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Getting A Plan For Getting Out Of Debt September 29, 2011

Posted by CredZoo - Tame Your Credit in New Credit Information, Tips For Good Credit.
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Once your credit has been damaged, it takes a plan of action to get it back on track again. Two important steps: 1. Enlisting the help of a professional NACSO Certified credit restoration service like CredZoo and 2. Get a plan for paying down your personal debt. So, here’s some help with both! First, contact CredZoo for your FREE Credit Consultation If you’re serious about discussing ways you can improve your credit score, we’re here to help. Our credit specialists are experienced, friendly, and will help you determine the best course of action to achieve your goals — all at no obligation or cost to you. Call us for your free consultation at 888-881-5333.

Second, order your debts from highest interest rate to lowest. You may find credit cards at the top of the list. It’s typical to see interest rates from 10% to 20% or more. Credit cards offered by stores often have the highest interest rates, so you might find these at the very top. Watch out for promotional rates ending, which they may do on the date promised when you enrolled, or earlier. Order your list from the highest interest rate (after tax) to the lowest. Pay the minimum to all debts every month. If you’re writing down your list, or using a spreadsheet like Excel, add a column next to each debt to list its minimum monthly payment. This is the amount you will pay towards each debt, except for the one account listed at the top of the list. To your debt with the highest interest, send all extra available cash.

Since it’s unlikely that you can earn more in savings than you can “earn” (reclaim) by paying off your debt, all your unused income after paying expenses (necessary and discretionary as you see fit) should be dedicated towards the debt account with the highest interest rate. Sounds simple, right? But sticking to it can be tricky. Make sure to repeat this each month – and keep yourself motivated to stay on the right track. Here’s a little interactive tool to calculate when you’ll be debt free: Getting Out Of Debt / Debt Reduction Calculator

 

Start Planning NOW For Holiday Spending September 9, 2011

Posted by CredZoo - Tame Your Credit in New Credit Information, Tips For Good Credit.
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It sounds crazy, right? Starting in August or September to plan for things you won’t buy for months? But these days with pennies being pinched as tight as they are, planning ahead is the best thing you can do! Listen to financial expert Mike Brescione and get some expert advice to help you prepare for the most wonderful, and expensive, time of the year!

Click on this link for the video:
http://www.ksee24.com/v/?i=128243983

Quick Tip: Co-signed Contracts September 4, 2011

Posted by CredZoo - Tame Your Credit in New Credit Information, Tips For Good Credit.
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When you agree to be a cosigner for someone else’s debt, you are guaranteeing to pay the debt if the primary borrower fails to pay the debt.  Think carefully whenever you cosign a contract because you may have to pay the full amount of the debt if the primary borrower does not pay even if they go through bankruptcy.  Additional late fees, collection costs, repossession fees are also guaranteed by you when you cosign.

   Example: You cosign a car loan with your child because they do not have the credit score needed to get the loan. A year down the road, the car is repossessed and there is a collection company calling you now for the remaining balance of the car. This is the first you will probably hear about the situation. You now have a repossession and a collection reporting and your scores have dropped 100 points. As a cosigner you are responsible for all balances and charges pertaining to that car loan.

Stay tuned for more great credit tips!

Brought to you by, our friend, Joe Farro, certified mortgage planner at Premier Capital Mortgage

Text To Join July 21, 2011

Posted by CredZoo - Tame Your Credit in About CredZoo.
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It’s Never Been Easier To Start Restoring Your Credit

Sign Up For CredZoo’s Information Packed E-Newsletter By Texting Us!

 

Text RESTOREMYCREDIT to 22828

 

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Read it whenever you feel like it!
You can unsubscribe at any time.

New Rules For Good Credit July 18, 2011

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Remember those long-standing guidelines like closing old credit card accounts, never maxing out cards and asking for lower interest rates? Well, according to MSN Money, you can forget them now.

The rules that credit card companies have to live by changed dramatically with the enactment of new regulations in 2010. Now some of the rules for consumers striving to maintain good credit are changing, too.

For the most part, cardholders would still do well to pay on time, keep their balances low and refrain from applying for too many credit cards at once. But some of the old guidelines may not always hold up, as credit card companies continue to adapt to the new environment and look for ways to run their for-profit businesses.

With the help of some easy — if often counterintuitive — steps, you can improve and retain healthy credit scores even in today’s credit environment. Here are five:

1. Open more credit cards

For years, experts warned that opening new credit cards hurts your credit score — not to mention enabling you to run up huge debts. That’s still true: The length of your credit history and new credit make up 15% and 10%, respectively, of FICO scores. But with credit issuers lowering credit limits left and right these days, having too few credit cards puts a much more important credit-score component at risk: credit utilization, or how much of your available credit you’re using. Credit utilization makes up 30% of your score.

2. Max out (some of) your credit cards

A quirk of credit score math makes it advantageous to max out certain cards. How? It’s a matter of what the issuer tells the credit bureaus.

