A lot has been written in the past few years about the importance of both credit reports and credit scores. The credit report is a listing of all significant financial transactions by a consumer and whether or not those transactions were completed on time and as agreed. The score is a distillation of everything contained on the credit report, boiled down to a three-digit number. That number is supposed to indicate to a creditor or a lender, at a glance, whether or not the consumer in question is worthy of another loan.

Until recently, the three major credit bureaus, Experian, Trans Union and Equifax, all used different but similar systems to devise the credit score, which ranged from 300 at the low end to 850 at the high end. The different systems meant that a consumer checking his or her score with each of the credit bureaus would receive three different credit scores. This led to some confusion as to which score was the “correct” one. The bureaus have recently attempted to solve that problem by creating VantageScore, a unified scoring system that all three bureaus will use. This should result in a consumer receiving the same score no matter which bureau provides it.

But this hasn’t entirely stopped the confusion over credit scoring. Unlike the old systems 300-850 range, the VantageScore uses a different scale that ranges from 501-990. In addition to the numeric score, the VantageScore system will also provide a letter grade, ranging from A-F, as follows:

901-990 – A
801-900 – B
701-800 – C
601-700 – D
501-600 – F

Now the source of the confusion has changed. Many people have erroneously assumed that a score in the old system will be transferred to the new system. That means, to their way of thinking, that a top score in the high 700s or low 80s under the old system is now merely “average” under the new one. How, people are wondering, did a top score suddenly become mediocre?

The answer, of course, is that it didn’t and that comparisons between the old system and the new one are like comparing apples with oranges. The new system is completely different and will use a new set of criteria to create the new score from the ground up. A score in the 800 range under the old system will almost certainly become a score in the 900 range under the new one. Consumers have no reason to be alarmed, and in time, the new system will be better and more easily understood than the old one. After all, nothing tells you that you have done well better than being told that you have received an “A”.

Online Credit Repair Avail of Free Services to Help You

If you want online credit repair, there are many services online that will guide you through the process of repairing your own credit record for free. Bad credit does not have to be with you forever and you can take steps now to repair your own credit record. There is no need to pay out hundreds or thousands of dollars to get the help you need. By searching for online credit repair, you will find a wealth of information to help you. Credit repair online is very achievable.

If you do decide that you need help, read the information available online. Credit repair is something that will take time so you shouldnt expect it to happen overnight. You can start by consolidating your bills with one debt reduction loan. Contact your bank or lending institution. These organizations have credit counsellors who will help you with bad credit repair.

The counsellor will help you determine the amount of money you need to borrow to pay off your bills. If you have many bills, then you can choose the ones with the highest monthly payments, leaving you with a manageable monthly payment. With online credit repair, there are many ways you can find counsellors to help you without going through your bank, but these will charge a fee for the services. You dont need to waste any more money by paying unnecessary charges to help you with bad credit repair. Online credit repair is like any credit repair, its a matter of finding the right resources.

The main thing with bad credit repair is to make a conscientious effort to pay your bills on time. If possible, pay a little more than the minimum monthly payment. This not only helps to repair your bad credit, but gets the bills paid off earlier because you reduce the amount of interest charged on your account. Online credit repair help is available from all of the credit bureaus and there are even guidebooks online to help you with every step of the process.

One of the suggestions you will get from an online credit repair service is that you should pay as much as possible on your bills that have the highest amount of interest. If you are paying off a credit card, instead of putting money in the bank to have in case of an emergency, pay it on the credit card instead. This way if you need extra money, you still have the card to use. Tips for bad credit repair from online credit repair sources will also tell you that you can have a prepaid credit card so that when you spend any money, it will not put your further in debt.

Online credit repair can work very well, if you find the right resources.

Five Credit Card Billing Problems and How to Fix Them

It goes without saying that your first and best defense against paying fraudulent or unfair charges on your credit card is knowing what your bill says! When you receive your credit card statement each month, sit down with it and check each item to make sure that you actually DID purchase it. If you do run into inaccuracies or problems, there are procedures to follow to report and deal with the charges. If you don’t follow the procedure and the card company decides to notify a credit reporting agency, it could affect far more than just your balance on that one credit card.

What are the most common billing problems and how should you deal with them?

1.Hey, I didn’t buy that!

If you notice a charge on your credit card statement that you didn’t make, take steps to deal with it IMMEDIATELY. It could be a store error – but it could be the first sign that someone else is using your identity. Heading off problems before they start is vital. Call your credit card company and report the charge that’s in error – but don’t leave it at that. Follow up with a written letter stating that you dispute the charge, and requesting that they investigate the situation. The credit card company has 45-60 days to complete their investigation and notify you of the result. During that time, they can not make any attempts to collect that amount from you, nor report you to a credit reporting agency because of it.

