Using Your Credit Cards Wisely?

The average American adult carries over $5000 in consumer debt. This fact alone could be why credit cards carry a negative image. Carelessly using your credit cards can significantly damage your financial situation in many ways.

Reckless use of credit cards can leave you with a mountain of debt that will take years to pay off, accruing thousands of dollars in interest, making the money you borrow far more expensive, hindering your other financial goals. Your credit score may be damaged from this as well, making it far more difficult to obtain a mortgage, auto loan and any other type of financing.

Credit cards don’t have to be bad, they can actually drastically improve your financial situation. Learning and understanding the proper use of credit cards helps us avoid piles of consumer debt, and puts them to work for you.

The Basics

Try treating your credit card like a debit card, never use more than you can afford. Know the contents of your bank account so you don’t end up unable to afford  your balance at the end of the month.

Keep your balances low, just because you have a $5,000 credit limit does not mean it should be used. Keep low balances to boost your credit score, and keep your payments manageable.

Make your payments on time every time. Missing payments will result in late fees and can severely damage your credit score. To avoid late payments, set payment reminders for all of your bills. Better yet, if the funds are available, set auto pay on all of your accounts to make the minimum payment, you can always go back and pay more.

Only buy what you need, credit is not free money, so use your debit card or cash as much as possible, and keep your credit card balances low.

Rates

Understand a little credit card terminology to avoid costly mistakes. Annual percentage rate, or APR, is one of the most important terms to know. If you don’t pay the entire balance, your credit card company will charge you the APR on all or part of the remaining balance. If you bought something for $20 last month, it could end up costing you $25. If your card has an APR of 12%, you pay $12 for every $100 you charge if you don’t pay off the balance within the billing period.

You want the lowest APR possible, but don’t be tricked by promotional offers or introductory rates. Some cards offer very low introductory rates for a few months or a year, and increase them later, sometimes drastically.

Minimum Payments

Your credit card statements include a minimum payment amount. These are fluctuating payments depending on your balance. With auto pay, it is always best to select your minimum payments because a certain dollar amount could be more, but it could also be less than the minimum payment, resulting in late fees. Be sure to go back to your bills every month and pay more than the minimum. Minimum payments always appear much more manageable than the balance of your card, however, you must consider interest. Interest accrues on the unpaid portion of the balance and can add up quickly. If you continue to use your card while making minimum payments, you will never catch up and pay off your balance.

Rewards and Points

When you have a rewards card, you gain points for travel, cash back, and other goods or discounts. Sounds great right? However, many of these cards also come with annual fees. Usually you will pay for this fee during your first billing cycle, though some companies will waive the fee for the first year and add it in the second. Read the fine print, and remember not to charge just for points and rewards.

These points are available because of cardholders that use credit irresponsibly. The card companies profit off of the interest charged to those who don’t pay off balances.

The real way to take advantage of rewards and points, is to only charge expenses that you already planned for, and then pay the balances off. The moment you begin to charge more because of rewards is the moment these cards threaten your financial situation.

The Upside

When you charge on your card, the funds don’t immediately come out of your bank account, and you are not down any cash until you need to pay that bill. This can help prevent fraud, theft, and any mistakes that may show up on your statement. If you pay for something with cash, you may or may not be able to get that money back. You are always able to dispute a charge on your credit card statement.

They also provide you with the funds you need in an emergency situation where your bank account doesn’t have enough to get you through to the next paycheck.

Use Your Cards Wisely

There are some great advantages to using your credit cards properly. But be sure not to get out of control or this could lead to financial disaster. Don’t put yourself in a situation where you don’t have enough money to get by, and your credit score will leave you unable to obtain a loan.

Educate yourself, use credit cards responsibly, and track your spending, and credit cards can be a powerful financial tool.

CreditServices.com puts a high value on educating our customers. If you have found yourself unable to obtain the lending options that you desire, we can help. We can help you through the credit repair process and teach you what it will take to manage your credit accounts successfully for the rest of your life.

