Credit Card Introductory Rates Can Bite You

Writen by Charles Essmeier

The credit card industry is a competitive one; all you have to do to see that is open your mailbox. For many consumers, pre-approved credit card applications can be found every week in the mail, often accompanied by offers to let you transfer an existing balance from another credit card at a low interest rate. Sometimes these rates, known as "teaser" rates, can run as low as 0%, which can make applying for one of these cards rather tempting. Be careful, though. The fine print in the terms of agreement on those cards could hide some very expensive surprises.

Here are some things to watch out for in the fine print when you apply for a card with a low-interest introductory offer:

Default rate – How high can the interest rate go if you fail to make a payment on time? This is known as the "default rate." If you pay late, your 0% or 3% interest rate could rise to 30%. Make sure you know.

Duration of the low rate – How long does this "teaser" rate apply? Six months? Until you pay off the transferred balance? Make sure you find out, as these rates often rise to the regular rate that applies to the card after some limited period of time.

Other debts – Does this card agreement have a universal default clause? Many credit card companies will now raise your interest rate if you make a late payment on any bill, such as a telephone bill. Credit card companies claim that paying any bill late makes you a higher risk customer. You don't want your interest rate to rise because you forgot to pay the cable TV bill, so read your terms carefully.

Other charges – These "teaser" rates apply only to transferred balances; they do not apply to new charges. If you use the card to make purchases, those purchases will accrue interest at a higher rate. When you make payments, the payments will be applied to the portion of the balance with the lowest rate first, meaning that these purchases could be accruing interest at the higher rate until you pay off your balance completely.

Any reason, or none – Most card agreements permit the company to raise your interest rate at any time, for any reason. All that is required is two weeks' notice. Keep this in mind if you are transferring a large balance that may take you several years to pay off. Sometimes, "until you pay off the transferred balance " only means until someone at the corporate office changes their mind.

As long as you are aware of the terms, these teaser rates can be quite helpful. If you pay late or fail to read the fine print, you could find yourself paying a lot more in interest. Read the agreement before you apply for the card.

©Copyright 2006 by Retro Marketing. Charles Essmeier is the owner of Retro Marketing, a firm devoted to informational Websites, including End-Your-Debt.com, a site devoted to debt consolidation, personal bankruptcy, establishing credit and credit counseling and HomeEquityHelp.net, a site devoted to information regarding mortgages and home equity loans.

Miles Card How Many Miles Before You Reap

Writen by Robert Alan

A miles card is one of the many credit card options available for the discerning big spenders of today. A miles card definitely amounts to rewards, if utilized in the right way, but more often than not the customer ends up paying out more in finance charges and fees than they would have with a traditional card.

Ever tried figuring out the cost per mile on your miles credit card? Or does that sound like too much work? The bottom line is that you need to earn enough miles on a miles card in a year to ensure that you are not overpaying for the miles. That being the case, you would be better off utilizing a credit card that doesn't charge you an annual fee instead of those cards that come with hefty annual fees.

Know Your Miles Card

Knowing a mile's value on your miles card will help you in ways more than you can imagine, so don't ignore it! There is definitely no point in sticking with a program that offers you rewards of less than 1 mile earned per dollar purchased using the card. You also wouldn not want to fritter away any miles that you earn on your miles card for products or services that give you much less value for your money, but if your reward points are about to expire on the card then, of course, you have no choice but to use them or risk losing them.

Using the Miles on your Miles Credit Card

The first rule of the 'miles' game is to accumulate miles aggressively on your miles credit card. The second is obviously to utilize the miles accumulated on your miles credit card before the expiration date. If you cannot help the soon-to-expire miles on your miles credit card then get them converted into an award certificate, which will extend your decision time by about a year.

Miles Credit Cards… Double the Pleasure

Sometimes, miles credit cards can earn you double miles for a single transaction. For example, there might be a rewards network affiliated to the miles credit card that you are using, such as the American Express Membership Rewards program. By utilizing merchants or vendors within the affiliated network, you can earn extra miles every time you shop or dine at a merchant within the network.

If you're accumulating miles aggressively by utilizing the card for as many purchase items as possible, whether it be large expense items or incidental ones, and then of course paying off those monthly card balances diligently every month, you can maximize the return on your use of miles credit cards. The strategies mentioned above should significantly aid you in this endeavor. Treat your miles like your money, and you are sure to reap the benefits.

