Another Chance for Clients with Bad Credit

Who says bad credit cannot get you the credit card deal you need? More credit card companies are providing the loans subprime clients need, however these are all for a huge price.

According to Equifax more financial intermediaries are lending to customers with credit scores that are lower than 660. In fact, the ratio of these lending increased to 41% in 2011 with banks spending almost 1.1 million for loans for subprime borrowers.

However, there were new regulations that were imposed for the transactions with clients with low credit scores. One of these is the increase in credit limit for the clients by 55% from the previous years to last year.

According to Credit.com’s Beverly Harzog, it was more difficult for people with bad credit to get loans last year, but now that financial institutions are starting to ease up, and are realizing that they need to expand their businesses in order to get higher profit they gave subprime lending another shot.

But the generosity that banks and other credit lending institutions are offering to clients with not-so-good credit comes with a bigger price. Not only are the terms strict and sometimes unfavorable for the clients, the interest rates that the banks impose are also very high.

It is wise to always put in mind that the lower your credit score is, the higher credit interest rates would be offered to you.However, to save consumers some slack, here is one credit card that offers decent deals for subprime lenders.

The First Premier credit card, this is especially created for clients with low credit scores and it charges about $200 annually, and has a 36% APR. Experts’ advice to clients is to read the terms and conditions first before getting credit cards. This is to prevent you from falling into the trap of institutions that charge fees that are too high for you.For clients with really bad credit, a secured credit card is the best option for you.

Many people find it difficult to manage their financial needs due to recessions and unexpected events like an emergency, a divorce, hospitalizations and many more. This leads them to fall into bad credit. Those with bad credit and wish to get out of that state can get a secured credit card from Orchard Bank.

This card will make clients deposit a minimum of $200, the APR is not high at 7.99% and the $35 yearly fee is not charged to consumers for the first year. Just the thing you need to get you back on track.

Closing a Credit Card is Not a Bright Idea

Credit card holders are facing serious problems with their financial status today. Many are struggling with their accounts, and they are starting to formulate strategies in order to lessen the loans they are applying from credit companies. One of these strategies is cutting off their credit card account for good, but this is not a very good solution.

One of the biggest mistakes that credit card owners make is paying off the whole balance and afterwards deactivates the account. Though it might seem like a practically smart idea, it is not the correct solution to a customer’s financial problem. Possible drawbacks may occur on the customer’s credit standing when a customer closes his credit account.

The credit rating of a customer is based upon the average rate of time he has owned the account. So when he closes an account he had possessed for several years, there will be a negative effect on the rating he has.

An individual’s credit score is based on the total sum of money he has borrowed minus the amount of his credit limit. Closing a card will decrease credit limit and will increase their debt ratio and decrease their credit score.

This may result to a positive outcome for the account of clients with yearly fees, for some maintaining a low credit score may allow the owner to keep the credit account active, but it is risky and it is not advisable for borrowers to do this. But for those that do not pay in a yearly basis, the client must try to keep his credit card account open for as long as he can even if he does not use to purchase. It does not only prevent him from getting a low credit score, he can also use it in case he is faced with a monetary crisis.

Bad Credit? No FHA Loans for You

Mortgage loans from the Federal Housing Administration will be discontinued for clients who have unsettled their credit history starting July 1 of this year. This new regulation from the agency will be a safety measure against people who might be unable to pay their loans due to several debts like from credit cards, health related bills, car loans and other liabilities.

This policy will force clients who have not paid their dues of $1,000 or above to clear out their current liabilities first, which is very crucial. The company was supposed to adopt the policy starting April 1 but the date was moved.

However, clients who have been proven to be victims of identity theft or scams will be exempted from the new rule. Those who suffered financial crisis due to emergencies, accidents, joblessness and divorce may be given a loan provided they issue a waiver to the FHA.

This policy may decrease the number or qualified clients to a loan, however it is an action that the agency must take in order to prevent the further collapse of the housing business.

Though this new regulation will be beneficial for the housing businesses, it will not be so beneficial for about 35% of clients who are suffering from financial crisis. This is based on a 2011 study that reported 1 out of 7 citizens are struggling to pay their bills on time, furthermore about 27% of student aids given by financial intermediaries are not paid past the 30 day dude.

