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Many people think that debt consolidation loans will solve all of their financial problems, but these loans may not be the perfect way to solve everyone?s debt issues. To determine whether or not a debt consolidation loan is right for you, you must know what it is and exactly how it works.

The Debt Consolidation Loan Defined

A debt consolidation loan is used to pay off other debts. Most people utilize debt consolidation loans to take advantage of lower interest rates, fixed interest rates, or for the convenience of making only one payment every month as opposed to several. In certain cases, you may be able to get an unsecured debt consolidation loans, but not all lenders are willing to loan money on good faith alone. You may be required to put up some sort of collateral, such as a house, to become eligible for a debt consolidation loan.

Who Should Consider a Debt Consolidation Loan?

Debt consolidation loans are often recommended for people who carry a large amount of credit card debt. Credit cards often carry the penalty of high interest. Debt consolidation loans typically have a lower interest rate. Still, you should think carefully before taking the plunge. You may be able to get away with skipping a payment or two on your credit cards, but Read more…

What do you worry about most when it comes to your finances and debt or your credit card repayments? It seems that men and women have different outlooks and think differently about their finances. A survey was carried out to see whether men and women thought differently or the same about their finances.

Women tend to look at their current levels of debt while men tend to look to the future and are more likely to plan ahead when it comes to their finances. Women worry more about how they are going to pay off all their current credit card bills, store cards and loans along with their mortgage, shopping and living expenses with three quarters of women doing so, meanwhile less than 50% of men worry about the same thing. Only 13% of men know what their current debt levels are.

While men are laid back about their current debt levels they are better prepared for the future. Men are better at investing their money with half of all men investing in an ISA while only 35% of women are doing the same. Only five out of ten of women have a savings account with men in the lead with six out of every ten. Three quarters of men are paying into a pension for when they retire while only half of women are preparing for their retirement.

The only things that were found to be very little difference in when it came to our finances was the fact that both men and women have little knowledge of credit reports and how they work, although we think we do. Three quarters of men and women said they new what Read more…

There are three reasons that you might have missed a payment on your credit card: either you can?t afford to pay, the payment didn?t get there in time or you just plain forgot. For whatever reason, there?s one thing you need to do, and quickly ? get on the phone.

Then, apologise like you?ve never apologised before. Don?t panic, stay calm, but make it clear to the customer service representative that you?re very sorry. Say that things like this never happen to you. If you just forgot, then tell the truth about what happened. But if you can?t afford to pay, then you should say so too.

You will be surprised at how sympathetic credit card companies can be if you phone and apologise. After all, the sensible ones want to keep you paying interest to them for a long time to come, so it?s not really in their interest to punish you.

Remember to show your appreciation if they let you off. Promise that it won?t happen again. Whatever you do, don?t get angry or frustrated. You need their goodwill and to be in their good books.

However, if deemed necessary, you may also want to show that you are willing to transfer your balance elsewhere if they won?t let you off this one mistake. Credit card companies will usually be more accommodating to your request once you make this known.

You need to do everything you can to persuade them not to add your late payment to your credit report. Any negativity in your credit report may adversely affect your applications for any credit. Remember that any late payment can be a black mark against your name for as long as Read more…

You need to manage your credit cards wisely. Otherwise, you may end up in financial trouble. Unfortunately, there are many who don?t realise that they may be making huge mistakes with the use of their credit cards. Here are top 7 credit card mistakes that card holders make:

1. Paying Just the Minimum Sum.
The minimum sum is just an amount that you must pay back each month to avoid defaulting on the debt. If you pay just the minimum sum, the rest of your outstanding is subject to interest computations. Always pay back more than the minimum sum or make full payments to avoid credit card debt.

2. Making Late Payments.

If you don?t set up any kind of automatic debit payment from your bank account, then it can be tempting to just put your credit card bill aside and get to it when you have time. Before you know it, a few weeks have gone by and you?re late. If you leave it to the deadline, you may find that the payment won?t get there quickly enough.