For more information on the benefits of a miles card, Robert Alan recommends that you visit CreditCardAssist.com

How Low Interest Credit Cards Work

Writen by Drew Hanson

Low Interest credit cards are exactly what their name suggests. They charge low rates of interest (APR). The APR is calculated in the same way as with other credit cards; this facilitates an easy comparison for an individual who is planning to switch over to these cards. Low interest credit cards are favored by individuals who habitually carry their monthly credit card balance forward. Low interest rates can lead to significant savings on financial charges.

For the introductory period, most low interest credit cards offer 0% APR; however, most credit cards offer 0% APR only for select situations such as balance transfers and major purchases. The introductory period offer can be used for consolidating multiple credit cards that charge high rates into a single low APR credit card. This helps people to reduce the financial charges associated with credit card debts and pay off the existing balances quickly. Often, low interest rate credit card companies will waive the balance transfer fee upon a client's request. Thus, low interest rate cards with rates that can be up to 9 percentage points lower than those of other cards are a great way of saving for those inveterate shoppers who invariably end up with a monthly balance on their credit cards. It is also less taxing to take a cash advance with low interest credit cards. Individuals with poor credit scores may find themselves ineligible for low interest credit cards.

Low interest credit cards may or may not offer other advantages like cash back and travel insurance and should therefore be used with another card that does. This helps a card user to earn benefits from the other card which he may use when he does not intend to keep a balance; for other purchases, the low interest credit card can be used. It is advisable that the oldest extant credit card account that an individual has should not be closed for acquiring a low rate credit card; this is because maintaining credit accounts for long periods reflects well on the credit ratings.

There are several low interest credit cards available in the market. Individuals should do a thorough research to find a card that offers a perfect fit for their needs.

Drew Hanson recommends that you visit http://www.creditcardsearchengine.com for more information on low interest credit cards.

Genuineness Of Credit Card Processing

Writen by Jack Chevalier

According to buyerzone,consumers increasingly are turning to plastic over paper when they open their wallets. Yet many small businesses still don't accept credit cards. If you're one of the laggards, the entire transaction may retain the impression of a spiritual ritual swipe a card, input some numbers and money magically appears in the bank. In reality, though, credit card transactions involve coordination between multiple high-speed computer networks.

How the Process Works: when a merchant makes a sale and swipes a customer's credit card, the card number, the amount and the merchant ID travel over the credit card processor's computer network. The credit card processor can either be a bank or a company that does nothing but provide credit card processing services. From the processor's network the transaction goes to a credit card computer network. If the customer is using Visa, for example, the transaction will go to Visa's network. In turn, the electronic transaction goes to the bank that actually issued the card. The bank then checks the account and verifies the customer has adequate credit to cover the purchase. The bank then sends the merchant an authorization over the network. Now the sale is complete, but the transaction is not no money has changed hands yet. At the end of the business day, the merchant sends that day's charges, in a batch, to the credit card network for processing. The transactions travel via the merchant's credit card processor. Individual transactions are then stripped out and sent back to the individual cardholders' banks. Banks then debit cardholders' accounts and make appropriate payments to the merchant's credit card processor through the Federal Reserve Bank's Automated Clearing House. The credit card processing then includes credits the merchant's bank account for the transaction amount, minus its fees for the transaction. Those fees also go toward paying transaction fees to the issuing bank and the credit card network. Despite the use of computers, it can take two business days before the merchant's account is credited.

Opening a Merchant Account
In order to accept credit cards, you must open a merchant account with a bank. However, many banks have gotten out of the credit card processing business, and those that remain are often restless about servicing small businesses, particularly ones with limited operating histories. Many small businesses must therefore go through a specialized credit card processor or an independent sales organization, commonly referred to as an "ISO." Whether you use a bank or a credit card processor, you need a merchant account to receive credit card payments. Though businesses can contact credit card processors directly, banks unable or unwilling to process credit transactions often refer customers to an ISO to help them find a credit card processor and get the necessary equipment and training to begin accepting credit cards.

For more information on credit card processing,please visit http://www.paynetsystems.com

Your Merchant Account Provider

Writen by Shane Penrod

Whether you own a new, home-based, or established business, you may want to know more about finding a suitable merchant account provider that can help you open an account to expand your business services. A merchant account can help you accept credit card payments from customers instead of relying solely on cash or check. With credit payments, you can be paid immediately, and customers will appreciate the ease and convenience of this payment method. However, it is important to get a merchant account with a lender that you can trust, so that you can utilize services to grow your company without fear of backlash or loss.

