Archive for category: Credit Repair

The bad news: you have bad credit. 

The good news: you can still get a credit card. 

About one-third of all Americans have a credit score that falls beneath 601. That’s why so many credit companies have made their cards available to those with lower scores.

When you have bad credit, you should look for a card that allows you to start building it back up again. Choosing one of our suggested credit cards can help you raise your credit score as long as you make the required payments. 

Here are some of the best credit cards for bad credit: 

Discover It Secured

You might not be able to obtain an unsecured credit card yet, but that shouldn’t stop you from getting a secured card with a lot of great features. The Discover It Secured card has many perks similar to an unsecured card. Plus, the security deposit is only $200, and you won’t even have an annual fee. 

One of the best parts about the Discover It card is that you’ll receive 5% cashback on different purchases. Cashback conditions change quarterly, but often include grocery stores, gas stations, restaurants and more. You’ll also benefit from 1% cashback on every purchase you make.  

Capital One Secured Mastercard

Easily rebuild your credit using a Capital One Secured Mastercard without having to pay an annual fee. Better yet, this credit card for bad credit only requires $49 down for $200 worth of credit. 

As long as you use the card responsibly, you might even get your deposit refunded along with a higher line of credit. All you have to do is make sure that you pay your bills in a timely manner. If you’re unsure about the status of your credit score, don’t forget to check it using Capital One’s Creditwise. 

OpenSky Secured Visa Credit Card

The OpenSky Secured Visa Credit Card is made specifically for people with poor credit, as they don’t even check your credit when you apply for their card. You choose your credit line by how much you put down on your refundable deposit–the amount can range from $200-$3,000. 

OpenSky also sends your credit report to each major credit bureau, allowing you to check it often. A phone notification from their app won’t let you forget your monthly minimum payment. 

Milestone Gold Mastercard

Have a previous bankruptcy? No problem.

The Milestone Gold Mastercard won’t exclude you. That’s what makes the Milestone Gold Mastercard one of the best credit cards for bad credit. 

Your annual fee is determined by a prequalification assessment. It won’t hurt your credit score and calculates your annual fee based off of it.

Your annual fee could be anywhere from $35-$75 for the first year. After that, it’ll increase to $99. Although you might also be required to pay an opening fee, you can be sure that it won’t be more than $75. 

Merrick Bank Double Your Line Visa

Apply for a Merrick Bank Double Your Line Visa and get prequalified in less than one minute. As the name of this card suggests, it allows you to double your line of credit. After making your minimum payment every month for seven months, your credit line will be raised automatically. 

You’ll also benefit from online management tools, as well as the ability to check your credit score. With $0 fraud liability, you’ll be safe from any unapproved transactions. 

AvantCard

When you’re searching for credit cards for people with bad credit, it’s important to choose wisely. That’s why you should consider the AvantCard.

The AvantCard is one of the most convenient bad credit credit cards. The application process is simple and doesn’t take long. Using an AvantCard to better your credit score is ideal–you won’t be hammered with hidden fees, and you’ll have protection from fraud. 

Total Visa Unsecured 

You’re probably reluctant to get another credit card after having an experience with bad credit. However, the Total Visa Unsecured can help you reestablish your credit score.

There may not be any fancy features on it, but this is one of the best cards for people with bad credit. Instead of spending frivolously, you can work on becoming more frugal and avoiding items you can’t afford. 

When you first get your card, your credit limit will be $300. This prevents you from using it on huge purchases. Try to charge about $100 every month, and make sure to pay all of it off–otherwise, you’ll be hit with a high APR. 

Green Dot Primor Visa Gold Secured

A Green Dot Primor Visa Gold Secured credit card can be your solution if you’re unable to obtain a credit card. You don’t have to have a good credit score to get this card–a person with any credit score is welcome to apply. Fortunately, there aren’t any application or processing charges either. 

You’ll be given a credit line ranging from $200-$5,000. With a low 9.99% interest rate and no penalty fees, you should be able to rebuild your credit in no time. 

Indigo Platinum Mastercard

The Indigo Platinum Mastercard is another one of the most helpful credit cards for poor credit. You won’t even be disqualified for bankruptcies or for a bad credit score. 

Quickly apply without it having an effect on your credit score. Not only is this card protected from fraud, but it can be used at 35 million areas around the world. 

Credit One Bank Unsecured Visa

Who doesn’t love getting cash back? With Credit One Bank Unsecured Visa, you can get 1% cashback on certain purchases including gas, internet services, cable TV, groceries and more. 