2.Wait – I canceled that subscription!

If you cancel a subscription for which you pay via credit card – to a magazine, a club or internet service provider for instance – it may take a month or two for the cancellation and ‘chargeback’ to show up on your credit card statement. Again, notify the credit card company that that account has been canceled and request that the charge be removed from the bill.

3.My bill just doesn’t add up right!

They’re rare, but mathematical and reporting mistakes do happen. If you notice a discrepancy on your bill between their reports and your receipts, write a letter to the credit card company – being sure to use the address for reporting credit card disputes. Include copies of both the bill and your receipts for the disputed charges.

4.I returned that dress!

Like a canceled subscription, it sometimes takes a billing cycle or two for charge-backs on returned items to appear on your credit card bill. Write to the credit card company and enclose copies of your return receipt, asking that the charge be removed from your bill.

5.What do you mean, there’s a late fee??

Your best defense against late fees is to make sure you send your payment in plenty of time to reach the credit card company by posting date. Keep in mind that credit card companies date payments by date received and/or posted, not by date mailed. Because of the effect a late payment can have on your credit card billing and your credit history, though, it’s sometimes worth a try to get them to ‘take it back’. If you have evidence along the lines of a check cleared to your bank account before the payment was posted to your account – and it’s before the late payment date, you can write to the credit card company and ask for a review of the charges.

If you have reached the maximum limit on your credit card, along with payments due for a car loan, personal loan and house payment, rest assured, youre not the only one drowning in the sea of debt.

With this overpowering impact of consumer goods, everyone finds themselves deep down in debts or prone to it. Many people cant even recollect where they have managed to spend all their money. The minimum payments on your loans only cause further distress and are not assisting you to get out of debt. A debt consolidation loan is a recommended solution to fix your current financial disarray.

A debt consolidation loan pays off many loans or lines of credit. The key to debt consolidation is attaining a low interest rate to help you pay off all your debts faster. This will help you save thousands of dollars which you would needlessly be paying in interest over a prolonged period. The time frame to get out of debt through debt consolidation finance varies greatly and depends on the amount of debt and the kind of debt.

The average length of time to get out of debt is 4 years or less. Strive to pay off high interest debts first; then work on every other debt according to interest rates being charged. The key is to pay less interest overall, leaving more money to pay off principle.

Once all the high interest debt is paid off through debt consolidation then you must control your expenses and chart out a budget, which will plan your income and expenses well.

Less debt and lower interest rates ensure that you pay off faster and save money. When your creditors realize that you’ve signed up for a debt consolidation plan, they acknowledge your effort to pay off your debt and may be willing to offer more favorable terms, making it easier for you to repay them. Also, making one payment is much easier than figuring out who should get paid how much and when. This makes managing your finances much easier. Hence, debt consolidation is considered as one of the best financial tools if a person needs to get out of debt.

However, you must watch out for the trap of getting sucked into further debt: With an easier load to bear and more money left over at the end of each month, you may easily be tempted to start using your credit cards again renewing your uncontrolled spending habits which got you into such debt in the first place.

Also, remember that you can lose everything. Debt consolidation loans are secured loans. If you do not pay the loan, they will take away whatever secured the loan. In most cases, this will be your roof.
Before you decide to enter a debt consolidation plan, carefully weigh its pros and cons in a realistic manner to determine if this is the right decision for you. While trying to get out of debt, the last thing you want to do is to make the problem worse than it was.

Credit Repair Services

If you are in the business of credit repair services. You may have at one time considered purchasing credit repair leads.

The benefit of purchasing credit repair leads, is that the customer is committed to having their credit repaired by a professional such as yourself.

These customers are not playing games or surfing the net looking for information and merely contemplating the idea of credit repair, they are very serious about it, and they are waiting on a phone call.

Wether or not you are an established credit repair business or a start up, credit repair leads are a good option when considering lead sources.

So where is the best place to get credit repair leads?

The obvious answer would be to find a credit repair lead company, but that isnt always as easy as it sounds.

Yes, it is easy to find the lead company via the internet, but finding a good one with reasonable pricing is where the challenge lies.

For starters, find a lead company that obtains their leads through web sites they own and operate themselves.

Steer clear of the companies that buy their leads from other companies and recycle them. You never know how many times that selling company has sold the lead.

Try to find a company that not only sells their own leads, but sells them at a reasonable price, exclusively, and in real time if possible.