When searching for a merchant account provider, don't apply for an account with the first lender to come along. There are hundreds of account providers that would love to have your business, so you don't have to rush into it by accepting the first offer you receive. A good place to start is in your local community. Talk to the bank associate where you currently hold personal or business accounts. Since you have a relationship there already, it should be easy to find out the details of opening a merchant account there, assuming the bank provides one. But perhaps your bank does not offer this service, or if it does, you may not agree with the terms. Ask the banker to recommend another bank in your area where you can meet with the business services associate to discuss your eligibility for a merchant account. If your banker cannot recommend one, check with business associates at civic groups, community organizations, or business associations for referrals to banks or other lenders that offer a merchant account. Then follow up by contacting these lenders for details on obtaining a merchant services account.

A merchant account provider should be affiliated with a trustworthy bank or financial institution, one that you can rely on to stay in business, to offer equitable terms, and to protect your interests. Avoid doing business with a new bank or lender, especially if it is relatively unknown or comes with a checkered past. Merchant accounts are fairly common, so you don't have to apply with a company that you are not comfortable with. You can check the Better Business Bureau to see if there is an open file with the lender and how past disputes have been resolved. Then make an appointment to meet with a company representative to find out more about the terms associated with its merchant services account. Take along your business plan and a budget to explain how your business currently operates and where you want it to go. Be prepared to ask questions about merchant account services, such as the fess associated with the account, the type of maintenance or service that comes with the account, and any risks that your company may face.

Finding a qualified lender can make the difference between success and failure when your company is ready to open a merchant services account. Give some thought and planning to finding a reputable merchant account provider.

Shane Penrod is the founder of http://www.merchant-account-quotes.com Specializing in allowing merchants the ability to shop and compare multiple quotes from national merchant account providers. For free quotes on merchant account rates and fees, please go to http://www.merchant-account-quotes.com

How Your Fica Score Effects Your Personal Credit History

Writen by Gerald Washam

Understand Your Credit

Trying to understand how credit works can be frustrating. Most people do not even know where to begin when trying to identify their personal credit rating. There are three major credit bureaus that report your credit status. These three credit bureaus are Equifax, Experian and TransUnion. All three also keep your FICA or credit score. This score can give you the best idea of how your credit ranks.

FICA...What Is It?

FICA scores range from 375 to 900. In general, the higher your credit score the better you will be able to obtain credit. A FICA score under 620 makes obtaining credit difficult. You should identify what your score is and if it isn't a good number you should then work on making it better. Creditors use your FICA score to determine whether to give you credit and sometimes base interest rates on this score. It is a very important number to know.

Your FICA Score

To determine your credit score you should request your credit report from the three major credit bureaus. The new legislation passed that allows you one free credit report every twelve months does not require the credit bureau to give you your FICA score, so you will probably have to pay for these reports. The contact information for each bureau is as follows:

Equifax 800-685-1111 www.equifax.com

Experian 888-397-3742 www.experian.com

TransUnion 800-916-8800 www.transunion.com

You should receive a copy of your personal credit report that includes your FICA score. Your FICA score is listed along with a comparison to the general population. This lets you know where you fall on the scale from excellent to poor. The credit bureau may include information as to why your score is not higher. Once you have your score you can then determine what you need to do to make it higher.

Raising Your Score

Some simple things can be done to help raise your FICA score. Paying your bills on time, keeping a small amount of unused credit available, keeping your debt low, and avoid inquires to your credit report can all help improve your credit score. Some things like, length of credit history, length of time on your job, and length of time at residence are things you can do nothing about, but that will also affect your FICA score. Practicing good credit methods will help you to obtain a better FICA score.

If you are worried about your personal credit you should really check out your FICA score. Then work to improve it. It may take time, but everyone has the ability to have good credit.

Gerald Washam is the owner of a website devoted to personal credit and credit repair issues. Learn the secrets to repairing, improving and maintaining your credit score. Secrets THEY don't want you to know. Arm yourself with the knowledge you need before contacting the Credit Bureaus. Know what your rights are. Visit us here http://www.creditrepaird.com to find your way to personal credit freedom.

Good Credit Why It Is Important And How To Get It

Writen by Mike Martin

Credit reporting agencies evaluate your credit history and assign you a credit score, a number that can make or break your immediate financial future. Your score determines whether or not you qualify for future credit, and the interest rates on any loans you receive. Your credit score needs to be as high as possible to ensure that you can get low interest loans if you decide to apply for a car loan or a mortgage. If your credit report contains any negative trade-lines, now is the time to start repairing your credit score.

