The term credit can mean many things. For most people, it is the ability to borrow today and pay later. The idea of “credit-worthiness” defines our personal finances, and reaches out to all parts of our financial lives. Credit can be an accounting term. You can talk about credit cards, your credit history, your credit score, or the three credits you got in college for taking Bowling. This page is the credit nerve center of ThinkGlink.com. From this page you can learn more about what credit means and how having good, bad, or mediocre credit affects your personal finances.
Dave Ramsey says credit scores are irrelevant. Are they? A WSB listener claims Dave Ramsey says to get out of debt and that FICO credit scores are not what they seem. Dave Ramsey says FICO credit scores are the "I love debt" score because there's no way to get a great FICO credit score without getting into debt and staying in debt. While I agree with a lot of what Dave Ramsey says, I disagree with that premise. Here's why I think FICO credit scores are relevant to your life today.
Trouble in the stock market and the economy recently has affected credit card companies just like any other business. You may think that if you pay your credit card bill on time every month and never go over your limit, that you're safe. Credit card companies may change the terms of your credit card at any time. What kinds of changes can credit card companies make? Does your behavior affect what action a credit card company takes on your credit limit?
Before you even think about buying a home, you should ask yourself two questions: "What's my credit score?" and "How do I raise it?" Knowing your credit score will help you negotiate a good interest rate on your mortgage, and if you can raise your score, you'll get a loan with a lower interest rate.
The only site where to get an annual free credit report is annualcreditreport.com. Ads that offer a free annual credit report aren't free and will still ask for a credit card number. You credit score isn't free, and usually costs about $7 along with the annual free credit report.
Credit repair scams abound in economic times like these: A shaky economy, record levels of foreclosures, a rising number of bankruptcies, credit card delinquencies, and late mortgage payments. Repairing bad credit takes more than paying a $1,000 fee. Beware of those promising to repair your credit by getting you a new Social Security number.
If you're thinking about getting a new credit card make sure to read all the terms you can prior to applying. You don't want to get blindsided after you have the card. It's easier to read the terms in advance than close the card and get dinged on your credit history. Credit card interest rates can zoom up at a moment's notice, but you can take steps to keep your rate low.
A low credit score will lead to challenges when trying to get a home loan. The interest rate will depend on what kind of credit you're looking for. It's also possibly that you won't qualify for a loan with a credit score of 500.
A mother let her son use her credit card to help set up his new home and now she is in significant financial trouble. You should never let anyone use your credit card without your permission. If the credit card debt is bigger than her income, her only solution might be to file for bankruptcy.
After going through a divorce and bankruptcy you may find it difficult to keep making mortgage payments on a property that's not a primary residence, even if it's rented out. To prevent your credit from becoming more bad, you should try to keep making mortgage payments. Perhaps your former spouse, who's also paying part of this mortgage, can help you out until you have more income. Despite bankruptcy and bad credit, it's not a time to give up.
A woman diagnosed with breast cancel neglects to pay some of her bills. Even during illness or hardship, yo uare responsible for paying your bills on time. Think about setting up automatic payments to make sure they're on time. If your late bills have already been reported, work with the creditors to create a payment plan or your credit score will suffer.