Best Tips For Maximizing The Benefit Of Credit Card Balance Transfers

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Balance transfer is one of the best options to get out of credit card debt by transferring the balance from the high interest card to the low interest or even a 0 percent one, subject to terms and conditions. These terms and conditions are usually with respect to the time frame in which the low or zero percent interest period can last, also known as introductory period. Here are top 10 balance transfer tips that can help you in reducing debt and saving a lot of money

1. Research for the best deal – Do not fall into the gimmick trap but do your own research to find out if the balance transfer offer is worth it. For instance, some balance transfer offers may be for a short-term and that also with substantial fees. In some cases, the rate for new purchases may be quite high which means if at all, you use it for purchases, there is a risk of high interest rate. Weigh your options correctly and go for a balance transfer card with the best options to you, so that you can save a lot of money.

2. The time period and the interest rate – These are two factors that matters the most when you transfer the balance. So find out how long is the introductory period and the rise in interest rate after the introductory period is over, before applying for a balance transfer.

3. Find out how much money you save on the credit card – You can use a balance transfer calculator to find out how much money you can save through shifting the balance to the new card. Also, you can use the credit score estimator to find out by what points, the credit score can rise, if you pay your outstanding balance quickly,.

4. Do balance transfer only from a high interest card – Picture this, you have a credit card that has an interest rate of 7. 5 APR and you do a balance transfer. There are fees for the balance transfer to the extent of 4 percent and there is an annual fee also. If this is the case, you are not really saving money. In other words, just do balance transfers on the cards that carry high interest rates.

5. Keep your old credit card account open – Do not close the account of the card you shifted your balance from. Also do not close the oldest card that you use. Keeping your old account open and active can be of help to your credit rating and also shows to the lender that you have good amount of available credit limit.

6. Stop using old cards once you transferred the balance – This is not a contradiction to the above point. We should not close the accounts, only stop using the cards. Also, if you are tempted to spend, you can cut the card. Do not use the balance transfer card for credit purchases, you can use one of your oldest ones for that or get a low interest card for new purchases.

7. Prioritize paying your outstanding balance – The best way to get out of debt and to increase your credit score is to pay off the outstanding balance before the introductory period.

8. Do not make purchases on the balance transfer credit – Purchases have a higher interest rate compared to balance transfer. A balance transfer card should be used only for paying down the shifted balance and not for new purchases, which may have a higher interest rate, which can only increase your debt burden.

9. Do not default on your payment on the balance transfer credit card – This is a very important point; you must find out how high will be the increase in APR if you fail to make payments. In a general scenario, two more late payments can make the credit card company cancel your promotional offer of low interest rate and put you on a high interest one right away.

10. Find out if there are any payments pending on the old credit card – Find out if you have to pay an interest for the previous month, before you may be levied interest before the balance transfer took place.

Rebates Perks and Rewards Cards Remain Ultra Popular With Consumers

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What are the Benefits from Using Travel Reward Credit Cards for Everyday Purchases?

You could finance a dream vacation or quick weekend getaway in 2012 if you leverage the benefits of a travel reward credit card this year in a financially smart way to cover everyday purchases. We wanted to give you some different ideas on how to benefit from a credit card beyond a simple zero percent balance transfer. Travel reward credit cards compensate you with miles or points that you can use for cash, airline, account or hotel credit, merchandise and gifts. The way that it works is when you use their card for your everyday purchases they “reward” you some enticing benefits and if you’re a traveler these benefits can be very helpful as you visit new and exciting places.

When you consider how much you spend or put on your travel reward credit card you’ll need to consider how much you spend will equal how many points that you can accumulate on your credit card. Also make sure you pay attention if your travel reward credit card has an expiration date on it, to see if your reward points may expire.

By reviewing your spending and travel habits you can easily figure out how much you will have to spend on your card before you can get the level of reward benefits that will give you the most bang for your buck. So make sure you look into how much you need to spend to get 20,000 points or miles before you can redeem them to travel, and how long it will take to earn your points and really how much you will have to spend.