Because a good credit score is a reflection of a good credit report, you need to order your free annual credit report today. Under the Fair Credit Reporting Act (FCRA), you are entitled to a free copy of your credit report from each of the three main agencies once every year.

Once you have copies of your reports, go over the information carefully. Check names, addresses, account numbers, balances, and payment histories; errors in any of these sections can have a negative impact on your credit score. Credit reporting agencies are notorious for mixing up information and filling credit reports with inaccuracies. Check your personal information as well as your account information as errors can be found throughout your report.

If you find information on your reports that is not accurate, you must dispute it immediately with the credit reporting agency. Write a letter to the CRA asking that they verify the information; if they cannot verify within a certain period of time, they must delete it. Make sure to explain in your letter exactly why you believe the information does not belong on your report.

If your credit scores are lower than you expected or hoped, there are steps you can take to bring repair your score. Always pay your bill on time; late payments can really hurt your credit score. Stop living beyond your means; if you can't pay cash, then don't buy it. Do not take out any future loans, and do not cosign for anyone else taking out a loan. You have to commit to taking responsibility for your credit before you can improve your score.

Get rid of your high interest-rate credit cards. Take our a consolidation loan to pay off all your balances, or transfer those balances onto a low interest-rate card. Either of these options can help reduce your debt by lowering your interest payments and allowing you to pay down your principal faster.

Improving your credit will help you regain control of your financial life. Credit counseling is available to help you draft a debt management plan if you don't feel you can handle that burden alone. Knowing your credit score and credit history is the first step on your road to financial recovery.

Michael Martin is a knowledge seeker and publisher of FinancialKnowledgeCenter.com. Here he provides more information on credit cards, credit counseling and How To Obtain a Good Credit Score that will engage your curiosity and stimulate your mind.

14 Common Credit Mistakes

Writen by Jeanette Joy Fisher

Establishing credit and wisely managing your credit becomes easier when you know how. You'll feel empowered by taking knowledgeable steps towards good credit, and you'll be on your way to purchasing real estate and greater financial freedom.

If you plan to finance real estate, either as a home buyer or an investor, avoiding these common credit mistakes will help you with your credit score and save you money in loan costs.

14 Common Credit Mistakes

1. Using expensive or undesirable types of credit costs too much and is negatively scored.

2. Accumulating too many lines of credit or too many credit cards causes credit report remarks like "too much consumer credit."

3. Only paying the minimum due keeps balances too high.

4. Being maxed out on any credit card or line of credit causes deep drops in scores.

5. Taking cash advances costs higher interest and extra fees.

6. Exceeding limit and having to pay over-limit fees is a negative with creditors and causes "high proportional amounts owed" remarks on credit reports and subtracts credit score points.

7. Paying a day or more late causes unnecessary late fees and often increases interest rates.

8. Charging more than you can afford causes a snowball effect of amassing debt with no easy way to pay it off.

9. Letting someone else use your credit, such as co-signing a loan, raises your debt-to-income ratio and possibly adds "too many consumer accounts" on your credit report, which lowers your score.

10. Ignoring credit problems causes unnecessary negative impact. Talk to creditors before being late and make arrangements. This action heads off negative reporting to credit bureaus.

11. Failure to report address changes to creditors causes misplaced bills and late payments.

12. Using partial name, different names, initials instead of whole name, or forgetting Sr. or Jr. causes mix-ups. Use your full legal name to protect you from confusion with similarly named borrowers.

13. Failure to report name changes to creditors also causes confusion.

14. Not checking credit report frequently is one of the most common mistakes consumers make.

You can buy real estate with poor credit, but you will save thousands in loan costs if you maintain good credit. A bad credit report leaves home buyers with sub-prime loans which have higher point charges, prepayment penalties, and higher interest charges, which therefore cost more money.

For instance, a mortgage loan of $150,000, 30-year, fixed interest rate of about 5.72 percent costs around $870 a month. Poor credit scores raise the interest rate over 9 percent and the payments over $1,200.

As you see from these payment differences, good credit means that you can finance a more expensive house with the same income, or save $330 each month.

Credit Requirements for Mortgages

Credit needed to buy real estate is not the same as good credit. Besides your credit score, mortgage lenders consider your debt-to-income ratio and other credit matters, unlike other credit grantors. Your debt-to-income ratio is the comparison of mortgage payment, including taxes, interest, and insurance to your total gross monthly income. Real estate lenders also consider your employment qualifications and your overall debt ratios. Understanding the difference between good credit and the credit needed to obtain real estate financing helps you buy houses!