Make an attempt to contact someone in their customer service department. Ask them as many questions you feel to be appropriate. If you are not satisfied with the answers to your questions, or the quality of the service you receive, than move onto the next company.

The quality of the service you receive is usually an indication of the quality of the lead you receive, so proceed with caution.

Back in June FICO announced they would be rolling out a new formula for calculating their credit score used by all three major reporting services. This updated product would no longer consider an authorized user account as a valid card holder and any credit information about the authorized user would be dropped. This seemingly minor change is expected to affect over 30 million US cardholders, inducing a small to moderate drop in their credit scores.

Now Capital One has announced they will start, for the first time, reporting the credit limits of their card holder accounts. But how does this affect you?

This recent policy change by Capital One may alter the credit scores of some cardholders. Since FICO bases around 30% of their score on credit-to-debt ratio, having accurate credit limit data available will make their scoring product more accurate. The real impact though will be mostly unknown until the changes are made and have had a chance to work through the FICO system and roll out to the credit reporting agencies.

Currently only Capital One and American Express withhold credit limit information when reporting account data to FICO. The effect of these policies is widely disputed. Some argue that not having the credit limit amount available causes FICO to arbitrarily assign the outstanding balance as the credit limit. This would cause all AMEX and Capital One account holders to appear as though there cards were always “Maxed Out” or at their limits, a condition likely to severely harm one’s credit score. They also believe that when Capital One starts reporting the credit limits, their account holders will enjoy a miraculous increase in their FICO score and consequential reduction in interest charges.

This writer believes otherwise.

Fair Isaac Corporation (FICO) has been in the business of evaluating consumer credit-worthiness for over 50 years and employs nearly 3000 people. FICO credit information is used by 99 of the top 100 US banks to base the decisions of billions of dollars each year. The method for determining a FICO score is not a clear cut, simple formula. It is a large, dynamic algorithm that FICO stakes their reputation and future on. It is also adaptive, predictive and a closely guarded trade secret. I, personally, am convinced that FICO handles Capital One and American Express data correctly and estimates an accurate credit limit. This is further substantiated by the fact that American Express customers do not suffer undue harm by the AMEX policy of not reporting limits. In fact, having an AMEX card can be a major boost to your credit score.

Lets look at just one small example of how a credit limit can be estimated. Suppose four months ago you used your Capital One card to purchase a new 60 plasma TV for $3000 dollars. FICO would see this transaction and apply a credit limit of at least $3000 to your account. The actual limit would probably be some percentage higher based on the likelihood that you did not max the card out. This limit would remain on the account, maybe fluctuating with your general credit score and current financial situation. Do not forget that FICO has access to a very large amount of data over a very long period of time.

When the smoke clears from this latest reporting change, the scores of most Capital One customers will likely remain about the same. Some will go up a little and some will drop slightly. Perhaps a more interesting discovery will be to see just how well FICO has been doing in estimating the credit limits of these two companies account holders.

All You Need To Know About Non Homeowner Debt Consolidation Loans

Until recently, the process of debt consolidation was only available to the people who were homeowners or who were in possession of assets, which could be offered to the lenders. That however, has changed with the arrival of the non homeowner debt consolidation loans.

These non-homeowner debt consolidation loans provide the same function to the non homeowners that debt consolidation does to all the other borrowers.

Debt consolidation It is a process by which the people who owe multiple debts clear off their debts by taking another loan that would cover for all the previously owed debts. The process begins by taking loan from a lender, who deals with such debts.

People many a times wonder as to how a loan much bigger in size, will help the borrowers who may already be struggling with the burden of debts. That my friends, is possible with the way the loan and its working is structured. The loan is featured as such that it will only aid the borrower in every step of the debt consolidation process

The benefits that a borrower stands to get with the non homeowner debt consolidation loans are:

The loan is an unsecured loan and this eliminates a lot of the risk that may have been associated with a secured loan.

The loan gives the non-homeowners a chance to restart their payments by taking over all their previously accumulated debts.

Also the interest rate is lower than the average interest rate of all the previously accumulated debts. This feature subsequently helps in lowering the monthly installments to be paid.

The borrower now has to face only a single lender, which is theoretically easier than being answerable to a number of creditors.

People with bad credit history get a chance to improve on their credit score by following the guidelines given by their new lenders. This in future can help in getting easier loan terms.

With these benefits and features, the borrowers get all that they desire as far as their loans are concerned.

Borrowers however, have to be careful in their dealings as this loan may not carry any threats to your assets, but still failure to pay the required or agreed installments could be hazardous to both the credit score of the borrower. Harsh fines and sanctions could also follow this. Though, that is an extreme case but still prevention is better than cure.