Even if financial and economic crisis hit, you should not be taken aback nor be demoralized. You should not allow debt to further ruin your life, take measures to improve your financial standing.

These are the ways you can do that:

Attend the credit seminars given by the Consumer Credit Counseling Services. This will show that you are making the effort to rehabilitate and alleviate your credit status.

Pay off your current balances and update your records. Paying debts will not be enough. It is important to monitor your credit history, in case errors have been committed.

Keep caution, more and more individuals are taking advantage of people who plan to rehabilitate their credit. There are some agencies or people who offer to fix your credit score for you in exchange of a very high amount of money, but these deals often end up as scams and the credit remains unchanged.

Always remember that there is no shortcut to success. Recovering from bad credit requires hard work and perseverance. Train yourself to be financially wise; learn how to plan and follow that plan in order to succeed.

Three Credit Card Options for Bankruptcy

Bankruptcy is a big problem for individuals, not only does it decrease your credit score down to “poor” it also disallows customers who file  it to benefit from credit card perks such as availing low interests, cash rewards and outlay limits.

Credit scores can decrease up to 220 points for an individual, which will affect his life and particularly, ruin it. But declaring bankruptcy does not necessarily mean that an individual cannot use a credit card. In fact, it is a reason for the person to continue rehabilitating his credit score through regular purchases and settlement. Now, the question is what lending company will allow you to borrow money from them despite of your Chapter 13 or Chapter 7 bankruptcy status?

Fret no more, there are credit cards especially designed for people who have been through being broke. This is a limit card that trains the owner to pay debts on time and allows them to pay at their own time. This card will help you back on your feet over time. Here are three of the best cards available today.

The Classic MasterCard from the Orchard Bank

This card allows the client to spend as much as he pleases and at the same time makes him a wiser spender. The client is free to choose his due date, and the company follows up and sends reminders to customers when the settlement date is drawing near. Other benefits you would enjoy from this card is the support line that is open 24/7, a replacement card for emergencies and security to ensure that you will be able to rehabilitate your credit standing.

The Prepaid Visa CardfromAccountNow.

This card is very helpful for clients because it has a monitoring team that looks over the record of your past spending. As much as $5,000 can be borrowed by a client in a day charge free, they are also permitted to create checks online without any fee. This is recommended for people who are afraid of being indebted again.

The CreditOne Platinum Visa.

Are you a former platinum card holder who wants to keep their status in the high class society? Well, this card will allow you to retain your platinum standing while you rehabilitate your credit status. Your monthly spending will be recorded and monitored for only $75 annually. That’s not all, you will also avail travel insurance and your limit for loans will increase by itself as time passes.

Americans Still Do Not Have Chip and Pin Cards

For those who are going to travel outside the country this spring or summer, unfortunately, you are still unlikely to get a hold of the chip and pin credit cards, which is being used by the rest of the world.

If you’re going to a place and transact with a living person, then you can still use your current credit card. However, your current credit card will be useless if you are going to deal with a card-operated machine-only payment system.

Banks around the world currently make use of two credit card systems. The first is the stripe and sign system, which is common in the United States, and the second is chip and pin system, which is common in developed parts of the world like Canada, Europe and much of Asia.

In countries where the chip and pin system is used, traveling Americans can still use their stripe and sign cards such as American Express, MasterCard, and Visa. However, if the computerized system is either easier or the only way to pay, then stripe and sign cards cannot be used.

At present, banks in some of the countries give out dual cards, which come with a magnetic stripe and a chip at the same time.

However, although people who own airline-branded cards are more likely to travel than the general public, banks who issue these cards do not offer dual cards.

It is undeniable that there is a delay in the release of the chip and pin cards. However, it is definitely not because of cost, since the banks acknowledge that the chips cost lower than $1.

On the other hand, the good thing is that a growing number of credit cards either no longer charge a foreign exchange fee or charge only one percent. To check for the list of these credit cards, go online and visit websites like nerdwallet.com or cardhub.com.