Health Professional Student Loans

Category: Finance, Credit.

There are quite a few benefits to consolidating your federal student loans, making it something you should give serious consideration if you have such outstanding loans.

After consolidation, borrowers only have one lender, the Department of Education, making it much easier to manage the debt. These benefits include: You have a single monthly payment. It may reduce your loan payment. There is no minimum or maximum loan amount, and no fee for consolidation. The minimum payment amount of the consolidated loan may be less than the combined payments of your previous loans. You may get new or renewed deferment options for your loans.

Loans may be consolidated in two ways- directly with the federal government using the U. There are several different repayment options, with the ability to switch repayment plans at any time. For students who have borrowed heavily, the Direct Federal Loan Consolidation program may be a good option. Department of Education Direct Federal Loan Consolidation program, or through commercial lenders using the Federal Loan Consolidation program. It includes a special income- contingent option that brings all obligations together into a single new consolidated loan with a monthly payment structure based on the borrower s income level. As your income rises, your loan payment amount will rise accordingly. The lower your income level, the lower your payment.

The repayment period lasts until the loan is repaid, up to 25 years. One negative of the Direct Federal Loan Consolidation program is that it results in the payment of much more interest because of the long repayment period. After 25 years, the remaining amount of the loan is repaid by the federal government, with the borrower the subject of a tax liability for the amount repaid. Therefore, this option is only recommended for students who are absolutely unable to make a normal payment. And. The following types of loans qualify for inclusion in a Federal Consolidation Loan: Subsidized, and guaranteed Stafford, unsubsidized loans; Perkins or NDSL loans; Supplemental loans for students; PLUS loans; Federal insured student loans.

Health professional student loans. If you are still in school, you cannot consolidate your loans. To qualify for a Direct Consolidation Loan, you must have a Direct Loan or Federal Family Education Loan( "FFEL" ) that is in one of the following states: in grace, deferment, repayment, or default. Perkins loans by themselves cannot be included in a Direct Consolidation Loan- there must be non- Perkins loans as well. It may not be advantageous to add Perkins loans to a Direct Consolidation Loan, because you will, however lose the special benefits that are attached to Perkins loans. Perkins loans that are consolidated will be unsubsidized.

If your loans are in default state, they can still be consolidated if satisfactory arrangements are made with the lending institutions or you agree to repayment under the Income Contingent Repayment Plan. A better option is to rehabilitate the loan before consolidation. One thing to keep in mind is that, although loans in default can be consolidated, they will remain in a default status on your credit report. The status of the loan on your credit report will then be updated to reflect that it is current. However, you should now see that there are many options when it comes to consolidating your loans. We ve just scratched the surface of what there is to know about student loan consolidation.

Consolidation can definitely make your life easier and is something you should consider if you are currently making payments on multiple student loans, including private student loans.

Read more...

Does Bad Credit Mean You Can T Rent An Apartment - Finance and Credit Articles:

Not too many people realize the damaging effects of having a bad credit until they re stuck in the actual situation. If you think your credit report would not be questioned by a landlord, you re mistaken.

And What You Get Is Freedom From Debts And A Sigh Of Relief

Category: Finance, Credit.

Debt solution services available online these days apart from other means of media prove to be very helpful to the debt- ridden borrowers.

These services aim to ease out your debt situation by helping you to reduce your payment amounts. Even those with a bad credit history stand to benefit well with these services. This can be done through different methods such as reduction of interest rates and merging of several debts into one. It helps you to make the necessary repayments on time. Debt consolidation is thus a very viable solution for handling your debts. Once you are able to make your repayments on the due dates, you can safely get out of the debt imbroglio. Of course, courtesy the debt, this is done solution services.

At the same time, you do a good job to repair your dented history. And what you get is freedom from debts and a sigh of relief. This financial scheme helps you to consolidate your existing debts into one large sum such that you can make easy repayments under one account. As mentioned, among the best debt solution schemes, debt consolidation provides an effective way to get out of debts. Also the rate can be negotiated at what may be suitable enough for you. Debt consolidation comes as a happy debt solution to most people who are under the burden of debts, since it allows them to shed it off in a manner that they can afford. These services are generally offered by the financial experts who can deal professionally with your lenders to convince them to make the terms and conditions convenient for you.

The new consolidated interest rate is generally lower than what you would be paying out to different lenders. You are also saved the hassle of remembering different due dates to make your settlements, instead the dues are settled in easy instalments under a single account.