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Each person’s credit situation is unique. Results may vary, and CreditServices.com makes no guarantee of any particular result. The information in this site is intended for general informational purposes only, and is not to be construed as legal, tax, accounting, or other professional advice.  As such, it should not be used as, or relied upon, as a substitute for seeking professional legal, tax, accounting, or other advice. All information in this site is provided “as-is”, with no guarantee of completeness, accuracy, timeliness, or other results obtained from its use. In no event is CreditServices.com, its Affiliates, or their agents or employees liable to you or anyone else for any decision made or action taken in reliance on the information in this site. “Affiliate” means any entity that directly or indirectly owns or controls, is owned or controlled by, or is under common ownership or common control of the party in question.

When Do Your Balances Report?

It is important to have as long of a credit history as possible, do not cancel credit cards just because they are older. Hold onto them and use them from time to time. Keep the balance low, and make the payments on time. Keeping reporting balances low means you need to know when your balance is reported.

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The balances appearing on your credit reports are usually based on the balance remaining at the end of your billing cycle, not on the payment due date. Go online to make a payment a few days before the end of the billing cycle so the balance reported to the credit bureaus is lower.

This is one tactic we can utilize when building your credit profile. A significant part of the value we offer at CreditServices.com is the education and knowledge that comes with having your own personal credit analyst. We also maintain a database of information that can be put to use when executing your personal Credit Guide. Our advisors know which tactics to use and when to use them, and will coach you throughout the process.

A staggering number of consumers carry high balances on high interest credit cards when they could be saving thousands on interest by keeping balances low and paying before the billing cycle end date. Those credit card users carrying higher balances however, may lack the resources to use this technique just yet. The solution: low-interest rate personal loans. Qualified borrowers are able to get easier access to competitive rates on personal loans for a variety of reasons, including refinancing high interest rate credit card debt.

Don’t Make Any More Mistakes!

You’re trying to build your credit, don’t dig yourself a deeper hole. One of the most common mistakes is making a late payment. Set up auto-pay on your credit cards for the minimum payment so you don’t forget, and make sure to set the payment before your billing cycle end date. You can always pay more, and missing a payment can be devastating.

Personal loans can be a great alternative to credit cards for two key reasons. First, it ends the debilitating cycle of credit card debt, because the loan has a finite term. In contrast, when you transfer credit card debt from one card to another, you have the temptation to keep racking up the charges. The second reason is that it can save you a lot of cash.

Just remember, once you have lowered your credit card balances, you will need to acquire new cards, or continue to use the ones you have. Be certain to use them wisely and pay at the right time to ensure your credit score is in the best possible position.

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Each person’s credit situation is unique. Results may vary, and CreditServices.com makes no guarantee of any particular result. The information in this site is intended for general informational purposes only, and is not to be construed as legal, tax, accounting, or other professional advice.  As such, it should not be used as, or relied upon, as a substitute for seeking professional legal, tax, accounting, or other advice. All information in this site is provided “as-is”, with no guarantee of completeness, accuracy, timeliness, or other results obtained from its use. In no event is CreditServices.com, its Affiliates, or their agents or employees liable to you or anyone else for any decision made or action taken in reliance on the information in this site. “Affiliate” means any entity that directly or indirectly owns or controls, is owned or controlled by, or is under common ownership or common control of the party in question.

Millennials: Build Credit Now

Many millennials saw their parents hit a very rocky financial situation during the Great Recession, creating a fear of credit among the generation. Understanding the difference between credit and debt is the most important aspect of getting over this fear. Credit is a financial tool, that when used correctly can provide you with valuable purchasing power. Debt is a problem caused by the misuse of credit.

millennials credit cards

Using credit wisely is an incredibly important aspect of becoming financially successful now and in the future.

 

Your credit history is everything you have done in the past with regards to using credit. Credit history includes the amount of credit you have used, your payment habits, and if creditors have had to resort to using collections agencies or the legal system to get you to repay your debts.

When considering whether or not to lend you money, a lender will attempt to determine what the odds are that you will repay a debt. Your credit history is the best indicator they have of your credit risk. They assume that you will continue to behave in the future as you have in the past. But if you have no past use of credit, they will view you as risky because they have no record of you being willing and able to manage debt.

After establishing a credit history, you will want to make sure that your reports are reflecting accurate information to ensure that you aren’t being judged unfairly. Lenders look to your credit profile as a record of your credit history and they will likely assume that the accounts listed in your credit reports are accurate. The problem is that very often these items are inaccurate or untimely, misleading, incomplete, unverifiable, biased or unclear.

