Starting off your adult life with a strong credit score can make a huge difference to how financially independent you are able to be from your parents, but the road to building that score can sometimes seem impossible. How can you build a credit score if you’re too young, or ineligible, for home loans, auto insurance or personal loans? Credit cards can be a great solution to this and can also open up access to upgrades to platinum cards earlier on than if you waited to build your credit score. [Read more...]
Press Release: Fed Prime Rate Recommending Small Business Credit Cards
August 31, 2010 By 1 Comment
Are you currently in the market for a credit card for your small business? Are you having a difficult time getting access to credit? If so, then this article may be of interest to you. There are some pretty good cash back cards with a 0% introductory APR. So, take a look and see if it meets your needs.
Credit Card Companies Are Up To Their Old Tricks
December 22, 2009 By 3 Comments
I decided to google credit cards today and see what kinds of offers came up for individuals with poor credit scores. I was shocked by some of the offers that I saw. These cards won’t help individuals with bad credit improve their credit; these cards will only help their credit to get worse. These are some of the worst offenders.
Next Millennium Mastercard- This is a secured credit card which is supposed to allow individuals to rebuild their credit. I am normally a fan of secured cards for people with bad credit because the savings account keeps you from going over your credit limit. That is not true of the Next Millennium card. Next Millennium charges a $99.00 processing fee to open the account and a $59.00 annual fee. Numbers of people have complained to the Better Business Bureau about being charged the processing fee even though they did they did not fully complete the application. Other people have complained about mailing the company money and receiving no credit for their payments. The company’s contact information is hidden which makes it near impossible to contact them about their fraudulent practices. If you ever do receive the card your interest rate is a minimum of 19.5%. Next Millennium offers no grace period which makes it virtually impossible to pay your balance down to zero. This is probably the worst secured card on the market.
First PREMIER Bank- First PREMIER Bank offers the First PREMIER Bank Gold Credit Card, Centennial Card and the Aventium Card. First PREMIER’s motto is U + Premier are stronger together. So let’s say you believe this and apply for a First PREMIER card. Your initial credit limit is $250 before fees. What are the fees? As soon as you receive the card you are billed for a $95.00 program setup fee, $48.00 annual fee, $29.00 servicing fee, $84.00 monthly servicing fee billed at a rate of $7.00 monthly. Add all these fees up and your available credit is $71. But when you add in the servicing fee over a full year your available credit is actually $-6.00. That’s just the beginning of the fees. If you want to schedule autodraft payments that will cost you $11. If you receive a credit limit increase, you will be charged $25. Do you want to view your account online? That will be an additional $3.95. This card boasts the highest fees of any credit card. Based on all of the fees that First PREMIER Bank charges I am surprised that they do not send the card COD.
Since new credit card regulations are capping fees on these predatory lenders, they are going to lower fees and increase interest. First PREMIER is offering cards with an interest rate close to 80%. That’s just plain ridiculous. I would say its better to have no credit card then these cards.
Credit card companies are putting the squeeze on loyal customers
November 29, 2008 By 12 Comments
At a time when banks are losing money due to toxic assets, they are dropping the hammer on the already pressured consumer. The credit card divisions of the major banks in the US are trying to make up for loan losses by increasing credit card interest rates. Banks are raising rates on customers regardless of payment history. Customers that pay on time have seen their credit card rates go up as much as 5% annually.
I find this behavior totally unjust. They should not be punishing customers who pay their bill to cover losses from customers who do not. This is a terrible business practice. So what can you do about it?
1. Stop using the card immediately. You don’t want to have future charges at the higher interest rate.
2. Write a letter. State your displeasure with the higher rate and request a lower rate. I used to call but calling can be a hassle. I found myself transferred to different customer service reps each time who knew nothing about my case. I write a letter when I have a complaint so that there is written documentation on file. I have gotten better results by writing a letter.