These travel reward credit cards give you greater flexibility and freedom in how you redeem and earn your travel benefits. There are a huge number of places that you can use all of these rewards, like hotels and different airlines; there are even maximum benefits so that you can travel with absolutely no restrictions. You may even want to use your points on cruises, car rentals or hotels just to name a few.

It is always a good idea to check and see what different types of travel benefits that are being offered with your travel rewards credit card. There are many that offer flight insurance and automatic car rental insurance. When you decide to rent a car you may also be able to get secondary collision damage insurance available to you just by using your travel rewards credit card.

Some additional benefits available to you are the additional travel services such as global travel assistance, this will defiantly be a great benefit to you if you need to locate lost luggage or have to replace a lost passport or even re-book a flight.

By arming yourself with all of the information available to you, finding those great travel reward credit card benefits should be no problem. If you are thinking about consolidating all of your spending on one card, the benefits of a travel reward credit card where you can actually earn points, miles, cash back or a whole bunch of stuff that you can actually use is a great idea. Keep in mind that you shouldn’t let your spending get too far out of control just so you can get a free tennis racket or some extra airline miles.

Plan Ahead To Maximize A Travel Rewards Credit Card

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Traveling is so much fun to do. Impromptu travels are even more exciting, but may come with a possible risk of messing up on your trip. Planned travels are not even excused from getting messed up, but are definitely more recommended in order to have a smooth travel.

An essential part of your travel plans is to prepare for your finances. In doing the preparation, you should be able to find out how much money to bring and where your money is budgeted on. Some people prefer to carry cash with them, but others would rather have a travel card handy.

Before getting a travel card for your trip, you better make sure that you are getting only the most useful and most convenient type, one that can compensate to the expenses you incurred during your travel.

Travel Card Fees and Charges

Travel cards will prove to be useful if you are going on an international trip. These cards are usually accepted in various locations worldwide since they carry the Visa or MasterCard logo. But you need to educate yourself of the hidden fees and charges that may be incurred. In certain cases, travel cards may incur daily usage charges or annual reload limits. If you are a frequent traveler, you must look into this aspect and monitor your usage of the annual limit.
Foreign exchange rates can also incur travel card fees. The charges will vary on the country of your destination and the type of transaction.

Another thing to consider in getting a travel card is an interest-free type of card. There are travel cards that do no charge any interest on your purchases during your trip. You simply settle whatever your monthly bill is. This is the difference that a travel card makes from credit cards which incurs high interest rates especially if purchases were made on a location outside of the country where the card was issued.

Travel Card Rewards Points

Credit card companies are sure to offer rewards points on their travel cards. Some credit card firms give points upon card enrollment as a welcome offer. Points may be earned for every purchase using the travel card just like a successful online booking on accredited websites. Once points are accumulated, these can be used as rewards to make purchases or acquire gift cards or whatever perks the credit card company may offer.

Travel Card Insurance Inclusion

Another important comparison to make is the inclusion of various types of travel-related insurances. You want to make sure that you are traveling securely and with protection from any possible risk or accident and that is through insurance. Check for some policies such as purchase protection, travel accident insurance, emergency travel insurance, and car rental loss and damage insurance.

Exploring Options For Balance Transfer Cards Always A Sound Idea

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Locking in a balance transfer can save hundreds in interest charges as it involves moving the balance that attracts two-digit interest charges to a new debt avenue (usually a new credit card) at a phenomenally low interest rate, sometimes even at 0% interest! With most credit instruments, the debtor usually ends up paying a huge amount of interest often finding it extremely difficult to pay back the borrowed amount and this is where locking in a balance transfer can save hundreds in interest charges, thereby reducing the debt burden to manageable proportions.

An alternative to locking in a balance transfer is asking your credit provider for a reduction in the interest rate being charged. It works out cheaper however, your current provider may not reduce the interest more than 3% or 4%, which is still better though not the ideal situation for someone who owes a lot of money by way of accumulated interest charges. This is where you can rescue yourself by locking in a balance transfer and save hundreds in interest charges.