Paying late is a big mistake for an awful lot of reasons. You will almost certainly be charged a late payment fee, and your late payment will go on your credit report. You may also find that you lose any good rate you had or any preferential rates that you may in the future receive.

To avoid late payment, you should always post your payment a long time before the due date (at least a week). If you?ve left it to the last minute, phone up and try to pay that way.

3.Being deceived by Offers from Credit Card Companies.

It is never, ever worth getting a higher-interest card simply because it offers some kind of loyalty points, flight miles or whatever. Even if it offers a cash reward, it is unlikely to be more than you would pay in extra interest ? after all, why would they give you free money?

4. Collecting Cards.

Some think it looks good on them to have a wallet choked full of credit cards. Especially if the wallet is packed with gold and platinum ones. But envy not! These card holders may well in a situation of having to keep track of all the different cards, balances and interest rates.

In fact, you should limit yourself to a maximum of three Read more…

Tackling high levels of credit card debt is not an easy thing to do. With the average interest rates charged on credit card loans still hovering at all time record highs, it can be extremely difficult to pay off even a small credit card balance. It is, however, important to pay those balances of, and to do it as quickly as possible. Doing so will not only save you a ton in interest payments and other charges, but it will put you on firmer financial footing when you need money for other things, like buying a house or a car.

Missed credit card payments and the like can wreak havoc with your credit report and credit score, and your credit history will be vital when it comes to making major purchases like a home or a car. The sooner you deal with and eliminate your credit card debt the sooner you will be able to clear your credit report and get your financial life back.

While many people feel confident in negotiating with their credit card companies themselves, many are not, and those people may be better off seeking the services of a credit counseling service. Credit card companies can be notoriously hard to deal with for many consumers, but credit counselors understand how to Read more…

Here are ten simple tips to help you pay off your credit card debts sooner. First the boring bit: the first three steps are boring but vital. If you want to take control, you have to know what?s going on. Taking control of your finances can feel like a straitjacket, so plan in some light relief for when you achieve each step ? but make sure it doesn?t cost much money. For example, when you?ve done step one, invite some friends round for a meal, or go for a walk in a favorite park, or treat yourself to time listening to your favorite album. Repeat your mini-celebrations as you achieve each step.

1. It?s likely that if you have a credit card debt, you?ve got some other debt too. But whether you have or you haven?t the first thing you need to do is make a total of all your debts. Don?t hide anything ? don?t pretend it isn?t a debt. The more honest you are with yourself, the sooner you?ll get financial control back in your life.

2. Once you?ve got all your debts listed and totaled, make a check on all your regular outgoings for credit cards, food, rent, bills, gas, whatever ? weekly, monthly and yearly. For the weekly and yearly ones, convert them into monthly figures. You should now have a clear picture of your regular outgoings as well as how much debt you have.

3. Now what?s your monthly income? This figure should be the amount that goes into your paycheck before anything else comes out. Subtract your monthly outgoings from your monthly income. Hopefully the figure you?ve got has a plus sign in front of it! But even if it doesn?t, now?s the time to move on to stage 4.

4. How many credit cards do you have? How many loans? You?ve already totaled the amount of debt. Now you need to get clear about how spread out it is. Debts spread out like an octopus are not a good idea. You end up losing track of some and trying to juggle between them ? and all that does is increase your debt.

5. We?re talking here about credit card debt, so the next step Read more…

Unfortunately, this is the case for many graduating students.
You may have seen recent reports and news stories about enormous student credit card debt. Or worse, you may be experiencing it firsthand! You are not alone.