3. Be prepared to leave. A lot of people threaten to leave their credit card company but do not follow through on it. If your credit card company refuses to lower your interest rate, it may be best to leave. They obviously do not value your business and you would do better to go elsewhere. Most credible companies hate to lose a loyal paying customer.
4. Transfer your outstanding balance. If you have a solid payment history and decent credit score you will find a better rate. Check out websites such as bankrate.com. They offer lists of credit card companies nationwide and their current interest rates.
Happy Thanksgiving!
November 27, 2008 By Leave a Comment
In honor of Thanksgiving I will list the 5 biggest turkeys of the year:
1. Predatory Lenders – Lending companies and individuals that gave high fee, high interest loans to borrowers that they knew could not afford the loans. Many of these lenders have gone out of business. (Ameriquest, New Century Financial)
2. Greedy Executives – As mentioned in a previous post, executives were excessively compensated for their inability to manage risk.
3. Credit Card Companies - How are credit card companies helping during these difficult economic times? By burying the already leveraged consumer with even more debt. They are raising rates on existing customers.
4. Regulatory and ratings agencies – Organizations like the SEC, Office of Thrift Supervision that inadequately monitored the systemic risk in the financial markets. Ratings agencies like Moody’s, Standard and Poor’s that fraudulently gave high ratings to low grade debt.
5. Minnesota Timberwolves – This isn’t finance related but how could you trade Kevin Garnett?
5 Ways to Live Debt Free
November 17, 2008 By 3 Comments
Use these 5 ways to live debt free.
1) Renegotiate your high interest rate loans.
High interest credit card debt can be renegotiated with your credit card company. You can call your credit card company and negotiate a lower interest rate. If your company refuses you can threaten to transfer your balance to a lower interest credit card. Many times this will make the company grant your request. Credit card companies do not want to lose your business to a rival company. If that doesn’t work then transfer the balance to another card with a lower rate. High interest automobile loans can be refinanced at your local credit union in as little as nine months. Lowering your interest rate from 18% to 8% is the same as receiving a 10% return on your money. It allows you to keep more of your own money.
2) Live within your means.
Attitudes and habits that condone overspending can really hurt your future goals of achieving financial security. Habits such as spending money consistently on new clothes, shoes and jewelry. You would be surprised at how quickly entertainment expenses such as buying movies, music, going out to eat add up. Always having to have the latest car for example can also hinder your ability to save. These types of habits will keep a person debt ridden for years. Too many Americans already live paycheck to paycheck. It is critical to adopt the perspective of having your money work for you. Whenever you save, your money is earning interest and working for you. Whenever you are spending, you are working for your money. Always remember that just because you have the credit to pay for something does not mean that you can afford it.
3) Never pay the minimum.
Paying only the minimum will keep you in debt for years. It also ensures that you will pay thousands of dollars in interest to your credit card company. For example, if an individual with an $8,000 credit card balance at an 18 percent interest rate makes only the minimum payment. It will take him over 30 years to pay off the balance. Paying an extra $20 or $30 per month can greatly reduce your balance over time. Remember that you only agree to pay back the principal when you borrow money; never the interest.
4) Watch out for hidden fees.
Lenders make a fortune by charging fees to consumers for any violation of the account agreement. These fees are typically located in the small print of your agreement. Companies charge fees for late payment, overdrafts, account maintenance, inactivity and more. Be sure to read your agreement carefully to avoid hidden fees. One late payment can change your interest rate to the highest rate allowed by law.
5) Create a safety net.
Remember to save money while you are paying off your debt. Sometimes people will pay their debt off and have no remaining cash. Then they are forced to begin using their credit all over again. The best way to create a safety net is to make a firm commitment to save a certain amount of money each month. Pick an amount that you will be able to stick to each month. A good rule of thumb is to begin by saving 10% of every dollar that you receive. Automatic deductions to these accounts can ensure that you make regular contributions at the same time each month.