If your credit reports contain questionable negative items, you have the right to dispute them in an effort to get them corrected or removed entirely. CreditServices.com will help you make sure your profile is reporting accurately, and teach you how to build your credit. We have helped thousands of people with unfair credit reports, and we can help you too!

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Each person’s credit situation is unique. Results may vary, and CreditServices.com makes no guarantee of any particular result. The information in this site is intended for general informational purposes only, and is not to be construed as legal, tax, accounting, or other professional advice.  As such, it should not be used as, or relied upon, as a substitute for seeking professional legal, tax, accounting, or other advice. All information in this site is provided “as-is”, with no guarantee of completeness, accuracy, timeliness, or other results obtained from its use. In no event is CreditServices.com, its Affiliates, or their agents or employees liable to you or anyone else for any decision made or action taken in reliance on the information in this site. “Affiliate” means any entity that directly or indirectly owns or controls, is owned or controlled by, or is under common ownership or common control of the party in question.

Credit Monitoring: The Benefits

Many consumers think credit monitoring services are only necessary for those with a troubled credit history, but that is not the case. In fact, it is just as important to use a credit monitoring service to maintain an excellent credit rating as it is to improve a poor one.

When you sign up for a credit monitoring service, you will receive important information from your major credit reports through Equifax, Experian and TransUnion. You will be able to track all of them and make sure that any information reported is accurate.

In addition to avoiding inaccurate marks on your file, you can figure out where the weak points in your profile exist and improve them going forward. Most credit monitoring services show the major factors in calculating your credit score and grade you on each of them. As a result, you can determine how to adjust your financial approach to improve your credit rating. This will impact your chances of obtaining important financing options like a car or home loan.

Credit Protection

Credit monitoring services can also help protect you from identity theft, which is increasingly important because so much of our information is stored online. Unfortunately, credit card fraud and identity theft are commonplace these days. Cyber criminals are able to hack the databases of major companies obtaining credit card information, so nobody’s information is entirely safe.

Information is power when it comes to improving your personal finances. Monitor your credit use on a regular basis and ensure that your reports are reflecting accurate information. Catching inaccuracies early allows you time to correct them, meaning they are not there to prevent you from being approved!

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Each person’s credit situation is unique. Results may vary, and CreditServices.com makes no guarantee of any particular result. The information in this site is intended for general informational purposes only, and is not to be construed as legal, tax, accounting, or other professional advice.  As such, it should not be used as, or relied upon, as a substitute for seeking professional legal, tax, accounting, or other advice. All information in this site is provided “as-is”, with no guarantee of completeness, accuracy, timeliness, or other results obtained from its use. In no event is CreditServices.com, its Affiliates, or their agents or employees liable to you or anyone else for any decision made or action taken in reliance on the information in this site. “Affiliate” means any entity that directly or indirectly owns or controls, is owned or controlled by, or is under common ownership or common control of the party in question.

Master Credit Card Use: 3 Tips

  1. Pay Mid-Cycle

The balances appearing on your credit reports are usually based on the balance at the end of your billing cycle. Go online to make a payment a few days before the end of the billing cycle so the balance that gets reported to the credit bureaus is lower.

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  1. Avoid Paying Interest

Credit Card users who do not carry balances every month and have signed up with a credit card that offers a grace period have at least 21 days from the time of purchase to pay the charge in full without accruing interest. Grace periods will not be included for balance transfers or cash advances.

  1. Increase Your Limit

Request a higher limit on your credit card to protect your credit rating. Raising the gap between your balance and limit will give you a better credit utilization ratio, which will be favorable for your credit score. Be careful with this tip though, just because the money is available doesn’t mean you should use it, simply use it as a credit building technique.

CreditServices.com credit advisors will walk you through the credit repair process, coaching you on valuable credit building techniques like these. These tips are very effective, and when advised on exactly what time to utilize these tactics in your personal Credit Guide, you will see the best results. That is why we are here, we are specialists in credit repair, and we can help you!

See what our customers have to say about us and then contact us for a free consultation today!