According to Nellie Mae, a leading provider of higher education loans, a study of last year’s student loan applicants showed:

Graduate Student Credit Card Debt

- Students with no Credit History 1%

- Students with a Credit History having no Credit Cards 4%

- Student with a Credit History and had Credit Cards 95%

Of the 95% who have credit cards:

- Average number of credit cards = 4

- Average credit card debt = $4,776 (median=$3,068)

- 20% have credit card debt between $6,000 – $15,000

- 6% have credit card debt greater than $15,000

Undergraduate Student Credit Card Debt

- Students with no Credit History 12%

- Students with a Credit History having no Credit Cards 10%

- Student with a Credit History and had Credit Cards 78%

Of the 78% who have credit cards:

- 32% have four or more cards

- Average number of credit cards = 3

- Average credit card debt = $2,748 (median=$1,236)

- 13% have credit card debt between $3,000 – $7,000

- 9% have credit card debt greater than $7,000

So what’s the lesson? It?s doen?t necessary mean that you spend too much money, that?s your own private issue. It?s about beeing aware and spend sensibly, with a wise use of your credit card. Debt can sneak up on you quickly. Below are a few tips to keep your debt in check.

Use cash instead of plastic whenever possible. A lunch at the student union here, a night on the town there…it all adds up. Keeping your credit cards in your wallet will prevent a nasty surprise at the end of the month and when you graduate.

Debit cards and Read more…

Debt management is a course every American needs to take simply because so many Americans are clueless when it comes to credit and debt management. This is unfortunate because many people do permanent damage to their credit record by not knowing how important managing their credit is. Also, frequently people get in trouble with debt and don?t know debt management tips, so they simply get further and further behind each month. This does not have to be the case and debt management is not difficult to do, as long as you have the desire to reduce your debt. Consider these debt management suggestions to get you out of debt quick.

Debt Management Tip #1 Make Your Payments on Time

One of the most important things you can do to help your credit score is to make your payments on time. This is also a great way to avoid late charges which not only negatively impact your credit, but also negatively impacts your wallet. Debt management means making on time payments means your account will never be late, will not go into default and will not never have late fees associated with it. If you have problems making your payment on time imagine how much worse it will be when an additional $30 – $50 is tacked onto that payment.

Debt Management Tip #2 Work with Your Creditor

Proper debt management requires working with your creditors. Many times creditors have debt management plans, as well as suspended Read more…

Some banks are eliminating the standard 25 or 30-day grace period within which you may pay your bill within being charged interest. This is the normal grace period before interest kicks in. But this is slowly changing. For example, some banks are offering extremely low fixed rates, but without a grace period. These cards will charge you interest from the date it processes your charge slip.

If you usally pay your bills in full within the normal grace period, it is best you avoid no-grace-period cards. The 25 or 30-day garce period is more financially significant for you than a lower interest rate. However, if you carry a balance each month, you’re better off with a lower interest rate. In this case, a lower interest rate can save you more money than a grace period would.

Most banks and thrifts charge interest from the day they process your charge slip when you use your card to get cash. In addition to this, some cards are now assessing cash advanced service charges based on a percentage of the amount received. It used to be that service charges were based on a fixed fee, regardless of the amount of transaction.

If you avoid interest charges by paying off your bill each month, seek out a card that offer very low interest rates plus a grace period on purchases. Some institutions periodically offer cards with no fee for the first year as a promotion.

Don’t be lulled into getting “premium” credit cards such as “goldcards” and Premier VISA. The only significant premium with these cards is the extra amount you pay in higher annual service fees. Besides the fancy finish of the card, the only other benefits you get with premium cards are travel insurance and the extra protection if your card is lost or stolen. Since by law, you are only liable for up to $50 if your regular credit cards are lost or stolen, the zero liability you are getting from premium cards is hardly worth the extra money.

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IMPROVING YOUR CREDIT BY PAYING BILLS LATER,
RATHER THAN SOONER!
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Every business will get to the point where suppliers will offer terms on bills, rather than requiring payment up front or on delivery. Their bills will probably be marked “2/10, net 30.” This means you get a 2% discount if you pay within 10 days, and the bill is due within 30 days. Many business owners will jump at the opportunity to save the 2% by paying early, and rightfully so. However, believe it or not, they can help their credit rating by paying at the end of 30 days.