Some types of cards don’t report credit limits to the credit bureaus. They include all charge cards from American Express and some high-end credit cards that are marketed as having no preset spending limit, such Visa Signature and MasterCard World. (These cards have credit limits, but cardholders can exceed them and must pay off the excess in full on the next bill.)

3. Don’t ask for a lower APR

In the old days, consumers were encouraged to call their credit card companies and ask for lower interest rates. “There really wasn’t a downside to doing that,” says Gerri Detweiler, an adviser with Credit.com.

“These days, if you call, you may trigger an account review.” Should that happen, and the credit issuer not like what it sees, it may cut your credit limit or actually hike your interest rate. This is where having multiple credit cards may come in handy, Detweiler says. “Don’t make that call unless you have a backup card where you could transfer that balance.”

4. Closed a card? Don’t pay it off

Under the old rules, interest-rate hikes applied to both your existing balance and future purchases. Since the Credit CARD Act went to effect, lenders have been limited to applying rate increases only on balances going forward. That said, if you closed an account before the law took effect to opt out of a rate hike – or have closed one since — you may not want to rush to pay off every last penny of the balance.

In a little-known quirk, FICO counts the credit limits of closed accounts toward utilization ratios only as long as there’s a balance on that account.

(From MSN Money)

The WORST Credit Cards May 12, 2011

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 To identify the world’s worst credit cards, MSN Money writer Liz Pulliam Weston consulted with three of the countries top experts: Curtis Arnold of CardRatings.com, Justin McHenry of Index Credit Cards and Bill Hardekopf of LowCards.com

Their top nominations for the the WORST credit cards are….drumroll please….

  • Macy’s Card

Cards offered by retailers and specialty stores are usually a bad deal, but Macy’s still manages to stand out.

“Almost without fail, (retail) cards charge exorbitant interest rates. The worst offender I know of is the Macy’s credit card, with its 23.99% interest rate,” McHenry said, “but cards from J.C. Penney, American Eagle Outfitters, Gap, Brooks Brothers, J. Crew and Dillard’s all come in at rates over 20%.”

Many people apply for retail cards to get a discount on their purchases, typically 10% to 20% off. But you can often get the same benefits and a better overall deal by applying for a store card that’s affiliated with a major credit card brand.

“If you really want a store credit card, try to get a store card associated with Visa, MasterCard or American Express — those cards generally have interest rates lower than the store-only credit cards,” McHenry said. “For example, I just got a Banana Republic Visa with an interest rate of 14.24%. Compare that to Banana Republic’s store-only card, which charges a rate of 21.9%.”

  • Money Return Platinum Plus Visa from Bank of America

If you pay your balance in full, cards that offer cash rebates are usually a terrific deal… Not this one.

Oh, the terms look sweet at first: no annual fee, 0% for six months on balance transfers and a whopping 10% cash rebate.

You get the 10% cash back, however, only if you carry a balance. And the annual percentage rate for carrying a balance ranges from 9.99% to 19.99%.

“So you pay up to almost a 20% APR to earn (back) only 10% of your interest that you pay out of your pocket,” said Arnold, of CardRatings.com. “Doesn’t take a math genius to figure out that this is a lose-lose proposition.”

You can read more of Liz’s findings on her money basics blog, here!

Why Check Your Credit Report? And How? May 4, 2011

Posted by CredZoo - Tame Your Credit in About CredZoo, Tips For Good Credit.
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Your credit report contains information about where you live, how you pay your bills, and whether you’ve been sued or arrested, or have filed for bankruptcy. Credit reporting companies sell the information in your report to creditors, insurers, employers, and other businesses that use it to evaluate your applications for credit, insurance, employment, or renting a home. The federal Fair Credit Reporting Act (FCRA) promotes the accuracy and privacy of information in the files of the nation’s credit reporting companies. Some financial advisers and consumer advocates, like CredZoo, suggest that you review your credit report periodically. Why?

* Because the information it contains affects whether you can get a loan — and how much you will have to pay to borrow money.

* To make sure the information is accurate, complete, and up-to-date before you apply for a loan for a major purchase like a house or car, buy insurance, or apply for a job.

* To help guard against identity theft. That’s when someone uses your personal information — like your name, your Social Security number, or your credit card number — to commit fraud. Identity thieves may use your information to open a new credit card account in your name. Then, when they don’t pay the bills, the delinquent account is reported on your credit report. Inaccurate information like that could affect your ability to get credit, insurance, or even a job.

How to Order Your Free Report

The three nationwide credit reporting companies have set up one website, toll-free telephone number, and mailing address through which you can order your free annual report. To order, visit annualcreditreport.com, call 1-877-322-8228, or complete the Annual Credit Report Request Form and mail it to: Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281. You can use the form in this brochure, or you can print it from ftc.gov/credit. Do not contact the three nationwide credit reporting companies individually. They are providing free annual credit reports only through annualcreditreport.com, 1-877-322-8228, and Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281.