Meanwhile, Shoppers Aged 35 To 55 Leave Some 68 Pounds Worth Of Clothes To Gather Dust In Their Wardrobes

Category: Finance, Credit.

Britons debt consolidation problems are potentially being exacerbated through unnecessary shopping, new figures indicate. Mike Hoban, customer and brand marketing director for Scottish Widows, said: "Shopping may be fun but, as this study shows, a large proportion of the money we spend on clothes and shoes is going to waste in our wardrobes instead of staying in our wallets. " Findings by the financial services firm also revealed that men could potentially have the highest difficulty meeting personal loans, credit cards and utility bills through buying unworn clothes, as they were reported to spend an 6, 241 pounds on items which will only be left in their wardrobes and drawers.

According to research conducted by Scottish Widows, the average consumer wastes some 6, 044 pounds on unwanted clothes and shoes over the course of their life- an amount of money which, could help many, if used wisely with personal loan repayments. Meanwhile, women were said to waste 5, 846 pounds on unwanted items. Those aged 18 to 34 were reported to be the biggest shopping wasters- hoarding about 90 pounds worth of clothes every year. Mr Hoban suggested that if consumers set aside some of the money they would normally spend on" must- haves" then they could be taking steps to secure their financial future. "By simply taking a few moments to consider whether you actually need to buy the item in the first place, you ll be able to cut down on non- essential purchases and save lots of money in the process, " he added. Meanwhile, shoppers aged 35 to 55 leave some 68 pounds worth of clothes to gather dust in their wardrobes. Overall, some 70 per cent of women were reported to have lied about their spending at least once, with 57 per cent of males also said to have done this. The study also indicated that more than half of respondents( 60 per cent) bended the truth about how much they spent on clothes.

Londoners were revealed to have hidden the cost of their clothes the most, with 65 per cent of those in the capital said to have bent the truth. Earlier this month, a study by Abbey revealed that unforeseen expenditure, which may incorporate splurging out on" must- have" clothes, accounts for an average of 1, 375 pounds per consumer last year. Such shoppers were also reported to account for 63 and 60 per cent of consumers in Scotland and the north of England respectively. To meet these expenses, which could see consumers incur difficulties paying off personal loans, some 37 per cent were reported to have used their credit cards, with seven per cent of respondents borrowing money off a friend or relative. He warned: "You never know what life is going to throw at you. " The study also indicated that those living in the south- east could be experiencing the worst debt management difficulties as 83 per cent of adults in the area have been forced to make unexpected payments. As a result, Reza Attar- Zadeh head of savings for Abbey, advised Britons to create a" buffer savings fund" to help guard against any unexpected debt consolidation difficulties.

Read more...

A Business Credit Card Is Considered As A Valuable Gift To The Entrepreneur - Latasha Ramsburg about Finance and Credit:

Whatever kind of business you might be involved in, be it a small business or a big one, to run the errand of business dealings, expenses towards organizing, operations the business and to save money at the end, it is necessary to own a business credit card which is designed according to the needs of today s business community. Many banks boast that they can issue a tailor made business credit card to suit every business man.

Which Is One Of The Crucial Steps To Repair You Bad Credit - Finance and Credit:

Most people do not know about the Wage Earner Plan.

Different Methods For Charging Interest - Aida Tidmore about Finance and Credit:

Credit card interest is the principal way in which card issuers generate revenue. The bank pays the payee and then charges the cardholder interest over the time the money remains borrowed.

As You Won T Have Access To New Credit Cards, This Can Actually Be A Blessing

Category: Finance, Credit.

Many individuals consider bankruptcy as a simple way to remove a massive debt burden, and it s often the first thing people consider when struggling financially. While legally it is relatively straightforward in the UK to actually file for bankruptcy, as with any, the steps legal case, can be far from painless.

Whilst it could well help with a bad financial situation, it s not always straightforward and should be seen as final option. You ll have to justify your application, showing all your credit history to a judge and exposing it to objections by creditors. Even if you re successful, there are various impacts that you ll need to review before taking such drastic action. If you owe them a lot of money, they are not likely to settle easily with minimal repayment offers. You will surrender any credit cards that have money owing and others will more than likely close your account. Depending on your family situation, it is possible that you may even lose your home. You ll additionally find it near impossible to acquire a mortgage or other large secured loans.

