions have, a minimum of, used credit scores for a number of reasons, you will find some difficulties with the practice and also the scores which have given people stress about their stability when identifying how appropriate for a financial loan one is.

The greatest concern within the method is they could be used to improperly provide a better perception of the person’s credit standing. Since most from the score is dependent upon the ratio of credit accustomed to credit available, an individual can improve their credit limit on the credit card in order to improve their credit score despite the fact that it has no effect on remarkable ability to pay back financing.

Additionally, the main critique from the score product is it’s a bad predictor of risk when lending for an individual. This grew to become apparent throughout the housing crisis when banks were supplying subprime financial loans that individuals could not manage to pay back no matter what their score indicated since the moment the rates elevated around the loan they could not afford them.

Still Being Used?

Despite the fact that there’s some critique of these, the scores continue to be broadly employed for from loan programs for such things as houses and cars with a companies which makes it an ailment from the employing process. Some, however, are generally completely abandoning using credit scoring or will also be considering a possible purchasers current debt and employment status and earnings when thinking about them for a financial loan, because this provides a better picture of the capability to pay back the borrowed funds.

Know What Your Location Is

Even when you are not searching to create a large purchase soon that will need a loan, knowing where your score stands is a great way to know whether you have to focus on enhancing it. Additionally it is also a great way to discover if you have been the victim of id theft as possible discover if you will find open credit cards or financial loans inside your title that you simply did not authorize.

April 10, 2010

Is it possible to repay credit card debt all by yourself?

Filed under: Credit Card — Tags: , — admin @ 9:33 am

There is nothing wrong in using credit cards for making payments as long as you’re able to clear the outstanding balance every month. The problem arises when you cannot pay off the existing balance and accumulate debts on your cards. In such a situation, a credit card payment calculator can help you to compute how many months you require to repay a balance if you continue making a fixed payment every month.

Ways to repay credit card debt

It is not always necessary to take professional help in order to repay credit card debts. You can very well do it yourself. Go thorough the following lines to know how to repay your credit card debts without professional help.

* Snowball your payments

It is a method of paying off your highest credit card debt first and then move on to repay the next highest one and so on till you pay off all your credit card dues.

* Transfer high interest debt to a low interest card

With your creditors’ approval, you can transfer your high interest rate debt to a card with comparatively lower rate of interest. Thus, you can pay off your balances relatively fast. You can also get a zero interest or a low interest credit card if you don’t have one.

* Pay more than minimum monthly dues

You can take help of a credit card payment calculator to compute how long it will take if you continue making minimum payments on your credit cards. It is advisable that you increase your monthly payments as and when your financial condition permits you to do so. It will help you to repay your credit card balance quickly and you can save the money that you would have to pay as interest if you continue paying only the minimum monthly dues.

* Liquidate your savings accounts

You can liquidate some of your savings accounts to pay off your high interest credit card debts. Make sure you don’t liquidate all your savings accounts as you should have funds to overcome emergency situations.

One of the best ways to pay off outstanding credit card debts is to borrow the required amount from your family. It is a better alternative than taking out a loan from any lender. However, make sure you repay the borrowed amount as soon as possible.

February 23, 2010

Take Control of your Credit Card Debt

Filed under: Credit Card — Tags: , — admin @ 1:52 pm

Question: Is it so easy to eliminate credit card debt?

Answer: No it is certainly not easy, but it is possible, with the right approach almost anything is.

This is your current position.  You started off with a certain credit card; found that buying things that were once out of your reach became quite easy.  So buying is what you did, and boy was it a good feeling. The purchase didn’t cost that much and the monthly repayments were easily dealt with.  Then there was that certain something else; okay you can afford it, the money is there.  So you got that buzz back, it only made a slight difference to the monthly payment, so who cares.  And on it goes, little by little your credit is run down, the interest charges go up and soon you are at your limit.  But you still crave that spending power.  So you take another and you swear you will use this one wisely.  It is only a short matter of time before you are in the same boat once more, except now you have two cards and a debt that is becoming increasingly difficult to control.

STOP!!!!!

You are heading down a road which is difficult to return from.  Look at what you are doing and realise that this is pure self destruction and no good can come of it.

Pretty soon the bills will go unpaid and the charges will ultimately build up.  Now there is little respite because you have damaged your credit history with the late payments.  There is no way out.  The sound of the phone ringing brings fear, and you dare not go and see what letters have just fallen through the post box.