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Each person’s credit situation is unique. Results may vary, and CreditServices.com makes no guarantee of any particular result. The information in this site is intended for general informational purposes only, and is not to be construed as legal, tax, accounting, or other professional advice.  As such, it should not be used as, or relied upon, as a substitute for seeking professional legal, tax, accounting, or other advice. All information in this site is provided “as-is”, with no guarantee of completeness, accuracy, timeliness, or other results obtained from its use. In no event is CreditServices.com, its Affiliates, or their agents or employees liable to you or anyone else for any decision made or action taken in reliance on the information in this site. “Affiliate” means any entity that directly or indirectly owns or controls, is owned or controlled by, or is under common ownership or common control of the party in question.

Simple Credit Building Technique

It can be difficult to build credit once you have a negative credit history. Most banks won’t approve you for a loan, and creditors don’t want to give you a credit card because you are “high risk”.

One way to begin building your credit is by obtaining a secured credit card. Secured cards require a deposit, usually around $200-$300 to open. This deposit will act as your credit limit, and is a form of insurance for the bank, knowing that they at least have that amount of money in case you go delinquent on the account.

Once you have your secured card, you will need to keep your balance low to maximize the credit building power. Set your card to take auto payments from a debit account so that you will not have to think about it, and won’t risk any late payments, lowering your score even more. This tactic will build your profile in two ways: payment history, and balance to limit ratio.

This is one of many tactics that we can use to guide you to your Path To Credit Recovery. CreditServices.com is here to help motivated individuals put their bad credit in the past and get their purchasing power back!

Get motivated, set your goals, and take action!

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Each person’s credit situation is unique. Results may vary, and CreditServices.com makes no guarantee of any particular result. The information in this site is intended for general informational purposes only, and is not to be construed as legal, tax, accounting, or other professional advice.  As such, it should not be used as, or relied upon, as a substitute for seeking professional legal, tax, accounting, or other advice. All information in this site is provided “as-is”, with no guarantee of completeness, accuracy, timeliness, or other results obtained from its use. In no event is CreditServices.com, its Affiliates, or their agents or employees liable to you or anyone else for any decision made or action taken in reliance on the information in this site. “Affiliate” means any entity that directly or indirectly owns or controls, is owned or controlled by, or is under common ownership or common control of the party in question.

Avoid These Common Credit Card Mistakes

  1. Getting too many credit cards:

While having a good debt-available credit ratio will build your credit and look favorable to lenders, if you have too much available credit, a lender may think: “What if they decide to max out all of these cards, what would the debt-income ratio be?” Not to mention that multiple credit inquiries will lower your credit score and may lead a lender to believe you are desperate for more money.

  1. Paying your bill late:

Not only will you face a late payment charge that may be higher than your minimum payment, this will show up on your credit report and lower your credit score.

  1. Ignoring your monthly statement:

Avoid late payments by checking your monthly credit card statements. Checking your monthly credit card statements will also allow you to make sure charges are correct, and catch identity theft, if you wait too long it may show up on your credit report.

  1. Exceeding your credit limit:

If you are approaching the top of your credit limit, try to use cash for subsequent purchases. If you don’t, your purchase may be rejected, unless you have authorized your card company to charge hefty over-the-limit fees.

  1. Misunderstanding introductory rates:

With introductory rates, often offered on big-ticket items, interest accumulates from the day of purchase. If you don’t pay off the debt during the introductory period, the interest will be charged retroactively, more than likely at a very high rate.

 

These are common mistakes made with credit cards that can damage your credit and hinder your ability to qualify for lending opportunities. The more you can learn about the terms of the credit cards you utilize, and credit card use in general, the better you will be able to manage your debt and position yourself for a strong credit score and financial life!

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Each person’s credit situation is unique. Results may vary, and CreditServices.com makes no guarantee of any particular result. The information in this site is intended for general informational purposes only, and is not to be construed as legal, tax, accounting, or other professional advice.  As such, it should not be used as, or relied upon, as a substitute for seeking professional legal, tax, accounting, or other advice. All information in this site is provided “as-is”, with no guarantee of completeness, accuracy, timeliness, or other results obtained from its use. In no event is CreditServices.com, its Affiliates, or their agents or employees liable to you or anyone else for any decision made or action taken in reliance on the information in this site. “Affiliate” means any entity that directly or indirectly owns or controls, is owned or controlled by, or is under common ownership or common control of the party in question.