As such locking in a balance transfer would mean you pay off more of your debt amount principal rather than struggling with the payment of the interest charges. Locking in a balance transfer is definitely a faster mode of debt repayment for someone with an intention to become debt-free.

Locking in a balance transfer is almost as easy as it sounds provided you bear in mind a few important points.

• Balance transfer offers usually come with a “limited period” clause. Locking in a balance transfer is a good idea if you’re sure of repaying within the offer period. If you defer repayment until the standard rate of interest is applied again by the new credit card, you’re going to be in as much debt as you were before.
• A new credit card with more credit limit available may tickle your spending instincts all over again. Refrain from spending too much until you clear off a major portion of the debt already incurred. Operate your expenses on a strict budget and you’ll be surprised at how quickly you can get out of debt and consolidate your financial position!
• Do not make the mistake of moving to a new credit card for locking in a balance transfer and then proceeding to close your old credit card account. You could have a negative affect on your credit scores by closing the original account.
• An important fact to check before locking in a balance transfer is whether the new card is powered by the same provider as your old card. The brand names could be different but the provider might still be the same. You’ll be unable to avail the lowered interest rate offer for balance transfer due to your existing credit history!

Locking in a balance transfer is an effective way to pay down your debt. It can guarantee savings on interest charges on your existing credit card. Scout around for good offers and if you can find a zero percent interest credit card balance transfer offer, you could potentially be saving a good amount of money. If you’re serious about repaying your debt with immediate savings, locking in a balance transfer can save hundreds in interest charges.

More Opportunities Arrive For Borrowers With Poor Credit

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If you have previously filed for bankruptcy or have a substantial bad credit rating, filing for a loan or mortgage, applying for a regular credit card or even a mobile phone hookup can be very frustrating. Your credit score hugely affects your every lending transaction. The lower the credit score, the lower the loan limit and the higher the interest rates on credit cards, mortgages, car loans and other lending transactions. In credit card applications, people with bad credit ratings may find utmost difficulty in acquiring approval. Though people obtain bad credit ratings for many different reasons, the truth remains the same: most banks and credit card companies simply do not have the confidence to bestow on someone who has a record of instability when it comes to paying for debts or loans. Difficult as it may sound, bad credit ratings do not qualify one for some of the very best credit card varieties there is in the market. You may lose low rates, high limits and other desirable benefits but the fact remains the same, it is still possible for you to get your hands on a credit card which can help you re-build your ideal credit mark.

Education is the Key

Before diving into anything drastic, one must learn first what a credit score is and how it can build up future credit references. Usually, a credit score is a three-digit number ranging from 300 to 850 directly resulting from the analysis of your credit report. The factors affecting your score is payment history, debts owed, credit history length, new credit and the utilization of certain types of credit. A routine “soft inquiry” on your credit score standing can prove to be very helpful. These routine checks may sound unbecoming especially when you do not have any outstanding debts at hand or any plans of taking a loan whatsoever. However, when you have bad credit history, making quarterly checks on your credit standing can amicably give you ample of opportunities to identify and dispute whatever inaccuracies you may come across. And this can be a positive way to counteract your bad credit standing from further deterioration.

Unsecured vs. Secured vs. Prepaid

There are three types of credit cards—unsecured, secured and prepaid. For people who are known to have bad credit marks, unsecured credit card lines are simply hard to come by as these requires credit scores of 650 or higher. The reason for this is because this type of credit card does not require a deposit for you to qualify. For secured credit cards, however, substantial deposit is required to serve as collateral or guarantee. This collateral is held by the bank or the issuing credit card company until such time that you close your account in good standing. Prepaid credit cards are making waves nowadays in the free market. People, whether in good credit standing or not, can qualify for this type of charge cards. By transferring or loading money from your account to your prepaid credit card, you can conveniently use it to your heart’s content. Normally works like any regular credit cards, prepaid variety ensures that you get to control your expenditures in such a way that you cannot overspend beyond your reloaded limit.