Not every debt is covered by a bankruptcy filing. Even after you fulfilled the official time period for bankruptcy, you could still find that your financial record is poor and obtaining any credit in the future may be almost impossible. You need to check details thoroughly as many loans, taxes and some other debts can be exempt from bankruptcy protection. Of course, this may well be a positive thing in the long run! Unfortunately, there are some people who simply should not be able to obtain easy credit, until they can improve their personal financial management. As you won t have access to new credit cards, this can actually be a blessing.

Beyond the credit impact, you may actually be required to relinquish assets, valuable furniture or, for example jewellery even your car. Courts incur costs and, if you use a legal professional, that will also add additional charges. Lastly, the bankruptcy procedure itself is not free. On the upside, you will get relief from debt collectors( assuming they receive notification) and any foreclosure action will be stopped. It can serve as a huge wakeup call to improve any bad money management habits. By taking action sooner rather than later, you will start to rebuild your credit history that can be advantageous in the long run.

For some, it is necessary to hit rock bottom before finding the required discipline to make long term plans however, as this can be hard, think cautiously and, you should obtain expert advice prior to committing to action.

Read more...

The Final Reason We Ll Look At For Applying For A New Card Is Rewards - Finance and Credit Articles:

Most of us these days carry at least one credit card, and unless careless use means we ve built up a problematic level of debt, we often don t give a second thought to the plastic in our wallets.

There Is Also A Lower Credit Limit To Students - Finance and Credit:

Most students are probably allowed to use extension or supplementary credit cards linked to any of their parents personal accounts when they go to college, but having a college credit card for their own use is just a step towards independence.

So What Makes A Platinum Credit Card Different From Others - Finance and Credit Articles:

Platinum credit cards are considered as the most desired credit cards and to get a platinum card, one requires proving his or her credentials.

These Credit Cards Usually Offer Introductory Rates Of Around An APR Of 19%

Category: Finance, Credit.

Individuals who find themselves in credit trouble often bring this about through spending on unsecured loans. Spending this" free" money often spirals out of control as individuals do not have anything on which to curb their habits.

These loans include credit cards and medical bills, advancements of money without anything put down to secure the debt. The result is overextension to the point where they must seek help in order to repair their credit, which results in a bad credit score. Many credit card companies now offer credit cards that can be used by individuals even with bad credit. To make matters worse, individuals with a bad credit history will find that they have trouble getting any credit in the future on unsecured loans, and without this access many can expect their standard of living to come down. Secured credit cards, as they are sometimes called, give people with bad credit a chance to once again use a credit card and the opportunity to repair their credit on their own. In order to be approved for this loan, individuals must first open up an approved loan account with a financial institution designated by the credit card company.

Unlike other credit cards, these types of cards usually operate on a secured loan basis. This loan will be on a fixed amount, anywhere from$ 300 to$ 5000 and upwards. It is vital to recognize that in the case of a default, the collateral may be put up for auction. In order to secure the loan, individuals will be asked to put up collateral against any default of payments to the institution. Often this will be the cardholder s house or other property. Because of the secured nature of the credit card through the loan, an individual holding a secured credit card is able to determine his or her own credit limit.

In itself, this often provides enough incentive for people with a bad spending history to get back some self- control. This limit is set according to the amount of the loan that is taken out. As is customary with secured credit cards, they make monthly reports to the three credit bureaus of the United States. Holders of this type of card can also take advantage of programs which can help with credit repair. These bureaus are the companies in charge of assessing the credit ratings of individuals from all over the country through access to certain financial information. These credit cards usually offer introductory rates of around an APR of 19% .

With this information, they also compile credit scores and keep up to date with financial habits in order to help an individual s credit score to go back to a positive number. Users of these cards can also expect to pay a fee annually and are comparatively low due to the secured nature of the card. Online services usually include an easy to use application form, access to accounts and account management 24 hours a day, and answers to a number of frequently asked questions. Finally, holders of secured credit cards have access to the Internet options available through the issuing bank.

Read more...

There Are Different Ways To Open A New Credit File Each Of Which Works To Help One Build A New Credit File And Utilize Simultaneously While Repairing Ones Credit Or Establishing Credit - Finance and Credit Articles:

There are different ways to open a new credit file each of which works to help one build a new credit file and utilize simultaneously while repairing ones credit or establishing credit. It is a loophole in the system.

Blue Sky Credit Card Fees - Finance and Credit Blog:

Generally speaking, when you hold a travel credit card, you would be subjected to rather hefty annual fees, expiry dates and, blackout dates capacity- control restrictions.