You may order your reports from each of the three nationwide credit reporting companies at the same time, or you can order from only one or two. The law allows you to order one free copy from each of the nationwide credit reporting companies every 12 months.

You need to provide your name, address, Social Security number, and date of birth. If you have moved in the last two years, you may have to provide your previous address. To maintain the security of your file, each nationwide credit reporting company may ask you for some information that only you would know, like the amount of your monthly mortgage payment. Each company may ask you for different information because the information each has in your file may come from different sources.

Obtaining your free credit reports for CredZoo professionals to review is the first step to improving your credit score! You begin by forwarding copies of your credit reports to us from all three of the major credit bureaus. Keep in mind that a recent law which aids in resolving inaccuracies of credit reports, forces the credit bureaus to correspond only with you, not your credit repair firm. Learn more about CredZoo’s credit restoration services right now by clicking here!

(Official Information Courtesy Of The Federal Trade Commission)

The Role Of Debt April 25, 2011

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The final installment – Part VI in our “How to Manage Debt & Credit” posts: The Role Of Debt

Today, carrying installment debt is almost a fact of life. Mortgages, car loans, or small-business loans (to name a few) are part of almost everyone’s life. On the other hand, carrying credit card debt is usually not a good idea. At interest rates of 16% and up, it’s hard to justify keeping savings that could pay off that 18% department-store credit card in the bank at 2%.

Debt and credit play increasingly important roles in our lives. As the aging Baby Boomers get closer to their peak earning years, many are realizing the need to reduce debt and increase savings. Even though analyzing your spending habits and creating a budget to address your debt may seem a little overwhelming, the simplicity of the philosophy of the Depression era still stands: Never spend more than you earn. Once you have come to grips with this basic fact, managing your debt will become far easier and more rewarding.

Summary

  • Installment debt means the loan is paid off in a specified period of time by making predetermined payments periodically.
  • Revolving credit is a line of credit that is instantly available through use of a credit card (and sometimes a check).
  • As you pay down your debt in a revolving line of credit, the minimum payment is also reduced, thus extending your payoff period and, consequently, the interest you pay.
  • Spending more than you earn in any given period is a dangerous practice at best, but doing it over an extended period of time can be financial suicide.
Thanks to Yahoo! Finance

Using Credit Wisely April 14, 2011

Posted by CredZoo - Tame Your Credit in About CredZoo, Tips For Good Credit.
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Part IV in our “How to Manage Debt & Credit” posts: Using Credit Wisely

To use credit intelligently, start by examining the terms of the card(s) you are currently using. Keeping track of your cards, their rates, and your current balances will help you to be aware of how you use credit cards. Increased competition in recent years has led some credit card companies to offer enticing features to attract new cardholders, including no annual fees and low interest rates for an introductory period. (And credit card companies sometimes will give their introductory rates to existing cardholders so that they won’t transfer their balances to another credit card company.)

CredZoo has written a lot on this subject, and has much to offer about credit, using credit wisely and – of course – repairing credit!

Revolving Credit April 13, 2011

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Part III in our “How to Manage Debt & Credit” posts: Revolving Credit (AKA – Credit Cards)

A revolving line of credit, also called “open-ended credit,” is made available to you for use at any time. Examples of revolving credit are credit cards such as Visa, Mastercard, and department store cards. When you apply for one of these cards, you receive a credit limit based on your credit payment history and income. When you use the credit line, you must make monthly minimum payments based on the total balance outstanding that month. Some lines of credit will also have an annual account fee.

 

While revolving credit is a convenient way to borrow, it can also become an endless pit of minimum payments that barely cover the interest due. Many cards charge annual rates of interest of 18% or higher. As you pay off your debt, the minimum payment is also reduced, thus extending your payoff period and, consequently, the interest you pay. Paying just the minimum due on a $2,000 credit card loan could mean making monthly interest payments for 10 or more years!

Revolving credit, in addition to being convenient, eliminates the need to carry a lot of cash and can help establish you as a creditworthy risk for future loans. The itemized monthly statements also can help you track your expenses. But some people can easily yield to the temptation that the convenience of credit cards offers. Impulse buying, failing to compare costs, and purchasing large items you can’t afford are all downfalls brought on by always available purchasing power. Spending more than you earn in any given period is a dangerous practice at best, but doing it over an extended period of time can be financial suicide.

Installment Debt vs. Revolving Debt
Lower interest rates and an amortizing repayment schedule can make installment debt a much cheaper alternative to revolving credit.
Installment Revolving
Beginning Balance $2,500 $2,500
Interest Rate 10% 18.5%
Years to Repay 4 30*
Interest Cost $544 $6,500
*Paying 2% minimum monthly payment.
Sources and Costs of Debt
Source Type of Debt Cost
Banks and Credit Unions Personal, secured Low
Personal, unsecured Moderate
Mortgage Low
Credit Card Low to High
Mortgage Companies Mortgage Low
Department Stores Revolving High
Insurance Companies Personal, unsecured High 

(Thanks To Yahoo Finance)