Cash back credit cards provide fantastic opportunities for those that carry them. For every purchase a cardholder makes with one of these cards, money rebates are earned. This makes cash back cards potentially profitable for those that take the time to choose the best cash back credit cards and who use them properly. When looking for the best cash back credit cards, it is important to take several things under consideration.

One area to consider when searching for the best cash back credit cards is the percentage of rewards provided. Most cash back cards provide cardholders a cash rebate according to a percentage of the amount charged to the card. Obviously, the higher the percentage, the greater amount of money that can be earned. So, when looking for a cash back credit card, the consumer should, most obviously, opt for one with greatest rate of return.

Most cash back credit cards are partnered with certain businesses. For example, a cardholder may receive a 1% rate of return on general purchases, but a 5% rate if purchases are made at a certain gas station. Therefore, it is important for consumers to choose a cash rebate card that provides special incentives with businesses or services the consumer uses frequently. It certainly wouldn’t make much sense for a consumer to use a cash back credit card providing a special 5% rate for purchases made at a restaurant if the consumer never dines out!

The APR of the cash back credit card also needs to be taken under consideration. Many cash back credit cards tend to have a higher APR than those without special rewards programs. The consumer must be aware of the APR of the card in order to determine if the ultimate finance charges will be more or less than the rewards earned. If the finance charges will cost the consumer more than the rewards he or she will earn, then the card is not truly earning the consumer money. Those that pay their balance off in full each month obviously do not need to be concerned with the APR.

Just as the APR must be considered when looking for the best cash back credit card, it is also important to look at the annual associated with the card. A cash rebate card with an annual fee may not be worthwhile in the long run. Therefore, the cardholder needs to be sure that he or she will earn enough cash back during the year to make the annual fee worth paying for.

Not all cash back credit cards work in the same way. Some send money to the cardholder once per year. Yet others credit the account. Still other cash back credit cards place the money in interest earning accounts or in special college savings accounts. With some credit cards, the points toward cash back earnings are calculated and sent to the cardholder automatically. Still others require the cardholder to request the refund once he or she has accumulated enough points. All of these need to be taken into consideration when determining which card is best.

Some cash rebate cards have limitations to how many cash back rebates can be earned per year. For some cardholders, this is not an issue because the limit is much higher than they will ever spend. For others, this cap can be a concern. In addition, some cash back credit cards place an expiration date on how long the rebates are good. Therefore, those that think they may not cash in on their rebates on a frequent basis need to consider whether or not they will be able to use the rebates before they expire.

Miles Credit Cards: Getting The Most Out Of A Frequent Flyer Credit Card

Airline miles credit cards are among the most popular types of rewards credit cards. However, only a handful of frequent flyer miles credit cards provide great rewards and value. The reason for this is quite simple: most airline specific credit cards charge astronomical annual fees and high interest rates. Now, if you travel often and spend more than $10,000 a year, just about any airline credit card will earn you miles. However, if you want to get free miles, airline flexibility, and save money on interest and annual fees, there are only four miles credit cards you should consider: The Miles Card from Discover, The Value Miles Platinum Visa Card, American Express Blue Sky and the Citi PremierPass. Here, we will examine all four cards. First, however, we will examine the average airline specific credit card.

The lure of the “average” airline specific frequent flyer credit card is the bonus mile offering. Who wouldn’t want 15,000 miles? In addition to the substantial free miles offered, the average airline credit card also waives the annual fee during the first year. The combination of free miles and a no fee first year draws in many consumers. However, the initial perks are generally offset by the money it will cost to maintain your credit card after the first year. First, the average annual fee charged by these credit cards is $75. Ouch. And the average interest rate? More than 17%. Sure, you get a lot of miles upfront, but is it really worth paying 5% more in interest and a substantial annual fee? Not when there are much better offers available.

The Miles Card from Discover is a no annual fee airline rewards card that offers a 0% interest rate for 1 year, a low long term interest rate, and the opportunity to earn 1 mile for every dollar spent. The miles you earn can be redeemed on any airline with no blackout dates. Plus, you get 5,000 bonus miles when you make your first purchase. The interest rate on this credit card is over 6% less than that of the “average” frequent flyer card. Plus, you pay no interest on purchases or balance transfers for up to 1 year. Although you get 10,000 less miles, you’ll probably end up with a lot more money to spend on traveling with this card than you would with the “average miles card.”