Avoiding credit mistakes helps you get strong credit and keeps your credit scores up.

Copyright © 2005 Jeanette J. Fisher. All rights reserved. (You may publish this article in its entirety with the following author's information with live links only.)

Jeanette Fisher helps first-time home buyers and beginning real estate investors build strong credit for mortgage financing. Get your free "Credit Tips for Mortgage Financing" report at http://www.recredithelp.com

After Bankruptcy Credit Repair

Writen by Guy Ray

One may be tempted to sit back and do nothing about an after bankruptcy credit repair because the argument is that the bankruptcy stays on one's file anyway for ten years. What's the point then of carrying out an after bankruptcy credit repair?

That kind of nonchalant or indifferent attitude may even get you in deeper trouble. Usually, someone who is proactive and cares about his financial rating is going to do something to his advantage right on day 1.

Why?

To re-establish credibility of course. To mend whatever is broken, and to maintain good relations with your bankers, creditors and anyone who is in the most subtle position to influence how your financial picture will look like from now on. An after bankruptcy credit repair is therefore intelligent planning on your part. And the sooner you do it, the better it is for your credit score. It may be a slow, excruciating process, but with time, people will realize you mean business and are doing everything to get back on your feet. After all bankruptcy is no longer the rare disease it once was. Your next door neighbor could have filed for bankruptcy and your gym coach may have done the same thing.

After bankruptcy credit repair: something beyond your capability?

Since bankruptcy is considered somewhat of a drastic move in the money scheme of things, and a bit of a complicated issue involving a set of dynamics different from a straightforward credit repair matter, you may consider a lawyer-assisted credit repair. He may be able to guide you on what steps you can take when the bankruptcy is put on your record and resides there for the next 7-10 years. Or his partner may know of a credit lead repair that many people still do not know about.

Before you rush over to your lawyer's office, however, you may wish to make a pit stop at the credit bureau and see if you could obtain a copy of your latest credit report. You are allowed one free credit report per year – that's the law – and if you note some discrepancies, you may want to discuss these with your lawyer.

After bankruptcy credit repair is like waking up the next morning after a hideous nightmare. But the idea is to keep moving, facing front, not back. Start by making timely payments on all debt, temper your credit card use, and consolidate all debt. Speak to your creditors – yes – even after you've filed for bankruptcy. Who knows, once they see that you're diligently doing after bankruptcy credit repair, they might be more predisposed to removing negative information from your file.

The above are just a few of the ways that prove you're making an effort for after bankruptcy credit repair.

Guy Ray is an established author with more tan 200 articles to his credit.. If you'd like additional information about after bankruptcy credit repair visit his website at http://www.all-credit-repair-tips.com.

Fix Bad Credit 6 Easy Tips On Rebuilding Your Credit

Writen by Delia Galley

DEBT COUNSELING - AVOID SCAMS

If you are overwhelmed and decide to seek the services of a debt counseling agency, make sure you find a good one.

Before we delve into this topic, let me say that every trade has good people and bad people. Unfortunately, some debt counseling agencies give the good ones a bad name. With that said, there are PLENTY of legitimate Debt Counseling organizations that will help you manage your money and develop a budget that is suitable to your situation.

The first thing to do is RESEARCH. Look for a debt counselors in your area of residence that will work with you face-to-face. You may want to check with the State Attorney General or the Better Business Bureau (BBB) to get a sense of their reputation. Both sources can tell you, if complaints have been filed against the counseling agency.

The FTC recommends asking questions such as the following, when looking for a good credit counseling service:

· What services do you offer?

Stick with debt counselors who offer a full range of services including budget counseling, savings and debt management classes. Avoid organizations that do not encourage you to analyze your current debts or financial situation. This is important as we discussed in step #4.

· Will you help me develop a plan for avoiding problems in the future?

· What are your fees? Are there set-up and/or monthly fees? Get a specific price quote in writing.

· Will I have a formal written agreement or contract with you? Do not sign anything without reading it first. Make sure all verbal promises are in writing.

· Are you licensed to offer your services in my state?

· What are the qualifications of your counselors? Are they accredited or certified by an outside organization? If so, by whom? If not, how are they trained?

· What assurance do I have that information about me (including my address, phone number, and financial information) will be kept confidential and secure?

