Category Archives: Bad Credit

Can I get a Credit Card with Bad Credit?

Introduction

The recent economic crisis has affected the British taxpayer in a number of ways. Many have seen their disposable income dwindle, whereas others have been forced to cancel subscriptions and memberships in a hope to soften the blow of the increased cost of living.

Credit cards

Credit cards

Credit Crunch vs. Credit History

One aspect of people’s finances that has been indirectly affected by the recession is their credit history. This is because; when money is tight, any unexpected expenses such as car breakdowns or boiler call-outs can break the budget and force important bills to go unpaid. When this happens, the provider will often give you a few days to recover the arrears on the account prior to reporting a missed payment to credit reference agencies. If, you are still unable to pay having received notification from the provider, this will then be reported to credit reference agencies as a missed payment which will ultimately have a negative effect on your credit score.

Getting Approved for Credit

Having a poor credit score will affect your chances of being approved for credit in the future; it will also mean that you’re likely to have to pay over the odds for your credit. This is because lenders (both credit card and loan lenders) work on a risk-assessed basis, therefore if they are lending to high credit risk customers (those with bad credit) – the rates they offer have to be higher, if they are lending to low credit risk customer (those with good credit) the rates offered will be lower.

In order to recover their credit history, many look to apply for credit cards. However they are often left confused when presented with the sheer range of credit cards on offer these days. Low rate, foreign usage, reward points, cashback cards, 0% purchase and 0% balance transfer are just a few of the terms that you are likely to be confronted with when in search of credit cards.

Bad credit

Bad credit

The Credit Builder Credit Card

However, when you have a poor credit history, there is only one credit card you should really be looking at and this is the ‘credit builder’. These are readily available from a range of providers who specialise in offering credit to those who have been refused elsewhere.

These cards will come with higher rates of interest; however they will help to improve your credit history providing you manage them immaculately. One way of avoiding these high interest rates is to pay the full balance off at the end of the month

Conclusion

So the simple answer is; yes, you can get a credit card with bad credit. The only problem is; you will have to pay higher rates for the privilege. However, if you can prove you are able to manage the credit, and never miss payments or exceed the credit limit – it will go a long way to improving your credit history.

This article has been written by Jason Scott on behalf of Guarantor Loans Online.

Charged off account-Ways of fixing bad credit

charge off account

charge off account

There are times when creditors are not successful to collect the past debts from the consumers even after trying several times. In such an occasion, they will consider the debt as charge-off and hence they will stop all collection efforts. After a long time, you will find that some junk debt buyer or a collection agency is contacting you for the same account. This happens because creditors oftentimes sell the charge-off account to collection agencies and junk debt buyers for pennies on the dollar. These collection agencies will later contact the debtor for the same debt by adding on outrageous interests and fees.

Collection agencies have their own strategies of collecting debts from the consumers. It is important that you check the statute of limitations in your state before you start dealing with the collection agencies. If you find out that the statute of limitations of your state has expired for the said debt, then you can send a dispute letter to the collection agency informing them about the expiry of the SOL. This will stop them from taking any legal actions against you.

bad credit repair

bad credit repair

If the charged off debt is more than seven years old, then it has to be automatically removed from your credit report as per the Fair Credit Reporting Act. If you see a past debt showing up on your credit report that is more than seven years old, contact the credit bureau that is reporting this negative item and they will remove it. Once the negative item is removed off your credit report, the collection agency cannot put it back on your report. Just in case, if the collection agency is contacting you for the same debt even after it is removed from your credit report, then you can take strict legal actions against them.

Many people believe that paying off a debt to the collection agency will remove the charge-off status from their credit report. This is not true. Even through the debt is too old and is past the statute of limitations, if you consider paying it back, it will show as paid and the charge-off status will still remain on your credit report. At least, its still better than not paying it back.

Helpful Article:

http://www.consumer.ftc.gov/articles/0058-credit-repair-how-help-yourself

How to fix bad credit?

People with bad credit often face difficulties in every phase of life when they are looking for any new credit from potential lenders. There are ways to improve the credit ratings and you need to take positive actions and change your attitude towards money. Here are some good tips on the road to debt recovery.