The Right Actions

Positively counteract upon bad credit rating with good credit standing. Using of prepaid credit cards duly credited by credit bureaus can be your best shot in upgrading your credit score. Demonstrate and re-establish your expertise in handling your credit standing. The sooner your credit score improves, the greater your chances in snagging the credit card of your choice—the one that has all the ideal perks that you wish to enjoy.

When Your Bank Says No Its Time To Explore Options

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Lenders Are Reluctant To Lower Credit Card Rates

The sub-prime crisis and the resulting high rate of foreclosures are the primary reason why lenders are reluctant to lower credit card rates. Those were the sunshine days for both credit card companies and consumers alike when access to plastic was quick and easy. Credit score monitoring was not as strict as it is today and lenders left no stone un-turned in wooing customers. Low interest rates were a common promotional offer that lasted for months and even years in some cases leading to card users borrowing credit indiscriminately and reaching a point of no-return!

High Credit Rates Good For Financial Health?

There is no doubt that several credit card users are neck-deep in debt. A lousy repayment attitude can instantly reflect on your credit score. A poor credit score means that lenders will be even more cautious and safeguard themselves against potential default by charging a higher rate of interest. It serves two purposes, the first being that with a poor credit score and high amount of debt, you’ll be discouraged to get a new card and the second one being that even if you’re desperate for credit you’ll not be able to indulge in an impulsive buying spree because of the high interest rate! Any late payments will result in your existing debt doubling and tripling over the next few months which will adversely affect your credit score.

In short, borrowing on high interest may prove extremely costly in the long run and you may find yourself struggling to get out of a vicious debt cycle! If the high rates of interest deter you from getting a new credit card, may be that’s a good thing. You can take some time off from your spending patterns and work towards consciously bettering your credit score. Work out an effective repayment schedule on your existing debts. A better credit score will encourage lenders to lower interest rates on new cards. With a good score you’ll be able to negotiate a good interest rate for not only credit cards but also other types of loans!

How to Negotiate A Low Rate Of Interest on Credit Cards

Your creditworthiness has a direct impact on the interest rates offered on your credit card. If you have never defaulted on your payments and effectively utilized your credit limit you will likely have a good credit score. The next step is to negotiate a good lending rate. By default, a lender may charge higher rates than if you were to specifically ask for a lower rate. With a good credit score and a good repayment history (sans late payments and defaults) you have all the arguments to negotiate the interest rate on your credit card!

You need to compare credit card deals online and equip yourself with the latest data on your credit history to make a serious case with your lender. A written request or continuous follow-up is usually met with a positive response. If you’re not getting a better offer, chances are great that your interest rates are already in the lower ranges. If not, negotiate on annual fees, processing fees or credit card transfers etc. Do not be rude or go overboard with arguing for a lower interest rate. If the lender does not give you specific reasons for not lowering your interest rate, you can always switch to another lender!

Managing Credit A Key For Small Business Owners To Be Successful

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Whether for personal use or for business purposes, the popularity of credit cards cannot be denied. More and more people are seeing how advantageous credit cards can be, which is why the usage of credit cards has expanded from personal purchases to those that are needed for business. Regardless of what people need credit cards for, caution still has to be practiced because the popularity of credit cards does not change the fact that a lot of people still get caught in credit card debt. In fact, because more and more people are being drawn to the credit lifestyle, more and more people are finding themselves in mountains of debt as well. Being caught in a vicious debt cycle is not the most ideal of situations, and this is why people have to be careful in dealing with this debt.

Credit Cards as Leverage

Managing credit card debt is one of the most important skills that people need to learn. Key to learning how to manage debt is understanding what it’s about. For business owners to manage credit card debts wisely, it’s important to gain a full understanding of why credit cards are needed in the first place. In a business set-up, credit cards can be used as leverage. At most, people have a 45-day window for them to pay for whatever they purchase via credit card, and this window can be used to turn that money around. For instance, if you use your credit card today to pay for the cost of goods that you will be selling, you have at most 45 days to sell those goods and regain the money you spent with profit. By the time you need to pay for it, you will have earned it back already.