In addition, avoid organizations that promise to:

· guarantee they can remove your unsecured debt

· promise that unsecured debts can be paid off with pennies on the dollar

· claim that using their system will let you avoid bankruptcy

· require substantial monthly service fees

· demand payment of a percentage of savings

· tell you to stop making payments to or communicating with your creditors

· require you to make monthly payments to them, rather than with your creditor

· claim that creditors never sue consumers for non-payment of unsecured debt

· promise that using their system will have no negative impact on your credit report

· claim that they can remove accurate negative information from your credit report.

Visit www.poorcreditgenie.com for additional articles on how to rebuild your credit:

Get a free credit report.

Read and understand your credit report.

Fix credit report errors.

Analyze your current debts.

Create a budget.

Practice good debt management habits.

Make extra money and save money.

The author is the owner of the information-rich website http://www.poorcreditgenie.com. The website offers free advice on how to rebuild credit and manage debt. The site also features numerous articles and news stories on credit report, credit cards and bankruptcy.

Unsecured Loans Your Solution To An Improved Credit Score

Writen by Mika Hamilton

A bad credit score used to make it impossible for individuals and families to borrow money for home and car financing. Today, there are several companies which not only give individuals with bad credit unsecured loans but actually cater to people who have extremely low credit scores.

If you are interested in an unsecured loan there are a number of issues to explore before applying. The first and most important step is knowing how bad your credit score is. The easiest way to get your credit score is to go to a credit agency. However, there are banks and mortgage companies which offer their customers a free yearly credit report – all you have to do is ask.

The interest rates offered to you can be effected by bad credit scores or no credit at all. There are many websites which offer an instant credit report for a small fee. Another reason to check your credit score is it may not be as bad as you think it is. Often credit ratings are simply misunderstood by individuals.

In process of receiving your credit score be sure to check your credit report for improper information. Credit reports can be the first indication of credit card fraud or identity theft. Both of which can leave individuals and their families emotionally and financially devastated.

Once you have your credit score you can use any one of the online loan evaluators. These calculators will allow you to figure out how much money you can borrow and the interest rates that are available to you. It is important to make an informed decision when picking a loan provider. While television advertisements and newspaper ads can be tempting, it is better to research a number of established and reputable loan organizations.

Many "get money now" companies have hidden costs and penalties which consumers are not aware of until after they sign the papers. Looking around for loan companies online is a great way to save money and time. Many lenders have online applications which can be filled out for free. Once you have made your list of possible lenders it is a good to have specific criteria for choosing your loan company.

Besides choosing a company that has a good business reputation choose one that is going to offer you the best deal. This does not always mean the lowest interest rate. Other things to consider are the time period for repayment, penalties if you pay the loan off to quickly, what are the late fees, is the interest rate variable or fixed, and what is the APR.

Unsecured loans usually let an individual borrow less than a secured loan. The interest rate is usually higher for an unsecured loan.

One of the benefits of going with an unsecured loan is it is usually approved quicker which means you get the money faster. This is because secured loans need property to secure it. Property must first be evaluated to see how much it is worth.

Unsecured loans are a great way for individuals who do suffer from bad credit to improve their credit rating, consolidate debt, take vacation, or cover unexpected medical expenses.

Visit the Global Investment Institute and signup for our free Investing For The Beginner E-Course at http://www.Global-Investment-Institute.com Investment webmasters or publishers, please feel free to use this article provided this reference is included and all links remain active.

Reduce The Costs Of Your Credit Cards

Writen by Joseph Kenny

Statistics show that the average American family owes over $8,000 in credit card debt. This is a large amount of money, especially when you consider the fact that most Americans make about $33,000 per year. The costs involved with using credit cards can be very large if you're not responsible when using them. In this article I will discuss steps you can take in order to reduce the costs of your credit cards.

Keep The Credit Card APR Low

The interest on credit cards tend to increase at a rate which is difficult for minimum payment amounts to reduce. In the last decade many people have begun using credit cards to make large purchases and because of this the credit card industry is making billions of dollars a year, and will continue to do so in the future due to the residual income they will receive from payments made by their customers. Since the typical American only makes about $33,000 per year, it is not easy to pay off $10,000, especially when the interest continues to accrue. This puts many people into debt which make take years to pay off.

If you have an interest rate on your credit card which is higher than 19%, you will have an extremely difficult time paying it off. Because of this it is wise to avoid using credit cards which have high interest rates. If you should become late on your bills, call the company and ask if the fee can be reversed. They should reverse this charge if it is your first time being late.