The first thing that you need to do is to order a latest credit report from the credit bureau. Look for any inaccurate items on your credit copy and get it fixed immediately with the credit grantor or the credit bureau. You need to take immediate actions because inaccurate items reported on your file are one of the reasons of your lower credit scores and your potential to get new credit.

If your credit scores are getting hurt because of the accurate negative items, then you must contact the creditor and work out payment arrangements with them. It will be a good move to pay off those debts that are catching the highest interest rates.

If you are overwhelmed because of your existing debts, contact a non profit credit counseling organization to work out a debt consolidation plan. A debt counselor will contact your creditors and negotiate with them to reduce the existing interest rates. This can reduce your monthly payments by up to 40%.

Stay away from any credit repair services or company offering you debt consolidation loans. These companies will put you deeper into debts. There are many companies that will advertise credit repair packages on the internet, TV or radio or send unsolicited mails or emails.

You don’t need to keep those credit cards active that have not been used for a long time. It will be a good idea to sell some valuables or liquidate assets and use the money to repay the existing debts. You must follow a very tough budgeting so that you can save more money and use it towards paying your existing debts.

Consult your debt counselor and get all the existing debts paid off. Pay the rent and utility bills in time and be regular in your mortgage and car payments. This will definitely build up your credit scores and your car and home will remain safe.

Once you have paid off your existing debts, apply for a secured or an unsecured credit card and make timely payments. You may also apply for a department store or a gasoline credit card. This will definitely improve your credit ratings.

Use your credit card responsibly and pay the bills in time.

Bad credit student loan options

Education costs are increasing every year and students have to go through a lot of expenses that often go unmet. Students with bad credit often wonder how to get qualified for student loans to complete their education. There are many better ways to receive bad credit student loans that can help you pay for everything.

Money above student aid: There are many government aids and many students will often qualify for it. Government student aid is a better form to cover the bare essentials of attending the college or university of your choice. Stafford or Perkin loans are available but they have a strict borrowing limits on the basis of the number of college hours you have under your belt.

A private student loan can help you in paying your tuition, housing, book expenses and many other expenses. You may engage in some part time jobs to have an extra income and in order to repay back the loans while you are pursuing your studies and thereby improving your grades. You will have to undergo a credit check in order to get approved for a private student loan, but most often you will get qualified for these loans.

In order to increases your chances of getting approved for the private student loans, it is a good idea to apply for the loan with a co-signor, especially someone who has a better credit than yours. You can apply for the loan with your parents, or your family members and friends. The lender will look into the credit history of the co-signor so that your chances of getting approved for the loan become much easier.

When you are deciding for the loan amount, make sure that you borrow that much to cover your semester or academic year. Private student loans for bad credit will be disbursed all at once which means that the loan is meant to last you for the entire semester or the academic year.

You may apply for these loans online at better interest rates. Traditional lenders often charge higher interest rates. The online lenders have more capital to offer and the money can be transferred to your checking or savings account within the earliest possible time.

Tips for cleaning bad credit

If you are having a bad credit, then you need to do a lot of hard work in order to fix it. It is important that you stay on top of your bad credit because it plays a significant role on your financial future. You will face a lot of troubles in obtaining any new credit from the future lenders. Here are some tips on how you can fix your bad credit over the period of time.

The first step that you need to take is to order a free copy of your credit report from the credit reporting agencies. You are eligible to receive one free copy of your credit report in a year. If you pull your credit report multiple times in a year, it will hurt your credit scores.

 


Next step is to review your credit report thoroughly. You want to make sure that there are no incorrect items reported on your credit report that are hurting your scores. If you find any errors, contact the credit reporting agency and dispute the incorrect item. Get it fixed immediately. Make sure that you are doing the disputing the error in writing in order to back your case. The credit bureau will review your dispute and correct it within thirty days.

Take a look at the loans and the credit card debts showing on your credit report. Close those accounts that you won’t need in the future because too many open accounts will hurt your credit scores. Transfer the credit card balance having a high interest rate to another card with a lower interest rate as this will save you some money in the long run. If there are any open accounts with small balances on your credit report, contact the creditor and get it paid off before you start working on the accounts with larger balances.

Contact the creditors with whom you have high balances and try to work out payment arrangements with them. They will be willing to work on your payment terms because they will understand your intentions of paying off your debts in order to fix your credit. Make sure that you get everything in writing before you agree to make any payments.