Our Offering

CreditServices.com™ Service Levels have one of the Nation’s highest success rates among Credit Service Organizations. Specific services include validation through our meticulous bureau discovery process, credit rebuilding strategies and options, credit education on profile management, coaching on the FICO™ and Consumer scoring formulas, and continued support with advising and consulting throughout your specific credit service process.

We are an award winning consumer-oriented company and love to deliver the results that our clients deserve! Whether your goal is obtaining a mortgage, auto loan, or general credit improvement for purchasing power, we have a program for you.

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Each person’s credit situation is unique. Results may vary, and CreditServices.com makes no guarantee of any particular result. The information in this site is intended for general informational purposes only, and is not to be construed as legal, tax, accounting, or other professional advice.  As such, it should not be used as, or relied upon, as a substitute for seeking professional legal, tax, accounting, or other advice. All information in this site is provided “as-is”, with no guarantee of completeness, accuracy, timeliness, or other results obtained from its use. In no event is CreditServices.com, its Affiliates, or their agents or employees liable to you or anyone else for any decision made or action taken in reliance on the information in this site. “Affiliate” means any entity that directly or indirectly owns or controls, is owned or controlled by, or is under common ownership or common control of the party in question.

Low Rates, Can You Take Advantage?

The interest rate you agree on for a mortgage heavily influences the affordability of your home. Half of a percentage point higher could make a difference in monthly payments and whether you will have enough money left over for your other financial goals, such as paying off debt. Since interest rates have been hovering around historic lows, applicants can lock down a low rate before they begin to rise.

However, if your credit score is low, it may make sense to raise your credit standing before applying for a mortgage. Borrowers who have high credit scores are more likely to get the lowest mortgage rates, which could save them thousands in interest payments over the life of the loan.

CreditServices.com can get your credit in a position to receive great interest rates and save you thousands on your home!

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Each person’s credit situation is unique. Results may vary, and CreditServices.com makes no guarantee of any particular result. The information in this site is intended for general informational purposes only, and is not to be construed as legal, tax, accounting, or other professional advice.  As such, it should not be used as, or relied upon, as a substitute for seeking professional legal, tax, accounting, or other advice. All information in this site is provided “as-is”, with no guarantee of completeness, accuracy, timeliness, or other results obtained from its use. In no event is CreditServices.com, its Affiliates, or their agents or employees liable to you or anyone else for any decision made or action taken in reliance on the information in this site. “Affiliate” means any entity that directly or indirectly owns or controls, is owned or controlled by, or is under common ownership or common control of the party in question.

Make Credit Work For You!

Is your current credit situation helping or hurting your progress toward financial goals?

Credit is used by lenders, employers, landlords, and insurance companies to assess the risk you present to them. If you have good credit, you will likely be approved to borrow the things you want or need, and at great interest rates. If you have poor credit however, your chances of being denied for lending options is much higher, and you will certainly pay higher interest rates.

Because credit impacts so many aspects of our lives, bad credit is one of the most detrimental labels a person can be assigned in today’s credit driven society. Unfortunately for many people, their bad credit label is undeserved.

Take your power back! You are more than a credit score. A couple of mistakes or hardships can bring your score down for years. Take action for yourself now and for your future. Putting bad credit on the back burner means keeping your financial goals on the back burner.

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Each person’s credit situation is unique. Results may vary, and CreditServices.com makes no guarantee of any particular result. The information in this site is intended for general informational purposes only, and is not to be construed as legal, tax, accounting, or other professional advice.  As such, it should not be used as, or relied upon, as a substitute for seeking professional legal, tax, accounting, or other advice. All information in this site is provided “as-is”, with no guarantee of completeness, accuracy, timeliness, or other results obtained from its use. In no event is CreditServices.com, its Affiliates, or their agents or employees liable to you or anyone else for any decision made or action taken in reliance on the information in this site. “Affiliate” means any entity that directly or indirectly owns or controls, is owned or controlled by, or is under common ownership or common control of the party in question.