Federal Bankruptcy Law

The government has also recently passed a Federal Bankruptcy law which will make it harder for people to file bankruptcy once they get in debt. If you have good credit, you can easily get a credit card which has a interest rate which is less than 10%. All you have to do is make payments on time and there shouldn't be any problems. The problems generally start when people fail to make their payments on time. The late fees on credit cards can be as high as 30 dollars. Not making your payments on time can also cause the credit card company to raise the interest rates.

Step One To Lower Credit Card Costs

The first thing you want to do to lower the cost of your credit cards is to find a credit card company which offers the lowest interest rate. You don't want to pay more in interest than you have to. You also want to make sure you make your payments on time. Setting up automatic debits from your bank account or using the internet to make payments is a great way to insure that your bills get paid on time. If you are making payments with checks, you should stop. They have a tendency to get lost in the mail.

Transfer Those High Balances

You will also want to move your balances from high interest credit cards to lower interest accounts. Many credit card companies offer promotions, and this is a great time to get lower interest rates. You should also use cash as much as possible. Only use your credit cards when it is absolutely necessary. You also want to pay the full amounts of your balances each month if you can. This will keep interest from getting out of hand. It would also be a good idea to avoid cash advances as much as possible.

Keeping a Clean Credit History

Doing these things will allow you to greatly reduce the cost of your credit cards. Being in debt, which you can't get out of could almost be compared to slavery in some ways. It is ultimately the consumer who puts themselves in debt. Understanding credit cards and being responsible with them is one of the most important factors in getting good credit. Your employment and other factors may depend on your credit rating. Credit is an important part of our society, and it is critical that you understand how to manage it.

Joe Kenny writes for the credit card information site http://www.cardguide.co.uk, visit them today for more credit card articles.

Check Out Your Credit Rating

Writen by Rupert Swarbrick

What is a credit rating?

Any reputable company to whom you apply for a loan (or mortgage) wants to know what sort of person you are - specifically, whether you're the sort of person that'll pay their money back to them. If a friend asked you for money, you'd probably consider something similar - do they already owe you money? have they paid any debts back in the past? are they likely to be able to pay you back?

Well, a credit rating is a sort of numerical value attached to you indicating your trustworthiness to receive your loan and lenders always take a look at it before advancing you any money. What affects my credit rating?

Credit ratings are computed from your credit record, which is held by credit reference agencies, who keep a record of your financial history. A credit record includes information about how you have handled credit in the past and how much debt you have. Most of the information about your credit is only kept by agencies for about six years, although bankruptcy filings, among other major items, are kept for longer.

The most significant factor affecting a credit rating is missed repayments - if you look at it from the point of view of a potential creditor, you missing repayments means you're much less likely to pay them back. The other really important factor is to make sure you're registered on the local electoral roll. Any credit check will include checking you live where you say you do, and this is performed by looking up your name on the electoral roll. Surely, you can't expect someone to give you money if they think you've lied about your address!

Other relevant unhelpful factors on your credit report include CCJ's (County Court Judgements), which are court cases in which an individual is taken to court for the recovery of a sum of money; associations with someone with a bad credit rating (you need to be financially connected with a shared account) and a history of many credit searches. You can avoid the last by only applying for credit when you're certain you should qualify and, if declined credit, taking steps to sort out the problem before reapplying.

How can I see my credit report?

The two major credit checking agencies are Experian and Equifax. You can apply to see your credit report via either of them - Experian charge £2 if you sign up to their online service and Equifax charge £12.50, although you can also sign up to their Credit Watch, which costs £7.99 per month and notifies you within 24 hours whenever your report changes.

Once you have your credit report, you can request alterations to it if there is incorrect information. Note that a record of a credit check made by a prospective lender will only be removed on that lender's decision, and you need to apply directly to them.

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Collection Agency Secrets For Collecting On Bad Debt

Writen by Steve Austin

Getting worried that one of your clients, customers or patients will never pay? Have you given up on a customer who's essentially said he won't pay? Congratulations--being stiffed by a customer or patient is a milestone in the growth of a business or medical practice. But even the most hopeless of bad debts can sometimes be collected—collection agencies have been doing it for years. Here are six of their secrets.

1) Don't just call, write.
According to a leading collection agency, you're much more likely to collect on bad debts when you send a series of collection letters. Deep down, you probably know why collection letters are better. It's the same reasons that would make you uncomfortable placing such a call in the first place: 1) if a debtor knows why you are calling they will avoid your calls; and 2) if you do get them on the phone they will most likely have a bad attitude, or just make excuses like 'the check is in the mail' to get you off their back.