You’ll also have the ability to check your credit score status through their website. Once you’ve consistently paid back your bills, you’ll qualify for a credit line increase. Luckily, you also won’t be accountable for any unauthorized transactions.  

The Bottom Line: Credit Cards for Bad Credit

Don’t get discouraged by your credit score. You don’t have to keep getting rejected by multiple credit card companies. Instead, choose one of these credit cards for bad credit. 

These cards make it possible to slowly rebuild your credit. Soon, your score will be back up and you’ll no longer have to suffer from bad credit. 

Want to know some of the fastest ways to help boost your credit score? Check out our article for more tips. 

When it comes to financial literacy, many Americans are struggling to keep up.

Millions of Americans have at least one credit card. But, the majority of these people are clueless when it comes to using these cards effectively.

Many of these people are also unaware of how to use their debit card properly. They might even find themselves asking questions like, “do debit cards affect a credit score?”

If you’re guilty of asking questions like this, keep reading. Explained below is everything you need to know about whether or not your use of a debit card can influence your credit score. 

Debit Cards Vs. Credit Cards

First things first, let’s clarify the difference between a debit card and a credit card.

In order to get a credit card, a lender has to approve you for a specific credit limit. 

Whenever you use your credit card, you’re borrowing against that credit limit. You will also have to pay interest on your credit card balance if you do not make your payments on time or do not make complete payments.

A debit card, on the other hand, takes money out of your checking account whenever you use it. With a debit card, you’re spending money you already have. With a credit card, you’re borrowing money from your bank or credit union.

Do Debit Cards Affect a Credit Score?

The short answer to this question is, “no, they do not.” There are lots of factors that affect your credit score, but your debit card usage is not one of them.

Because you’re using the money you already have when you swipe your debit card, those purchase do not affect your credit report. Essentially, you’re not building credit when you’re simply spending your own money.

Which Factors Do Affect Your Credit Score?

So, debit cards don’t play a part in raising or lower your credit score. But, which factors do have an influence? 

There are lots of things that can raise or lower your credit score, including the following:

Payment History

Your payment history has a major effect on your credit score. If you’re not making credit card payments on time, or if you’re skipping them altogether, you’re going to have a hard time improving your score.

Credit Utilization

Your credit utilization is the amount of money you’ve charged relative to your credit limit. For example, if you have a $10,000 credit limit and you’ve charged $1,000, your credit utilization ratio is 10 percent.

Generally speaking, it’s a good idea to keep your credit utilization as low as possible — below thirty percent is ideal.

The Length of Your Credit History

How long have you been using credit cards or borrowing money from your bank or credit union? The longer your credit history, the better your credit score.

This is why it’s difficult for individuals who are new to credit to have high credit scores.

Credit Mix

The term “credit mix” refers to the different types of credit on your credit report. For example, you might have two credit cards, a mortgage loan, and an auto loan.

Generally speaking, if you have a diverse credit mix (and you’re making all your payments on time), you’ll have a higher credit score.

Lack of a Credit Balance

Using your credit cards too much can be problematic, but so can using them too little. If you never use your credit cards, you don’t have an opportunity to pay them off.

This, in turn, hinders your ability to build credit.

Your credit cards may even be canceled if you don’t use them often enough — and, this definitely isn’t good for your credit score.

How to Improve Your Credit Score

You might be relieved or disappointed to learn that your debit card usage does not impact your credit score.

While you won’t boost or lower your credit score with your debit card, there are lots of other steps you can take to get that score up.

Some specific strategies you can utilize include:

Get a Secured Credit Card

A secured credit card is kind of like a credit card with training wheels. The training wheels, in this case, are a security deposit that you pay before you can use your card. This security deposit acts as your credit limit.

Keep Your Credit Balance Low

Try to pay your credit card balance off in full each month. There’s no benefit associated with leaving a balance on your credit card — you’ll likely just end up paying more money in interest if you do this.

If you can’t pay your entire credit card balance, at least pay off the majority of it to keep it as low as possible.

Make Your Payments on Time

It’s also important to make sure you’re paying your credit card bills and making your loan payments on time. If you have a hard time with this, set reminders on your phone or set up automatic payments.

Monitor Your Credit Report

Keep in mind that you can get a free copy of your credit report from each of the three credit bureaus (Experian, TransUnion, and Equifax). Take advantage of this opportunity and make sure there aren’t any errors that are affecting your credit score.

Be Selective with the Accounts You Close

Generally speaking, it’s not a good idea to close credit accounts, especially old accounts. But, if you have cards that you rarely use (especially cards that have a high annual fee), you might want to close them so you don’t get penalized for inactivity. 

Looking for More Tips to Improve Your Credit Score?