Repairing your bad credit will take some time, but this is something that you will want to do in order to get a good deal from the potential lenders when you are looking for any new credit in the future.

Home loans for people with bad credit

People with bad credit often get disheartened when they are not approved for any kind of home loans from any reputed financial institutions or lenders. There are ways by which you should be able to get home loans from any reputable financial institution just like any other person with a good credit history.


Find out a good deal: Finding a good deal on real estate can be quite a challenging task, and if you get one, it will be very rewarding, especially for someone with a bad credit history. When you purchase a home at a cheap price and get equity in the property, the loan officer will consider your bad credit home loan as a partially secured loan. Talk to a mortgage broker to know how these kinds of transactions will help you in getting approved for a home loan.

Investigate creative financing:
You need to be a little creative when you are shopping for a bad credit home loan. There are a variety of ways by which you can get approved for a bad credit home loan. Adjustable Rate Mortgage is one of the common ways by which people get approved for a home loan because their interest rates are quite low. Another way to get approved for a home loan is to involve the seller when you are applying for the loan. The seller can cover most part of the down payment on purchase. Or you can ask the seller to carry back a second mortgage that you repay back to them at a very low interest rate. These creative techniques will help you get an extra $10,000 while applying for the loan with bad credit.

Always believe in a down payment:
prefer to make a down payment of at least 3% – 5% of the loan amount. Of course, the more you can put in a down payment, you will be paying less in interests on the remaining balance. A drop of 2% in the interest rate on a $150,000 loan can save you over $72,000 in interest over the course of a 30 year loan. Plus you borrow a less amount in financing. If required, wait for some months so that you can build up more funds to make a down payment to the loan company.

Shop around with different companies:
always shop with different lenders while you are applying for a home loan. The interests and fees may vary with different lenders. The mortgage brokers will try to convince you that their skill and experience in the market has helped many people in need of home loans and they are going to help you too. Don’t be carried away by their words if they say that no one else is going to offer you a better deal than them, especially when you are having bad credit. Browse through the internet and you will find so many lenders in your area offering lucrative deals. An online mortgage specialist is often the best person to contact to get home loans for people with bad credit.

Improve your credit scores:
While your credit is already bad, you may find out different ways to boost up your credit ratings. Review your latest credit report and go through all the items reported on your copy. You may find out some inaccurate items on your file that should be immediately disputed. Once the incorrect items are removed from your credit report, your credit scores will go up. Then you can contact the other creditors to whom you owe a balance and work out payment arrangements.

Bad credit doesn’t have to stop you from getting a mortgage even if it does make it more expensive. Home loans for people with bad credit are available from a variety of lenders who specialize in bad credit home loans. They can make it easy for you to finance your perfect home.

Business loans for people with bad credit

People with bad credit can now get approved for business loans. These kinds of loans are not processed through the usual banking circles. They require a different kind of collateral such as account receivable collaterals. When you look for a loan with a bank, they want their customers to have an excellent credit and require collateral. If you want to start a business and your credit got screwed because of late payments, skipped payments, or a bankruptcy, then you should not go to a bank for loans. When loans are issued to borrowers, they will look into the future sales. And to get an idea, they will look into the past sales of your business. If your past credit history has not been good enough, then most of the banks will not approve your loan application.

When a lender is granting funds to the borrower, they will offer some financial assistance in the form of advice so that he does not have to go through any kind of financial crisis in the future. There are many lenders that will try to scam the borrowers by saying that they will remove negative information from their credit report. They advertise that they can remove judgments, bankruptcies, late payments, tax liens, collections, foreclosures and repossessions along with their offer of poor credit lending. When you are applying for any business loan, you should check the legitimacy of the loan company. There are many genuine loan companies who offer help to people with bad credit so that they can get back to their feet.

Nowadays, many lenders and financial institutions know that an individual’s financial situation can get worse anytime because of unexpected losses in the business, family emergency or any other unavoidable reasons. The possibility of poor credit lending is increased in the past few years. There was a time when business loans for people with bad credit were denied. Earlier, if anyone faced a loss in the business, he had to look towards private sources or his personal savings. The small business administration, libraries and bookstores offer guidelines for good business practices so that critical financial difficulties can be avoided.