There is a way to avoid this. First of all you will need discipline and self control, but you can get control back.  Contact everyone you owe money to, explain the situation you are currently in and make an offer that is realistic and which will get them off your back.  If they feel you are not in the position to offer more, they will accept.  They want to see their money coming in and bankrupt clients can’t do this.

Once these offers are in place, you must adhere to them; they won’t like perceiving that you have given them the run-a-round.  Having acted in good faith, you must do the same.

Now this is one for the long haul:  You will not see the problems disappear overnight.  You will find a modicum of control back in your life so build on that. Seek to eliminate all those debts so you can be proud of that achievement.

February 8, 2010

Saving Money Through Cash Back Credit Card

Filed under: Credit Card — Tags: , — admin @ 2:56 pm

Credit card companies have been launching cash back credit card programs which look very enticing indeed.  This is especially very ideal for credit card users who are able to pay their entire credit card bills monthly as they will be able to enjoy this cash back deal to the fullest. Still with all kinds of programs that the financial companies are offering, you should not grab the first offer that comes your way because you could miss out  on better deals by the other companies which you did not bother to scrutinize.

Before, very few credit card companies dared to give cash back credit cards, thus, most individuals consider cash back credit cards as free cash which should be appreciated without too much question.  Today, however, almost all credit card companies are already offering this program and people no longer take it as simply a bonus from the credit card companies but as the most suitable type of credit card for clients who are big spenders and are able settle the entire used amount monthly.

When paying the bill in full every month the client will not have to pay any interest charges and therefore will not benefit from any offers that have something to do with lower rates or zero per cent interest rate.  This was an issue that the credit card companies recognized as they were campaigning for clients to pay their bills in full. And then, regardless if you pay your bills on an installment basis or in full monthly, credit card companies will still be earning from you for facilitating the credit card transactions using their credit card payment facilities.

Thus, today, the cash back credit card is not just a complimentary gift dispensed by the financial companies to benefit the client, but is actually a scheme to entice clients who are big spenders and good payers to continue paying their bills in full monthly as they could ultimately bring them big revenues.

In this case, you have to carefully choose which among the credit card companies are giving you the best deal as far as cash back credit card is concerned.  Do some research online and look at the offers of all the companies offering this benefit.  A lot of times, online companies are offering much better cash back returns than those that you find in the mail.  Spend sometime to analyze their offers, accomplish the online applications and see if you can get a better deals with these cash back credit cards rather than those offered by the standard financial companies.

January 26, 2010

The Purpose Of Lifetime Balance Transfer Credit Cards

Filed under: Credit Card — Tags: — admin @ 4:40 pm

The reason to use lifetime balance transfer credit cards is to get out of credit card debt. You have probably looked at your mountain of credit card bills, especially those store cards with their exorbitant interest rates and wondered how you wound up in so much debt. The first answer is overspending, but the second is interest.

Take almost any credit card and you will see that you are spending upwards of 15% on interest alone. Add to that the fact that interest compounds and your balance can easily multiply from the amount you actually spent.

There is only one way to get out of credit debt and that is to pay off your balance. Of course, paying off your actual balance is difficult when interest fees add up at such an alarmingly fast rate. This is the purpose of lifetime balance transfer credit cards, to save all that interest money.

By moving your balance or balances over to a lower rate interest card you can reduce the amount you spend on those fees by hundreds if not thousands of dollars. That makes your monthly payments lower and frees up cash to kick toward your bill. Paying off your bill faster saves money on interest charges.

The reason to choose lifetime balance transfer credit cards over a zero balance transfer has to do with the amount of debt that you carry. If it is substantial you probably can not pay off your debt within the six or twelve months that the zero interest period lasts on those cards. Once that period is over the rates jump right back up, probably close to what you were paying on the old card. That is no way to save money. The lifetime card remains at a low rate until that balance transfer is cleared.

Lifetime balance transfer credit cards:

* Low interest rates that are either fixed, meaning they remain the same all the time, or variable, meaning they stay low but adjust with the market rates.
* Faster pay off means more savings. These cards still accrue interest, just at a slower rate. Even though you have a long time to pay off your debt you will maximise your savings by setting up a budget to pay it off as soon as you are able.
* Never miss payments. One of the things that trips people up are the terms that come with a credit card. Usually if you slip up and miss or make a late payment you will not only get hit with a fee but you will lose your low interest rate. Do not do this, not ever.