Clearly, the answer to the question, “do debit cards affect a credit score?” is a resounding, “yes.”

As you can see, there are lots of things you can do to use your debit card to boost your credit score.

Do you want to learn more about how to improve your credit score?

Start by checking out the credit repair section of our website today. It’s full of tons of tips and tricks to help you manage your finances effectively.

Do you have a bad credit score? When you’re dealing with bad credit or lots of debt, it’s easy to feel as though it’ll never get better.

Don’t lose hope, though. Lots of people have rebuilt their credit after making mistakes, and you can, too. 

Now, you might be wondering, “how long does it take to rebuild credit?”

There’s no one-size-fits-all answer to this question. The amount of time it takes to rebuild your credit depends on a lot of factors.

Read on to learn more about the credit rebuilding process. This information will help you figure out how long it’ll take you to rebuild your credit.

Factors That Influence Your Credit Score

Before getting into the amount of time it takes to rebuild your credit, it’s important to understand the various factors that influence your credit score.

Many people are unaware of all the different factors that can raise and lower their scores. But, once you’re aware of these, you can identify the problems that are affecting your score and start making changes to rebuild your credit.

 Some factors that have the greatest influence on your credit score include:

• Whether or not you’ve been making credit card and loan payments on time
• Errors on your credit report
• The amount of money you’re paying off with each payment (are you making just the minimum payment or paying off the full balance?)
• The number of open credit lines you have (this includes mortgages, credit cards, and student loans)
• Your credit utilization ratio (this is the amount you’ve borrowed from your available credit)

Frequent late payments, credit report errors, paying only the minimum payment, having several open lines of credit, and having a high credit utilization ratio can all have a negative impact on your credit score.

So, How Long Does It Take to Rebuild Credit?

Okay, you understand that there are lots of factors that influence your credit. But, how long will it take you to address these issues and boost your score?

Generally speaking, it takes about a year to recover and rebuild your credit. Keep in mind, though, that everyone has a different definition of what it means to rebuild their credit.

For example, if you currently have a bad credit score and want to work your way up to an excellent one, it’s going to take some time. We’re talking about raising your score several hundred points, after all. But, if you’re just trying to raise your credit score from “poor” to “fair,” you’ll be able to raise it more quickly.

Your credit history matters, too. If minor mistakes have been affecting your score, they can be rectified more easily. More serious mistakes, though, will take longer to erase and will have a negative impact on your credit score for a longer period of time.

Remember to be patient. It took a while for your credit score to get to the point it is now. It will take a while for you to bring it back up, too.

Tips to Rebuild Credit Faster

If you want to speed up the process of rebuilding your credit, you might want to try implementing some of these strategies:

Review Your Credit Report

Start by obtaining a copy of your credit report. You can get a free copy from each of the three credit bureaus.

Evaluate your credit report and look for any errors that are negatively impacting your score. Incorrect personal information, old debts, or unauthorized accounts or credit checks can all have an effect on your score.

If you notice any errors, reach out to the credit bureaus and work on getting them fixed.

Look for other factors that could be influencing your score, too. This includes late payments or accounts that have gone to collections. Once you figure out all the things that are hurting your credit score, you can start working on changing them.

Catch up on Late Payments

Late payments can have a serious effect on your credit score.

If you have a hard time keeping track of when your payments are due, try setting alarms on your phone or writing the due dates down on your calendar.

If this doesn’t work, consider setting up automatic payments. That way, you won’t have to worry about paying your credit card bills and loan payments on time.

Of course, you’ll need to make sure you have money in the bank at all times. If the payments can’t go through because of insufficient funds, you’re only going to end up with more credit damage.

Avoid Adding to Your Debt

While you’re working on rebuilding your credit, it’s a good idea to avoid taking on additional debt.

Don’t open any new credit accounts or apply for any new loans. Avoid using your credit cards, too.

Instead, focus solely on paying down your debt and paying off those remaining credit balances.

Consider Using a Secured Credit Card

If you don’t want to add to your debt but want another way to continue building your credit, you might also want to apply for a secured credit card. 

With a secured card, you’ll pay a security deposit that will act as your line of credit.

Thanks to the security deposit, you’re almost always guaranteed to be approved for a secured credit card. They’re also less expensive for people who have bad credit, and they’re identical to unsecured cards on a credit report.

As long as you don’t max out your spending limit and pay the monthly bills on time, this will help you build up your credit more quickly and with very little risk.

Looking for More Credit Rebuilding Advice?

You now have a more detailed answer to the question, “how long does it take to rebuild credit?” But, you probably still have questions about how you should go about rebuilding your credit.