Better Yet, Find A Credit Card Provider Which Values Promptness In Payment - Finance and Credit Articles:

How many people carry credit cards with a very high annual percentage rate when in fact they started out with zero APR? So to find the credit card with better deals, be sure that you fully understand the system governing your credit card.

The Secured Credit Cards Are The Bad Credit Cards

Category: Finance, Credit.

Millions of people use credit cards all around the world.

The consequence of the errors is costly. A huge chunk of those users made mistakes when dealing with their credit cards. The cost may not just be in money but in your credit score and you reputation as well, not mention that financial difficulties are one of the leading causes of divorce. But fact of the matter is, this is not the case. A lot end up in debt and most of the time these are the people who rant about the credit card being the devil. When used properly, credit cards are very good financial tools.

There are some cards even for the financially challenged, and these are called the: "Bad Credit Cards. " A bad credit card is just precisely that: a card with a very bad or low credit limit. Credit cards are not necessarily just for people who have large sums of money to use. There are two types of credit cards: there is the secured and the unsecured credit cards. The limit of credit is up to the bank s discretion and not up to the size of the bank account. Unsecured credit cards are the accounts that are free from the limits of a bank account. If the bank thinks that a person is deserving of a bigger credit, then it will be given. These are also the cards known to be more respected by other companies.

This is the usual type of credit cards in the market and is fairly popular among the card shopping people. These are also the cards known to send people to a very deep debt. The secured credit cards are the bad credit cards. This is the type of credit card that should be avoided if the applicant is already in a financial mess. These cards are grounded on the size of the account a person has. If there is a point where the balance reaches$ 0, then the person should go and" re- fill" the account.

For example, if a person has a$ 1, 000 balance, then that is all the credit a person is going to get. The bank limits the credit to the money already present to avoid overspending, thus preventing even deeper debt. These credit cards are also known as" pre- paid credit cards" for there is only a fixed amount that can be used and the holder is the one who puts it there. This will monitor the expenses of the person and will help the development of a financial recovery for some.

Read more...

Fees Charged By Credit Card Companies To Use The Credit Card - Finance and Credit Articles:

Credit card companies charge various fees for credit card usage.

It Is Important That You Shop Smart For A Business Credit Card - Rosario Jessen about Finance and Credit:

As a manager or business owner, you always look for better ways to maximize business revenue and control expenses.

Among Those Credit Cards Are The Discover More Cards - Finance and Credit Articles:

There are a lot of credit cards on the market today offering great value to credit card using consumers. Believe it or not this card is available in over 150 card designs that you can personalize and an introductory 0% APR( Annual Percentage Rate) on purchases and balance transfers for 12 months.

So Don T Fear When Applying For A Credit Card

Category: Finance, Credit.

To start up, you have got to be aware that although credit cards come with particular exciting perks like cash prices or gift certificates, it doesn t give you the right to invest more than you re entitled to or you may well end up in debt.

It more so guarantees you a quicker relay of your credit card. A benefit of online credit card registration is that it saves you both time and even finances. Credit card companies that are experts in providing student credit cards use the credit card rate or annual credit card rate( APR) , as a check to stop students from exceeding the credit card limit and as a means of encouraging quick payment of credit card bills. So extreme attention is needed when making use of your credit cards. If you re unable to meet your credit debts because you re too far behind in payments, you stand the risk of facing bankruptcy and may well loose a substantial chunk of your assets in the bid to pay off your debts. The joy of the credit card method is that it s realistic for every person, no matter what, including you wage or condition. Chase credit card, a major credit card company can be found on the Net with a diversity of credit cards like flexible rewards visa signature card, free cash rewards platinum visa card, chase perfect platinum master card and others.

So don t fear when applying for a credit card. You can access the imperative information on the site- www. The attraction of a business credit card is that it facilitates business costs accounting. Chase. com. More over, the business owner can have an account of his costs drawn up for study or for the record. If you re someone who loves shopping at a particular retail outlet, uncover if the outlet supplies credit cards is an excellent way of getting a credit card suited to your requirements. You have got to pay close attention to details when filling out an application for a credit card because any slight flaw may well mar your credibility and even render you ineligible to get a credit card.

At the last, if you re in credit card debt and are planning to consolidate your credit card debt, you have got to make a decision to invest money prudently and meet payments on time. This decision will assist you pay off your debts faster.