It is easy to save money with lifetime balance transfer credit cards. All you have to do is decide that you are ready to stop paying high interest rates and start paying off your debt. Make the transfer and save the cash, it is really just that easy.

March 26, 2009

How credit card works?

Filed under: Credit Card — Tags: , , , , — admin @ 2:06 pm

Most of us knows what a credit card is and how it looks like. It´s a piece of plastic that will allow you to buy things now, and pay for them later. Most common credit cards are called for Visa, MasterCard and American Express.  The card you are using has the size of 3-1/8” x 2-1/8″.

Credit Cards

Credit Cards

There is the shiny strip on the back side of the credit card that is known as “magstrip” and it is the main thing on your credit card. It contains all the details on the card and the amount of credit that you are entitled to. So, when the person swipe the credit card on the machine, the “magstrip” will read the information of your card and send it to the central tracking system. The central tracking system has all the information on the balance details, country, zip code, card owner etc.

To protect your personal information (on credit cards) from identify theft, there is a computer chip embedded in your card that requires you to identify yourself every time you use the card. You really don´t want somebody else to use your credit card to buy stuff for him/her self, right?

With great power comes great responsibility right? Same thing is applied with credit cards. Credit card is a very useful tool when you are shopping but only if you use it wisely. So, remember…be a smart shopper!

February 17, 2009

3 Major Disadvantages of Bad Credit Card

Filed under: Credit Card — Tags: , , , , — admin @ 3:49 pm

By having a bad credit you will not be able to receive good credit card offers. Instead, credit card companies will charge you with quite unreasonable charges. Here is a list of 5 major disadvantages of owning a bad credit card…

High APR (annual percentage rate)

With bad credit comes high APR on credit cards. To be able to lower APR on your credit card, you will need to make your credit card “secure”. In order to do that, you will need to link a good collateral or bank account to your credit card. If you can´t “secure” your credit card it will result in high APRs and low credit limits.

Huge annual fees

Credit card companies are taking a risk when they are issuing a credit card to people with bad credit. They are also aware that people with bad credit are usually desperate to find a credit card which can help them improve their credit history. Knowing this, credit card companies will probably demand high annual fees for people with bad credit.

Low credit limits

Having a bad credit will result in low credit limit on your credit card. What is the biggest problem in having a low credit limit? The biggest problem would occur if you exceed your limit. Your card issuer would charge you with a penalty interest rate, which you definitely want to avoid.

February 10, 2009

Pre-paid credit cards

Filed under: Credit Card — Tags: , , , — admin @ 12:02 pm

Do you want the security of a credit card without the interest rate every time you need to use it? All of the interest rates on a regular credit card can bring you down in debt if you don’t watch what you spend your money on. Some cards offer no interest rates until a certain year, or if you refer a friend you get something, but do you want to refer a friend to an 18.9% interest rate? No one wants to bring a friend into debt, but with the pre-paid credit cards, you don’t have to worry about that.

Pre-paid Credit Cards

Pre-paid Credit Cards

(more…)

January 1, 2009

Know about Credit Cards

While using Credit Cards offer numerous benefits, one needs to be careful on choosing a credit card and should understand the right way to spend thru it. Improper usage or spending beyond your limit may lead towards debt. Although a credit card offers the advantage of paying the dues in small amount or a minimum payment, the card holder should understand that paying just the minimum amount due would take years to clear off the dues.

Shopping and Safety

Credit Cards are widely used for online purchases or conventional shopping expenses. It eliminates the need of carrying cash which carries the risk of burglary. Even if you lose your credit card, the Credit Card companies offer the convenience of immediately calling them and disable the particular card. You may no longer be liable for purchases made after reporting the loss of card.

Money at the time of need

Credit Cards offer the benefit of withdrawing money from ATM which is of great help when you are outta money. Even If you don’t possess enough money you could still afford to buy your desired products through a credit card and pay money after few days (next billing cycle).

Reward points

Most of the credit cards offer flashy gifts which could be purchased thru the Reward points. When you make a purchase through your credit card, you gain some reward points. Based on the number of reward points you have, you could redeem it to buy gifts offered by your Credit Card Company.

Choosing the Right Credit Card

Choosing the right credit card is a chaotic job for any greenhorn. You need to compare various credit cards offered by different companies. You need to analyze the APR (annual percentage rate), interest free period, Cash Advance facility, Balance Transfer facility etc.

Powered by WordPress