If you’re not sure how to go about improving your credit score, check out the credit repair section of our website today.

You’ll have access to tons of great articles that will help you boost your credit score and gain financial freedom once and for all.

Approximately 68 million Americans (30 percent of all scoreable people) have a “bad” or “poor” credit score.

If you’re one of them, you might have a hard time making large purchases like a car or a home.

Buying a house with bad credit is possible. But it can be quite difficult.

If you want to avoid the hurdles associated with this process, consider improving your credit before you try to buy your dream home.

Read on to learn everything you need to know about improving your credit.

Why You Should Avoid Buying a House with Bad Credit

In some cases, you can still get approved for a home loan even if your credit score is less-than-ideal.

At the time, though, just because you can do something, that doesn’t always mean you should.

If you buy a house with bad credit, you may get approved for a home loan, but it will likely come with very high interest rates and fees.

You may also have to make a very large down payment. For example, if you have a credit score of less than 580 and want to qualify for an FHA loan, you’ll have to pay a 10 percent down payment. 

If you can’t afford a large down payment or don’t want to deal with astronomical rates and fees, it’s probably a good idea to table the idea of buying a home until you can boost your credit score. 

How to Improve Your Credit Score

Are you ready to start improving your credit score? Are you unsure of where to begin? Start with the following credit repair strategies:

Check Your Credit Report

One of the first things you should do if you’re interested in improving your credit score is to obtain a copy of your credit report. This will tell you your credit score, and it will also let you know if there are any errors that are bringing your credit score down.

Some common errors that can impact your credit score include:

• Inaccurate personal information (name, address, Social Security number, etc.)
• Not all credit accounts are being reported
• Not all payments are being recorded
• Old debts are still showing up 

You should also be on the lookout for accounts or credit applications that you don’t recognize. These fraudulent accounts or applications could be negatively affecting your score.

Make All Your Credit Card Payments on Time

Do you have a hard time keeping up with your credit card payments? Are you regularly making late payments or forgetting them altogether?

If this is the case, you’re going to have a hard time improving your credit score.

Go through all your credit card agreements and find the due date for each bill. Then, set reminders in your phone or write them down on your calendar so you don’t forget to pay them.

You can also set up automatic payments to take the guesswork out of the equation.

Avoid Adding to Your Debt

If you have a lot of credit card debt that’s dragging your credit score down, start working on paying it down. To do this, stop using your credit cards. That way, you won’t continue adding to your debt. 

It’s also a good idea to try and pay more than the minimum payment your lender requires.

If you only make the minimum payment, it will take you a very long time to improve your credit score, and you’ll end up paying a lot more in interest.

Be Cautious When Closing Old Accounts

In many cases, it’s a good idea to avoid closing old accounts, even after you’ve paid them off.

When you close accounts, you decrease the amount of credit that is available to you. This, in turn, can negatively affect your credit score by raising your credit utilization ratio. 

There are some accounts that you may want to consider closing, though.

For example, credit cards you don’t use regularly that have an annual fee can eat a hole in your bank account. And, credit cards with unfavorable terms or high interest rates might be doing you more harm than good.

Avoid canceling your oldest credit cards, though. These cards have the longest history and will be most beneficial to your credit score.

Avoid Additional Credit Applications

Every time you apply for a new credit card (including store credit cards), your credit score takes a hit. This hit occurs whether or not you get approved, and it impacts your score for a full year.

It’s true that this hit is small — usually between three and five points. But, 3-5 points can be the difference between one qualifying credit score and another. Remember, too, that those points add up if you’re applying for multiple credit cards in a short period of time.

Don’t worry about the credit checks lenders perform when you’re applying for a home loan or undergoing a background check. These are soft inquiries, and they do not affect your credit score at all.

Improve Your Credit Utilization Ratio

You might assume that you can charge as much as you want to your credit cards each month, as long as you’re paying off the balance in full. This isn’t actually the case, though.

If your credit utilization ratio is too high (i.e., you’re charging a large percentage of your total credit limit), your credit score can take a hit. 

Try to keep your credit utilization ratio to 30 percent or less. If you have a credit card with a $2,000 limit, for example, try to avoid charging more than $600 per month. 

If you know you’ve charged more than that 30 percent, try to pre-pay a portion of the balance. That way, you’ll keep your credit utilization low and will boost your credit score.

Improve Your Credit Score Today

As you can see, it’s best to focus on improving your credit score instead of buying a house with bad credit.

These tips will get you pretty far when it comes to getting a better credit score. If you need more advice, though, we’ve got you covered.

