I first want to thank you for taking the time to read this free report about building business credit, we provide this report to anyone without requiring you to sign up for anything. No need to join our newsletter, no need to speak to a sales representative, no need to do anything. We feel that this information is so important that you should have it without condition. We hope this information will help you choose a company and more importantly stay away from companies that put your company and your hard earned money at risk. Before you choose a company we recommend that you do your homework. We did just that with several companies and we were shocked with the results.
There are only a limited number of credit cards for individuals with bad credit. At first glance, many look the same. They all help build and rebuild your credit by reporting to the major credit bureaus on a monthly basis. They all provide you with the Visa or Mastercard you need to make many purchases. And they are all necessary evils that can save you thousands of dollars in mortgage and car loan rates in the future. However, you must read the fine print before applying for one of these credit cards, as they often charge high yearly fees, set-up fees, and even monthly fees. Here, I will examine a few examples of charges current "bad credit" credit cards bury in the fine print. Of the three major cards I will examine, only one stands out as consumer-friendly.
"Bad Credit" Credit Card #1: This credit card charges a very low interest rate for an unsecured credit card. However, your first fine print glimpse reveals that there is a one time setup fee of $29. Not too bad. So far, since the next charge is a one time fee of $95. So far, we're up to $124 in expenses. That's got to be it, right? No. Add in another $48 for the annual fee and $6 per month in account maintenance fees. That's brings the cost of your new credit card to $244 the first year, and $120 each additional year. This is no small change, and a card such as this should be considered only if you cannot be accepted for a better unsecured credit card for bad credit.
The bigger and scarier issue that we uncovered while researching these companies is what we consider Fraud, misrepresentation, and false advertising. We found one company that charged about $20,000 to build a company with credit. We had some hope in them as they seemed to be the only company that utilized an advanced methodology when building business credit. Unfortunately, when we searched further we found that the owner of this company is a defendant in a $100,000,000 lawsuit and has had newspaper articles written in major newspapers that highlighted his companies questionable practices. These articles have caused major credit bureaus to key in on his business practices, will DnB be one of them? Do you really want to be associated with a company that can lose everything in a lawsuit who has a target on their back for questionable practices?
If your balances are high, simply paying them down can have a dramatic, positive effect on your credit score. Reducing high balances on revolving accounts will go a long way toward fixing a low score. This has an effect on 2 key components of your score; credit utilization percentage and total outstanding debt. Together, these 2 factors account for about 40% of your credit score, so you can see how optimizing them will help fix your credit score. The credit utilization score indicates someone's available revolving credit as a percentage of their total revolving credit. For example, if you have 4 credit cards with limits totaling $20,000, and you owe $10,000 on them, you have a 50% credit utilization score. Something else that is affected by high balances that's not actually part of your credit score, but does affect you ability to get a mortgage is your debt to income ratio. Although your amount of total debt is a very large part of your credit score, the actual debt to income ratio isn't. Typically, lenders want to see both a high credit score and a total debt to income ratio of less than 36%. They'll use these when calculating how much home you're able to afford, and if they'll extend financing to you at all.. In the opinion of many financial advisors, 36% is way too high and leaves precious little room for error down the road. A figure of 20 - 22% is a more conservative number many experts are far more comfortable with.
Clearly, there are substantial difference between "bad credit" credit cards. Of the three offers we have examined, only one doesn't take you to the cleaners. In fact, "bad credit" credit card #3 provides great value. All positive changes to your credit history and credit score will translate into lower loan rates, lower credit card interest rates, lower insurance rates, and ultimately, thousands of dollars in savings. The path to rebuilding credit has its costs, but in the long term, rebuilding your credit with a "bad credit" credit card is the fastest and most cost-efficient way to correct the often unfortunate circumstances that have damaged your credit in the first place.
There are only a limited number of credit cards for individuals with bad credit. At first glance, many look the same. They all help build and rebuild your credit by reporting to the major credit bureaus on a monthly basis. They all provide you with the Visa or Mastercard you need to make many purchases. And they are all necessary evils that can save you thousands of dollars in mortgage and car loan rates in the future. However, you must read the fine print before applying for one of these credit cards, as they often charge high yearly fees, set-up fees, and even monthly fees. Here, I will examine a few examples of charges current "bad credit" credit cards bury in the fine print. Of the three major cards I will examine, only one stands out as consumer-friendly.
"Bad Credit" Credit Card #1: This credit card charges a very low interest rate for an unsecured credit card. However, your first fine print glimpse reveals that there is a one time setup fee of $29. Not too bad. So far, since the next charge is a one time fee of $95. So far, we're up to $124 in expenses. That's got to be it, right? No. Add in another $48 for the annual fee and $6 per month in account maintenance fees. That's brings the cost of your new credit card to $244 the first year, and $120 each additional year. This is no small change, and a card such as this should be considered only if you cannot be accepted for a better unsecured credit card for bad credit.
The bigger and scarier issue that we uncovered while researching these companies is what we consider Fraud, misrepresentation, and false advertising. We found one company that charged about $20,000 to build a company with credit. We had some hope in them as they seemed to be the only company that utilized an advanced methodology when building business credit. Unfortunately, when we searched further we found that the owner of this company is a defendant in a $100,000,000 lawsuit and has had newspaper articles written in major newspapers that highlighted his companies questionable practices. These articles have caused major credit bureaus to key in on his business practices, will DnB be one of them? Do you really want to be associated with a company that can lose everything in a lawsuit who has a target on their back for questionable practices?
If your balances are high, simply paying them down can have a dramatic, positive effect on your credit score. Reducing high balances on revolving accounts will go a long way toward fixing a low score. This has an effect on 2 key components of your score; credit utilization percentage and total outstanding debt. Together, these 2 factors account for about 40% of your credit score, so you can see how optimizing them will help fix your credit score. The credit utilization score indicates someone's available revolving credit as a percentage of their total revolving credit. For example, if you have 4 credit cards with limits totaling $20,000, and you owe $10,000 on them, you have a 50% credit utilization score. Something else that is affected by high balances that's not actually part of your credit score, but does affect you ability to get a mortgage is your debt to income ratio. Although your amount of total debt is a very large part of your credit score, the actual debt to income ratio isn't. Typically, lenders want to see both a high credit score and a total debt to income ratio of less than 36%. They'll use these when calculating how much home you're able to afford, and if they'll extend financing to you at all.. In the opinion of many financial advisors, 36% is way too high and leaves precious little room for error down the road. A figure of 20 - 22% is a more conservative number many experts are far more comfortable with.
Clearly, there are substantial difference between "bad credit" credit cards. Of the three offers we have examined, only one doesn't take you to the cleaners. In fact, "bad credit" credit card #3 provides great value. All positive changes to your credit history and credit score will translate into lower loan rates, lower credit card interest rates, lower insurance rates, and ultimately, thousands of dollars in savings. The path to rebuilding credit has its costs, but in the long term, rebuilding your credit with a "bad credit" credit card is the fastest and most cost-efficient way to correct the often unfortunate circumstances that have damaged your credit in the first place.
About the Author:
Frank Miller has a Debt Consolidation Blog & Finance, these are some of the articles: The Proper Way To Find Potential Non-public Funding Investors For Apartment Investing You have full permission to reprint this article provided this box is kept unchanged.
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