Read more...

Different Types Of Cards - Finance and Credit:

You can use an online credit card quote to get hold of a card very easily.

What Can A Business Credit Card Do For Your Business - Fran Hiott's Finance and Credit blog:

What can a business credit card do for your business? This could be the most vital financial tool your business will ever need.

They Offer Four Different Blue Cards - Finance and Credit Blog:

American Express Credit Cards are ideal for both individuals and businesses. American Express Credit Cards are also widely used, but are not as widely accepted as Visa and Mastercard.

To Get A Gold Or Platinum Card Will Often Cost Up To 75 Per Annum

Category: Finance, Credit.

Who hasn t received a pre- approved offer of a credit card in the mail?

They also warn that this offer has time limits, so you must hurry to take advantage of the offer or risk losing this wonderful opportunity altogether. They try to make you feel like one of the chosen few and you pause and wonder what you did to receive such an honor. But be forewarned! One of the important things to consider before opening a credit card account is the annual percentage rate of the card. Those offers usually come with a price attached, so do your homework before you jump into any of these commitments. Some cards also have a periodic rate which is applied to any outstanding balance at the end of each month.

You need to know that the rate may change and how that rate is determined. Some card companies will offer a variable rate that will fluctuate with the rate of interest or stock market values. Some companies will offer a grace period whereby you will avoid any charges if the pay the account in full at the end of each month. The issuer must mail the bill fourteen days in advance to allow time for payment to be sent. It is important to find out if the card issuer has a grace period if you plan to pay off the balance each month or you may end up with a charge whether you use the card or not. There can be yearly membership fees that range in price from 25 to several hundred dollars.

You may also have transaction fees for cash advances, late payments or for exceeding your credit limit. To get a gold or platinum card will often cost up to 75 per annum. You will need to consider if the credit limit is high enough and how widely accepted the card is. Make sure you fully understand the small print before you commit. When applying for a credit card shop around and compare terms and fees. Once you have made your choice, keep your receipts to compare with the bill when it arrives.

Keep your records in a safe place, such as a filing cabinet, along with account numbers and phone numbers to report lost or stolen cards. Protect your card and account numbers to prevent theft and unauthorized use. And finally, don t have more cards than you will use as this increases the risk of having a card lost or stolen, and the chances are, if you don t use it very often you won t miss it until it s too late.

Are You Safer In Making A Credit Card Application Offline

Category: Finance, Credit.

The Internet has changed the lives of many of us in lots of different ways and we can now do our shopping, download music, book flights, software and ebooks, and even apply online for a credit card. Whether you apply online for a credit card for the first time, or are a pro ready to switch to a new low interest rate credit card, there are a plethora of companies and agencies willing to help you find the best credit card deal around.

Making an instant online credit card application is quick and efficient and comparison charts make it simple to find a low interest rate credit card, or the best credit card deal to suit your personal needs. But what about the risks in giving out your personal information online. Well when you apply online for a credit card, every company offering an instant online credit card application form will have a secure area where you complete the form and your personal details will never be seen by any other human while the information is passed through to the issuing company. Are you safer in making a credit card application offline? It is in fact safer to surrender your personal information or even credit card details over the internet than it would be if you were to use the same information offline. But consider the dangers in applying for a credit card offline.

The personal details requested in an online credit card application form are no different than a promotion form you would pick up at your local bank or financial institution. You will invariably post your completed application form to the head office of the credit card issuer or hand it in to the cashier at your bank. Mail can be lost. posted to the wrong address etc. and paperwork can be misplaced in any office situation. Either of these two offline methods is fraught with danger. You can easily tell when you are on a secure webpage because the url address on the page you are visiting will start with' https' as oposed to' http' for an unsecured site. Never give out your personal or credit card details on the internet unless you see the gold padlock and you are sure the site is a secure area. (You might also check if the security certificate is provided by a reputable organisation e. g. Also you should see a gold padlock to the right of the address bar on your browser.

Verisign) . Firstly when you apply online for a credit card the process is quicker and theres a chance you will receive your credit card at an earlier date than if you completed the application form in ink at home and posted it the following day. There are many other advantages in making an instant online credit card application. Secondly, the facilities for comparing credit cards from different companies is so quick and easy on the Internet and would be impractical to make the same comparisons offline. The online facilities make it easier for you to find a low interest rate credit card or indeed find the best credit card deal that suits your personal requirements. It is always useful before you apply online for a credit card, to compare interest rates, reward schemes and annual fees before you make your instant online credit card application. You are also able to contact the credit card issuers by email should you come across any problemss in completing your instant online credit card application form.