Check out the credit repair section of our website today for tons of great articles that will teach you everything you need to know about managing your finances and building up your credit score.

A recent study found that 2 in 3 patients cannot pay off their medical bills. In 2016, for bills averaging less than $500, 68% of individuals did not make payments on time. By 2020, this number could climb to a whopping 95%!

Navigating healthcare and being able to protect yourself financially can feel like a losing battle. Are you wondering, do medical bills affect your credit?

Let’s get into what you need to know!

Do Medical Bills Affect Your Credit?

To put it simply, it depends. It depends on the lender. Some medical debts can impact your score severely, especially if the lender uses older versions of credit scores.

First of all, you should know that you have several different credit scores, and each of them can be affected in a variety of ways.

For example, the FICO 9 (the newest score) disregards paid collection accounts. Furthermore, open medical collection accounts carry less statistical weight than they did in previous models.

However, most accounts still use the FICO 8. This model examines any small collection bills if the original balance exceeds $100.

The Vantage 4.0 score, on the other hand, separates medical collection bills from other collection accounts. It penalizes non-medical collection accounts but doesn’t affect medical ones as harshly. It also disregards medical bills with less than six months in collections.

The silver lining for medical bills and credit scores? The three major credit reporting agencies, Transunion, Equifax, and Experian, don’t report medical debt until after 180 days after it incurred.

This gives you ample time to plan out how to take care of medical bills.

Avoiding Negative Credit Impact

A low credit score can impact everything, from how a potential employer screens you to the interest rate you receive for a new home.

Ideally, you want your score to be as high as possible. That said, a medical crisis can demolish even the most substantial emergency savings.

Stay Updated on Your Medical Bills

Insurance can be undoubtedly tricky to navigate. In fact, research shows that 96% of Americans struggle to understand basic insurance terms.

To stay safe, consult with your insurance company after every doctor or hospital visit. Yes, this may seem like overkill, but it will help you determine if you have a balance. Even if you have a premium insurance policy, you shouldn’t assume that they will cover everything.

Often, you can also check your balance on your company’s online portal. Make it a habit to check it once every two weeks or month- and after medical appointments or surgeries.

Finally, don’t forget to comb through your mailbox! Even though most of us receive copious amounts of spam, you don’t want to accidentally toss a critical bill.

Request an Itemized Bill

Let’s say you had a standard procedure that was ‘supposed’ to be covered by insurance. Two months later, you wind up with a surprise bill costing $2300.

It’s a familiar scenario. However, it’s one that can devastate individuals and their families.

You can either pay the bill willy-nilly. Or you can freak out. Or you can determine exactly what services were being rendered.

Billing companies and healthcare providers make mistakes – plenty of them. An itemized bill lines each service and provides you with the opportunity to determine how everything stacks up.

Check For Errors

If you believe your insurance covers certain services (that don’t end up being covered), call your provider. You need to play an active part in your medical planning.

You can also check for the bill’s validity. For example, if you don’t believe you actually owe a bill, you can ask the collection agency to validate the debt in writing within one month of receiving it. You can also dispute it with the credit agencies.

Medical bill scams are rampant. Make sure to determine the legitimacy of any bill you receive before sending payment.

Negotiate With The Collectors 

Striking a reasonable compromise with the collection agency is possible. First of all, you can ask if paying it off immediately will avoid them reporting you.

Ideally, you want to aim to remove the medical debt from your credit report. Some agencies refer to this process as a ‘pay to delete.’ If your agency agrees to these terms, get it in writing.

Likewise, some situations may feel completely unfair or even ridiculous. For example, maybe you never received your copy of the bill. If this occurs, you can consider filing a formal complaint with your state’s attorney general or the Consumer Financial Protection Bureau (CFPB).

You can also contact your provider and request them to pull the bill from collections to enable you to pay them directly. If the provider agrees to this, the agency will remove the debt from your report.

Negotiate For A Payment Plan

If you already know that you won’t be able to pay a bill in full, contact your insurance to determine if you can collaborate on a payment plan.

They don’t have to agree to it. However, most insurance companies want to work with their customers. After all, they want to get paid, too!

However, you should note that providers can still send bills to collections even if you’re making payments. Make sure to agree on a payment arrangement in writing.

Alternatively, you can consider opening up a credit card with a 0% APR to transfer your balance. That way you can pay off your bill on your terms without it going to collections.

Final Thoughts

Do medical bills affect your credit? As you can see, it depends on the bill, lender, and your proactivity in your treatment.

Are you struggling with a low credit score and looking to improve it fast? Be sure to check out our essential tips today.