How is this so?

It’s all a matter of your business’ CREDIT HISTORY. All of the companies who offer you terms will be reporting your history to various credit bureaus. These bureaus are who gets consulted by banks when they decide whether or not to give you a loan.

By always taking advantage of the 2% discount, a business establishes a paying pattern. Thus, if you’ve been paying a company’s bills in 5 days for the past year, this is what they will expect from forthcoming bills.

Now, say one month has a tighter cash flow than normal, and you must take 20 days to pay that bill. This sends up a red flag for the billing company. You normally pay in 5 days, why are you now paying in 20? Even though you paid the bill well within the deadline, you have given a sign that you had a cash flow problem. This uneven paying pattern can show up on your credit rating. Even though all your bills are paid on time, an uneven paying pattern and jeopardize your future chances for more and larger credit limits.

Now, if you always pay your bills on the 25th day of the due period, even when you can pay them early, that cash poor month won’t look any different to the billing company. Most companies would rather grant terms to a company that always pays on the 25th day, than one that sometimes pays early, sometimes pays later, as this reflects an image of disorganization and uneven cash flow.

Also, always paying toward the end of the due period will aid your cash flow. If you pay your bills consistently, at the same time every month, you will not be surprised by a sudden cash shortage.

For example, say you decide to pay a bill early one month.

Then, the next week, your main supplier calls to tell you about a closeout deal he has that would double your profits.

Only problem is he can’t offer terms, it has to be cash.

Because you paid that bill early, you can’t take advantage of the special deal. If you would have waited to pay it, your cash flow would have allowed the purchase, and the resulting higher profit margin would have yielded the cash to pay the bill.

So, you see, paying bills later, and not taking advantage of any early payment discounts, CAN work to your advantage. You need to consider your future plans and decide if saving 2% now is really worth it.

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WOMEN AND CREDIT
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Many women complain about not having any credit. Those complaining are those who REALIZE that they do not have credit, single women or divorced women, specifically.

However, there are many married women who have no credit because financial matters are handled by their husbands, and they are not even aware that they are without any type of credit rating. This is a large Read more…

People have always had to choose the right credit card for them. But in the past, this choice dealt mainly with interest rates, grace periods, and credit limits. All of this is still true, however, there is one more aspect you will want to consider – customer loyalty plans!

What Is a Customer Loyalty Plan?

Some of the most well-known customer loyalty plans are the frequent flyer programs of the major airlines. Programs such as these have been used to keep customer loyalty for many years. Loyal customers are often treated better than those that buy on the spot. The idea was to reward your customer for being YOUR customer. And the credit card companies, seeing a good idea, do what all smart companies do when they see a good idea – they copied it!

It started with cash back bonuses. Cards like Discover offered a percentage back for everything spent – money you got back for using their card. Then airlines started letting people earn frequent flyer miles not just by flying their airline, but by using their airline Visa or MasterCard. And from there, the sky has been the limit!

What Kinds of Plans Are Available?

Besides cash and plane tickets, you can go to Disney World, earn free gas for your car, get merchandise from your favorite store like REI or Saks Fifth Avenue, or even get free groceries. But don’t let your mind stop on the obvious!

Have you ever wanted to own your own island? Well, that may be a bit far fetched, but you can use your credit card to earn enough points to rent your own island!

Is you child just dying to go to space camp? Find a card that will let you earn the credits to send him to NASA for five days!

Some cards are very specific and allow you to only use your points towards something specific, like a GM car. Others offer you the ability to use your points towards a variety of opportunities. So, whatever you have always wanted to do or see or buy, now is the time to find a credit card that will help you turn that dream into a reality.

Calculating the Costs

Just as not every card is created equally in the “interest” department, neither are they created equally in the “point” department. Some give you one point for every dollar you Read more…