The Chase Value Miles credit card is a no annual fee airline rewards card that allows you to fly on any airline with no blackout dates. They do not give away free miles, but they also don’t charge an annual fee or a high interest rate. Like the Miles Card, the Value Miles card offers a 0% interest rate for up to 1 year and offers an interest rate that is 5.5% lower than than “average miles card.” And, although the Value Miles Card does not offer any free miles, you can get a ticket to fly anywhere in the continental U.S. for only 24,000 miles. This is 5,000 to 10,000 miles less than the “average miles card” charges to get a free ticket. You don’t get free miles, but your miles do have more value.

The Citi PremierPass offers two levels of airline rewards. The regular PremierPass MasterCard offers 5,000 free miles, charges no annual fee, and offers an interest rate that is 4.25% lower than the “average miles card.” Additionally, you can earn 1 flightpoint for every three miles you fly on any airline with a ticket purchased with your card.

The Citi PremierPass also offers an elite level. Now, there is an annual fee of $75. However, you receive 15,000 bonus miles, earn 1 flightpoint for every single mile flown, and double miles on everyday purchases. The interest rate is still 4.25% less than the “average miles card,” plus, this card offers a 0% interest rate for up 1 year.

The BlueSky credit card from American Express does not try to lure you in with free miles. Instead, they offer value. For every 7500 points earned, you receive $100 that can be used for any travel expense, including car rentals, hotels, online travel sites, and cruises. The value here is that every point you earn is worth 33% more than than the average point. Plus, you can use your rewards for all of your travel expenses, not just airline tickets. Additionally, this card offers a 0% interest rate for 6 months, charges no annual fee, and offers a low long term interest rate that is 5% lower than the “average miles card.”

As you can see, airline credit cards offer a variety of perks at a variety of prices. For some, an “average miles credit card” with an annual fee of $75 and an interest rate over 17% might provide the best overall value. However, most credit card users will end up paying more money in interest and fees on their credit card than they would if they simply paid for their ticket in cash. The real value in frequent flyer credit cards can be found with the general miles credit cards that charge no fees, offer low interest rates, and offer more travel flexibility.

2006, Credit Card Depot Inc.

There are credit counseling agencies that rescue people from the deepest financial holes. There are also credit counseling agencies that just shovel in more dirt. How do you tell them apart?
by Joel Walsh

Signs of a Reliable Credit Counseling Agency

__Better Business Bureau Membership
The service’s website should have a BBB logo and a link to their record on the Better Business Bureau website. Click through the link to check that there are no unresolved complaints against them. Many people only think about the Better Business Bureau after they’ve been cheated, but by then there’s not much you can do. Working with a credit counseling agency that is a member of the Better Business Bureau means that you can go to them to help mediate any dispute you might have with the service provider.

__Accreditation
Reputable credit counseling services will be accredited by an independent nonprofit, just as many schools are. One such accreditation body is the National Institute for Financial Counseling Education.

__Fees
A good credit counseling agency will charge a small, reasonable monthly fee, usually around $30. Some also charge a fee upfront, though this fee should be reasonable (around $50 tops). It may be possible to get a hardship waiver of these fees if you truly do not have the $30-50.

__Clear Application
The application must clearly say what the fees to be paid are, what the services to be provided are, and in what timeframe all of this will be provided.

__Reasonable Promises
Run far, far away from any organization that proposes to “wipe out” your debt for you, rather than simply helping you to repay the debt. Short of your creditors just deciding to forget about the debt (unlikely), there is no way to erase debteven bankruptcy leaves a huge mark on your credit report for ten years.

True, your car may not go missing from your driveway if you stop paying unsecured debt (i.e., debt that is not “secured” with collateral, like most credit cards, unlike most auto loans). But you are still legally obligated to pay the debt, and the possibility of being taken to court will loom over you. You will likely be unable to get even “bad credit” financing if you still have debts in collectionsgood luck buying a car or house.

Not Necessarily Signs of a Reliable Agency
XX Nonprofit Status
Nonprofit status is essentially a tax designation, not a government endorsement of a group’s mission. There are plenty of near-fraudulent credit counseling agencies that are registered nonprofits.

XX Respectable Name
Any group can put words like “National,” “Alliance,” “Assistance,” and other trust-inspiring words in their name. But a name is just a name. Make sure to check any organization against the list above to make sure they’re reliable. Also try searching for the group’s name on a search engine. Don’t just look for a lack of negative reportsthat might just mean the group changed names recently. Instead, look for positive reviews from real people, and preferably mention on reputable third-party websites, such as news sites.

Ready to find a credit counseling agency? You’re in the right place: the web is full of credit counseling agencies. Just use the checklist above, and you’ll have no trouble separating the saints from the scams.