Credit Cards may have been the reason your credit got the way it is. So you decided not to ever have a credit card again. I know credit cards are evil, but they are a necessary evil to establish credit. Let's assume you have messed up your credit report with credit cards in the past. So now you must re-establish your credit. What is the quickest way to establish new credit? Most people don know this but credit cards help your credit rating. So you need 1 to 2 cards reporting to your credit report. Ok, but back to the re-establishing credit after some credit issues. You need to go get a Secure Credit Card, this is the quickest way to get your credit score on the rise. Yes, you need to deposit money with the bank, but it's your money, and you quickly start the process of reporting good credit to all 3 bureaus. Here are some great secure credit cards I highly recommend that does not have a bunch of outrageous fees. 1. Orchard Bank 2. First Premier Bank
These two Secure Credit Cards usually start reporting to the Bureaus to establish good credit with in 60 days. These cards will quickly allow you to get your Credit Score in the right direction. I have talked about how to keep your balances low and what percentage of the allowed credit to charge up. You want to keep your balanced that is charged on your card 30% or less of allowed credit limit. While you are dong all of this, you can keep in the back of your mind, that every six months these credit card companies usually will allow you to ask for credit limit increases as long as you are in good standing. Remember once your balanced owed drop below 30% of your allowed credit limit, your credit scores will increase.
Who cares if you have had problems in the past because of credit cards, I am sure by now you have learned not to make the same mistake twice. Credit Cards are necessary to get the better rate on that loan; it is another way to show your ability to pay back a creditor that has extended credit to you. This is what Credit Reports are all about, who is reporting you, and your ability to pay back obligations. In a nutshell credit cards are necessary so if you don't have one I would get the process going.
But perhaps, more importantly, people will be beginning to suffer from the financial hangover January can bring. The strain of financial pressure over Christmas is probably about to catch up with a lot of us in the UK.
The additional expense of food, gifts and travelling at Christmas time often puts increased pressure on family finances, which can be made worse because people give in to temptation and run up credit card, loan, or overdraft debts.
Credit card companies also advertise in the run up to Christmas offering 0 per cent purchase or balance transfer deals, tempting people to run up credit card debts. There’s certainly nothing wrong with making the most of these 0 per cent deals on offer, but the most important part people tend to ignore or worry about only when the bill lands on their doorstep, is actually having the money to repay the debts you run up on a credit card.
If you think, come the end of the month, you’ll be struggling to repay all your credit card bills or overdraft debt then now is the time to take action.
Firstly do not bury your head in the sand; the debts will not magically disappear. If you are going to be paying interest on an overdraft or your existing credit card then probably the best idea is to transfer these debts onto a 0 per cent balance transfer credit card deal.
Next, do not, under any circumstances, continue to spend on your credit card or go back into your overdraft. Amazingly, something like 60 per cent of people who manage to transfer debt to a cheaper borrowing option then go on to borrow more and sink further into debt.
If you have serious amounts of debt and cannot get the whole amount transferred onto a 0 per cent balance transfer credit card then you could look at a consolidation loan. By taking out a personal loan or secured loan and paying off all your existing creditors, it could work out cheaper for you every month. However you need to be aware that you’ll have to spread the term of your loan over a longer time period in order to make your monthly payments less.
If, after looking at a consolidation loan or transferring your credit card balance to a cheaper credit card, you’re still worried about how much money you owe then you should really seek professional debt management advice.
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