So, to sum up, you can apply online for credit card in the knowledge that when you make your instant online credit card application, your privacy is secured and your personal details are passed through the system safely. Typically your email will be answered within a few hours, but some will respond almost immediately. Your new low interest rate credit card could turn out to be the best credit card deal on the Internet! Trevor Taylor

Misleading Gas Credit Card Applications

Category: Finance, Credit.

With gas prices still very high, people want to save some money at the pump.

The average gas rebate credit card can save you up to five percent on gas purchases. Gas rebate credit cards are becoming a very popular alternative. If you' re not careful with your credit card use, a gas station credit card could make you pay more for your gas. Before applying for any credit card, read the terms and conditions. Misleading Gas Credit Card Applications. Most gas credit cards claim high cash back percentages, but there is usually a catch. The credit card companies are very careful with their marketing wording.

Here are some examples: cash rebates limited to one gas station company. high cash rebates only during an introductory period of usually 6 to 12 months. a monthly or annual limit on how much cash back you can earn. a tier structure with varying cash back percentages depending on spending. A cash back percentage is usually quoted as' up to 5% cash back' . So know what you are applying for to prevent disappointment. Once they say' up to' , you know you won' t get that high cash back all the time. Keeping a Balance Will Blow Your Cash Rebates. Over time these interest charges could cost a lot more than any cash rebates you earn. With any credit card, if you only make the minimum payment and keep a balance, you will pay interest charges.

Try to only use your credit card as much as you can afford to pay off next month. Suddenly they are paying for everything with their credit card to earn more cash back. This can be difficult to adjust to for some people. Meanwhile it seems as if their bank account is unaffected. Before they know it, their bank account is empty and a big credit card bill shows up. This could lead to impulsive spending. Then the interest charges add up.

Ideally you should keep track of your credit card spending and keep that much cash aside as money already spent. This is how credit card companies can afford to offer cash back. Gas Rebate Credit Cards Offering Rewards Other Than Cash Back. You could earn airline rewards on your gasoline purchases, but they cost more money in the end. If you are trying to save money with a gas credit card, choose your credit card rewards carefully. Airline rewards would likely only cover a portion of you or your family's airline tickets.

Other gas station reward credit cards offer gift certificates. Then factor in vacation expenses and lost wages. Again it usually only covers part of the purchase and it is something you wouldn' t normally buy. Why Are Gas Rebate Credit Cards Still So Popular? To really save with gas credit cards, apply for a gas credit card that offers cash rebates as checks or statement credit. Gas prices are a major economic factor. The credit card companies are aware of this concern.

We hear about gas price fluctuation in the news. Nearly every gas station company has its own credit card and many of them are heavily marketed. If you spend a lot of money on gasoline, a gas rebate credit card can get you the cheapest gas prices. Despite some reward limitations, many of these gas rebate credit cards are very good deals. A gas rebate credit card used responsibly could save hundreds on dollars off your gas bill each year. Pay off your credit card each month and avoid interest charges.

Ensure you are familiar with your credit card rewards program details though. Compare credit card offers carefully and read the fine print.

The Credit Card Companies Sure Didn' T

I couldn' t believe what I was seeing.

What? I recently reviewed my wife's FICO scores and I nearly fell out of my chair. they suggested she was carrying balances on her credit cards that were too high. It couldn' t be. she never carries a balance on her credit cards. There it was. two of her credit card lenders were reporting her" highest balances" as her credit limits. I knew something was wrong, so I reviewed her credit reports to see what her credit card balances were. Highest balance is defined as: the highest balance you' ve ever had on that specific credit card. You' re overreacting. " I' m not.

The difference between" highest balance" and" credit limit" You may be thinking, "What's the big deal? You see, when lenders do not report your actual credit limits to the credit reporting agencies it can wreak havoc on your FICO credit scores. They should report your account as follows: Credit limit( your real limit) : $5, 000. For instance, let's say the issuer is Capital One� (Crap One, as I like to call them) . Current balance owed: $1, 000. Ideally, it should be lower, but this is certainly not bad. You' re using 20% of your available credit on this credit card.