2) Don't ask if, ask when.
This leading also recommends that you try to get your debtor to set a date for paying you back. The people who owe you money may have been saying to themselves that they will get around to paying you any day now. But tomorrow never comes, which is why you need a specific date. When you call, start by asking to be paid today, then negotiate from there.

3) Be nice.
Courtesy is important because: 1) it lets you keep the moral high ground; 2) it makes it likelier that you can establish a cooperative relationship with the debtor for getting the debt repaid; and 3) there are very strong laws against harassment in the collections process and you do not want even to approach their limits.

4) Be cooperative
Remember: you and your debtor have one thing in common: you both want this debt to go away. In particular, you both want you to stop having to make all these calls and send all these letters. With that shared goal you and your debtor can work together to create a repayment plan. While a repayment plan may not be what you had hoped, it's better than holding onto a bad debt.

5) Know the value of your time
The one thing that is probably keeping you from collecting on your supposedly bad debt is your fear that the time you spend collecting the debt may not be worth whatever you will recover. This fear is justified; your time is valuable and maybe it would be better spent on getting new business.

But don't just let this fear linger in the back of your mind, fighting with the little voice that says you want your money. To get a rough idea of how much time you can afford to spend collecting the debt, and whether you have the time to do it at all, sit down and write out a rough estimate of the value of your time, the likelihood of collecting, and the amount you are owed.

For instance, let's say you are going to assign this task to an administrative assistant whose time is worth $15/hour. The debt is $1000. It is owed you by an old customer who is three months behind but has never been seriously delinquent before, so you say you have a 50% chance of getting the money, making the value of the collection about $500.

You divide $500 by $15 and find that your assistant could spend 33 hours collecting the debt before it lost your company money. However, you'd probably still feel a little unsure about whether it was all worth it. Your feelings would be correct: there's still the opportunity cost of all the work your assistant won't be doing to keep your business moving. To be safe, you can also estimate the opportunity cost at another $15/hour, which means you can only really afford to have your assistant spend half as much time, or 16 and a half hours. If you've already spent that much time already, it's time either to call it quits or call in the professionals.

6) Get a collection agency
The one secret the collection agencies know about collections is the value their services deliver clients. Unfortunately, businesses do not usually agree to write testimonials for their collection agencies or even recommend them to a friend. If you didn't know that there are small business collection agencies that will collect your bad debt for under $20, you have to admit that leaving your collections to the pros is a pretty good business secret. In short, you don't want your bad debt to cost you twice: once when you lose it, and again when you waste a lot of your or your people's time going after it. Going with a collection agency can help you avoid either outcome.

Steve Austin is a regular contributor to Let No Debt Remain Outstanding (http://www.let-no-debt-remain-outstanding.com/), a website with articles on choosing a collection agency, along with recommended the best collection agencies.

Vantage Score Friend Or Foe

Writen by Kimberly Kellish

The Big 3 Credit Bureaus have recently announced they will be releasing their newly formed Vantage Score this year to take on the current FICO credit rating system. Many are concerned about how effective this new rating system will be. Will consumers benefit from this new source of credit score or will they be left with more information to monitor and more credit reporting information to keep track of?

Traditionally, FICO credit scoring system has been the most highly except credit report and credit score by lenders. This score ranges from 500-850 and will give lenders a overall analysis of what your credit handling is. The new Vantage Score, and what we know about it so far, will be a range from 501- 990 and will attach a letter grade to it ranging from an "A" to an "F". This letter grade could end up hurting consumers more then helping it. Take for example a person applies for a mortgage and the lender sees only a "C" rating which would be a credit score, based on their system in the range of 701-800. What if the best loan rate would need a "B" rating and your score is 798? Typically lenders would be more flexible if they see your score was close to a threshold, but this all encompassing letter grade would make it less flexible.

We have to wonder, when these credit bureaus could not even agree on a credit score as separate entities for an individual, how well will they be able to agree on a score in their new partnership? It is a shame that it took so long for people to become more aware of their credit reports but now they will be forced to learn a new credit rating system to adapt to a new credit report. In a day when identity theft is running ramped in our society, we are forced to constantly monitor our credit reports to know who is looking at them or who could be using our identification to apply for credit.

We will have to wait until the actual scores are released to fully understand all the elements they will use to determine our credit score. Experian, so far is the only one that has committed to releasing their new Vantage Scores later this summer. Competition is always healthy in business, competition will inevitably help consumers, but until we know all the details about the new Vantage Score, we will have to sit back and wait to see how consumer friendly this new credit rating system really will be.

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