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Top Reasons to Repair Your Credit

Having a good credit score has numerous financial advantages. It can help you solve your financial problems without much effort. The opposite also applies to having a bad credit score. The good news is you can repair your credit score within a short while. The easiest way to do that is by hiring the services of credit repair companies. Below are some top reasons to repair your credit.

To Reduce Interest Rates

low interest ratesIndividuals with poor credit scores usually end up paying higher interest rates on the loans if they get the loans in the first place. By fixing your credit score, you can get the financing companies to lower your interest rates. You can then save the extra money to invest in other things and even improve your score further. You can also refinance your loans with other loans that offer lower interest rates.

To Lower Security Deposits Amounts

A bad credit score can hurt you even when you are not looking to get a loan or purchase assets. That is especially the case when it comes to security deposits. For example, a utility company may require higher security deposit amounts from you if your credit score is bad. That is usually done to offset additional related risks.

To Lower Insurance Rates

If you have insured your home or auto, the amount you have to pay as premiums might be affected by your credit score. Individuals with a long history of bad credit are considered riskier to insure than those with good credit. Improving your credit score and presenting a request to the insurer to lower your premiums works quite well.

To Increase Credit Limit

Most individuals usually hire credit score repair companies intending to increase their credit limits. For example, if you are targeting to get a mortgage, improving your ‘bad’ credit score might make you eligible for a much higher amount. A higher credit score also gives you more negotiating power regarding interests and repayment periods when dealing with banks and other creditors.

To Get Premium Credit Cards

Premium credit cards usually come with a variety of perks, usually tailored to individual needs. Some of the benefits include zero-percent financing offers, extremely low-interest rates, and travel credits, among many others. Repairing your credit to the extent of getting a premium credit card might be time-consuming, but the benefits are more than worth it.

a preson holding money

What are the Benefits of a Good Credit Score?

One of the essential things for any adult American, and even of any other country, is maintaining a good credit score. The excellent rating goes beyond accessing good financial services but spreads to other areas as well. This is why some people go to the extent of seeking credit repair services. This article looks at what benefits you stand to enjoy by maintaining a good credit score.

May Determine Where You Live

credit score may determine where you liveMore and more landlords are using this as a means to screen out their tenants. They access your credit score, and if it is low and caused explicitly by eviction due to late or non-payment, they may deny you a chance to rent their houses. This may be pretty inconvenient as it may force you to look waste too much time looking for a landlord that will either consider you with your low score or look into such details, and in most cases, such houses may be in not-so-appealing neighborhoods.

May Determine Your Employer

Even though the law protects under the Fair Credit Reporting Act, your potential employer or employer to see your exact credit score in some cases with your signed permission, it does allow them to see the causes of your low credit score. An employer may use these to deny a job or a promotion, especially if it is a high position at the company that involves major decision-making that may affect the company’s future and reputation.

Improve Access to Loans and Credit Cards

credit score may impact your access to credit cards and loansOne of the main factors that a lender always considers before lending you money is your credit score. They use the score to determine if you are credit-worthy or a risky lender. Even though you may be given a loan or credit card with a low credit score, a lender always increases the interest rate if you have a low score.

This is because they consider you as a risky borrower, and hence the high-interest rate is a sort of security if you may delay payments. In some cases, some lenders do not approve your loan or credit card application if your credit score is too low.

Influences Your Car Insurance Premiums

affect your auto insurance premiumsAuto insurance companies always look into your credit score before they consider you for a car insurance policy. Your credit score determines the premiums you’ll pay per month, and if you have a low score, they think you a credit risk. Even though it is to your disadvantage, you’ll pay higher premiums. In contrast, other people with higher credit scores will pay less for the same product, and the insurance companies are within the law to overcharge you since you are a credit risk.

 

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Financial Habits That Negatively Affect Credit Score

Having a good credit score is great. It grants you the financial freedom that would not be appreciated normally. Nonetheless, if you have a good credit score, it can be very easy to ruin it. Some spending habits can negatively affect one’s credit score. You must be cautious and develop a healthy financial habit to keep your credit score high and, even better, to improve it.

Luckily, that’s why we have credit repair services. There are many ways you can spend money, which will affect your freedom financially. To prevent this, here is a list of bad financial habits to avoid and things to consider if you want a good credit rating.

Spending More Than You Earn

Some people have the habit of spending more funds than they have and assume they will pay back once they have the money. Let’s say that the payment will be made using their next salary. When that salary comes, they have less than their initial pay, yet still spend more than their salary again.

This is an example of how people accumulate debt, and to get out of it, they have to get into more debt. This never-ending loop is one that has many people facing an endless cycle of debt. It slowly reduces your credit score, and rehabilitating your score becomes challenging. Before you get into a life full of debt, start spending less than you earn. Save at least 10% of your salary every month.

Overusing Your Credit Card

investment potentialOnce you get your credit card, it seems like you have “free” money because you did not earn the funds. People forget that they still have to pay back what they have used. If you use the funds as free money, you will pay for it with your cash. This habit can go on and leave you with debt you cannot pay, and it will reflect very negatively on your credit report. Your credit card is meant for emergencies only.

Paying With Checks

A dangerous habit is paying via check. This is considered bad since one does not know your remaining balance. If you are good at math and always know your bank balance, it might not be bad for you. When using checks, you get to know that you have overspent after receiving your bank statement. Paying with cash can be a little harder and more painful. However, you will find yourself spending less and saving more than scribbling an amount on a piece of paper. This is a habit that you should drop to raise your credit score.

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Understanding Credit Repair Companies

If you are new to the borrowing and lending niche, you probably must have come across several mentions of the term “credit repair company.” As a newbie, you might be wondering what it means in relation to lending or borrowing goes. If that’s right, you’ve come to the right place! This post covers credit repair companies broadly by defining them, describing their target clients, and explaining where they can be found. With that said, let’s get started:

What Is a Credit Repair Company?

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It’s an entity that focuses on getting inaccurate information that may jeopardize the creditworthiness of the client removed from his or her credit report at a small fee. Just as their name suggests, credit repair companies will “repair” their clients’ credit reports thereby improving the creditworthiness of those clients.

Now, don’t get me wrong, the keyword here is “INACCURATE.” If the information on your credit report is accurate but damaging to your credit score, you will not be able to benefit from a credit repair company.

There are many companies out there that take advantage of this concept to confuse and defraud unsuspecting clients. They achieve that by falsely claiming to help repair and improve clients’ poor credit reports by deleting information that is unfavorable thought accurate. Don’t fall for such a company! If your credit score is bad because you have outstanding debts or don’t pay your bills on time, just settle your debts and on time, if need be.

Who Are the Target Clients and Where Can Credit Repair Companies Be Found?

A credit repair company can have a diverse range of clients from individuals to businesses to institutions with a bad credit score, which is not a result of their fault. The good news is that these companies are readily available to offer their services at a fee. And with the internet being at our disposal, these companies are just a few mouse clicks away.

Final Thoughts

Legitimate credit repair companies really do play a key role in ensuring that consumers can access credit opportunities without being unfairly hindered by their credit reports. These companies are one hundred percent legal and you won’t be committing any crime by reaching out to one. After all, it’s not like you’ll be “faking” your poor credit report. Instead, you’ll just be correcting the errors on your report, which were made by the professionals who created it!