However, let's say that Capital One reports your highest balance as your credit limit. Balance owed: $1, 000. Assuming$ 1, 000 is your highest balance ever, they may report the account like this: Credit limit: $1, 000. Now it looks like you' re using 100% of your available credit- which is not true. It's as if your son earned five A's and one C in his science class at school- but his final grade is a C because the teacher's policy is to use his lowest grade as the final grade. It's evil, because it will drastically lower your FICO credit scores.

Some lenders don' t report credit limits at all. Why's this bad? Some lenders refuse to report your credit limits. Because when there's nothing in the credit limit field on your credit reports, that account isn' t helping your FICO scores as much as it could. Remember, how much you owe( your balances) versus how much you' re approved for( your credit limits) makes up a large part of your FICO credit scores( see Life After Bankruptcy Issue# 16) . If your credit cards aren' t helping you increase your credit scores, they' re useless to your recovery from bankruptcy.

So if you have high credit limits and low credit usage, that's a good thing. How can credit card issuers get away with these dirty deeds? It will help raise your scores. Some lenders do this out of ignorance( unfortunately, they' re in the minority) . Credit card issuers know that when they don' t report your credit limit accurately it can screw up your credit scores. Most do it to gain a competitive advantage.

In fact, about 5 years ago a disturbing trend started taking place with the top 50 credit card issuers. Soon after, other large credit card issuers jumped on the bandwagon and withheld their customers' credit limits. Two of the largest issuers stopped reporting credit limits to all three credit reporting agencies. After about six months it was more common to see a missing or manipulated credit limit than it was to see an accurate one. Why in the world would credit card companies refuse to report real credit limits when they know it will hurt their customers' FICO scores? It got so bad that Fair Isaac Corporation performed a quick analysis and determined that the practice of not reporting accurate credit limits hurts some consumers' FICO scores. In two words. monetary gain.

The credit card issuers thought they were losing customers to their competitors. In 123 words. Here's an example. When a limit is reported on credit reports, all the other credit card companies can see it. Let's say I have a National City Bank� credit card with a$ 2, 500 credit limit reporting on my credit reports. If Capital One saw that my limit with National City Bank was$ 2, 500, they could then offer me a$ 3, 000 or$ 5, 000 limit to entice me to switch cards.

This is called" poaching. " And the easiest way to prevent poaching was to not report their customers' credit limits. Credit card issuers were stealing business from each other by making their credit limit offers a little better than what you already had. Who cares if it hurts your FICO scores? But I care. The credit card companies sure didn' t. And I know that some credit card issuers still don' t report any credit limit information at all.

So how can you determine if your FICO scores are being damaged? Capital One is the most notorious offender. (Surprised? ) Others just report your highest credit balance as the credit limit. Review your credit reports. If you' re not sure, look at the last statements you received from each of your credit card issuers and write down what the limits should be. Look to see if your credit limits on your credit cards are being reported properly. If they' re not listed on your statements, call the credit card issuers and ask them what your credit limits are. You may ask yourself, "How do I do that? " If you find one of your lenders incorrectly reporting your credit limits, or not reporting anything, here's what to do: Telephone the credit card companies and alert them of the problem and how it affects you.

Then compare them to the limits showing on your credit reports. Ask them to start reporting the accurate credit limits. So the sooner you take action the sooner you' ll see results. Remember, it takes 30 to 60 days for any change to post to your credit reports. On the same day you telephone them, follow up with a written letter( via registered mail) to the person you spoke with on the telephone summarizing the problem in writing and outlining the plan of action they gave you over the phone. If after 45 days you don' t get a response. your next line of defense is to hire an attorney to represent you. Be sure to date the letter and keep a copy.

Hopefully it won' t come to this. but a threatening letter from an attorney can work wonders. Will you take them to court? If the lender refuses to adjust their policy for you, then you have a decision to make. Or will you transfer your balance to a more reputable lender? Here's my take on things. I' m not a big proponent of transferring balances, but this would be a situation where you may have no other choice. The Fair Credit Reporting Act says that any accounts that are inaccurate, misleading, incomplete, unverifiable, or outdated have to be deleted or corrected- or it's a violation of federal law.

This is especially important for people recovering from bankruptcy- it's hard work to increase our credit scores and we need every FICO score point that we earn. I would argue that an account with an inaccurately reported credit limit is not only inaccurate, but is also grossly misleading- especially to FICO credit scoring models. In summary: Make sure you know the reporting policies of all your current lenders, and any lenders you' re thinking of applying with. You should use only lenders that are willing to give full credit for your good credit habits.