Managing Debt

A key ingredient to managing debt and using credit cards as leverage is knowing how to time your credit card purchases. As a credit card user, you have to know your cutoff date by heart and ensure that you don’t miss out on any payments. Timing your purchases properly and ensuring that you have enough money to pay for your credit card bill on the due date is critical. The interest charged on overdue credit card debt is usually really high, so if you miss out on payments then the implications are huge. You especially have to take note of this for business credit cards, because the purchases are usually higher.

Maximizing Credit Cards

Aside from managing the debt wisely by taking note of deadlines and timing purchases properly, it’s also a good thing to take note of the rewards that credit card companies have available. To maximize the use of your credit card, you need to be fully aware of the deals and discounts that are available for the users. Credit card companies usually have a whole menu of rewards for their clients, and taking note of these rewards will really enable you to maximize them.

The Pros and Cons of Loyalty Reward Cards

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All kinds of firms are so competitive these days because consumers now have a lot of options. With the presence of the Internet, the options are even more varied because consumers can now choose to go online and shop there instead. With so many options all clamoring for the attention of consumers and a share of their pocket, a lot of firms have come up with ways to distinguish themselves and reward their consumers for their loyalty. A very common way to do this is through the rewards or loyalty card. Loyal consumers are given a card whereby they accumulate points every time they purchase from a particular store, and you can convert or redeem these points if you accumulate enough.

The Advantages of Rewards Cards

The advantage of rewards cards is that you don’t have to do anything out of the ordinary to gain points. You simply have to purchase the normal things that you purchase, and by doing so you can easily accumulate redeemable points. Of course the presence of the points and the rewards system will encourage you to purchase from a certain merchant only, but at least you get points simply by purchasing the things that you really need anyway. Merchants know their customer well, and this is why the rewards system is usually set up in a way that the customer really feels like he or she is being rewarded for being a loyal customer. From the customer point of view, it’s like an added bonus to something that you usually do anyway.

Save While Being Rewarded

Using loyalty cards and really taking advantage of them will result to a lot of savings. This is because these loyalty cards are usually on a membership basis, and merchants often give special deals and discounts to their members. You can’t take advantage of these deals if you don’t have this card, so this is why its’ a very important card to have. Another thing is that the rewards you can redeem usually include free items that you can use, and you can have access to these items simply by accumulating points. Depending on the merchant, these freebies can range from all kinds of goods that the customers might want, but the bottom line is that you still get these goods for free.

Customize the Benefits

With loyalty cards, merchants usually give their customers a whole range of benefits to choose from. You don’t have to be constrained to a particular kind of reward because depending on your tastes and preferences, you can redeem your points in such a way that will really be fulfilling for you. For instance, if you’re a frequent flyer and you earn so many points, your reward could be in the form of a free flight to anywhere you want or a stay in the hotel or resort of your choice. When you have a loyalty card from a certain department store, you can redeem your points and choose any product of your liking. It’s important to remember that you are the customer, and even if these rewards are free, you can still choose the rewards that will result to the most savings for you.

Looking back at the 2009 credit card act

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Although the Credit CARD Act was approved in 2009, it’s only in recent times that its effects on users have become much clearer. Fair Isaac and Co. does not, for instance, make any changes with their risk-modeling program for evaluating credit scores without at least 2 years’ worth of data in their hands. Since the last of the phased changes of the CARD Act took place in 2010, it is only this year that the company would have sufficient information about the impact of the new laws on credit scores. It’s possible that credit card users would have to brace for even more changes – but whether it’s good or bad remains to be seen.

However, credit card users get to experience the following changes in the meantime due to the Credit CARD Act.
Limited increase in interest

Interest increases on new transactions will only take place after the first 12 months of usage. Moreover, any substantial changes with the terms and conditions of the card should be done with 45 days of advance notice.
Conditions for universal default

Universal default allows a company to raise interest charges based on an individual’s payment history with other issuers of credit, e.g. utility company. However, it can now only take place with 45 days of advance notice for future but not present balance.

Opting Out

An individual now has 5 years to pay off remaining balance based on present terms if or she decides to opt out of credit card usage because of changes in terms and conditions.

Credit Card for Young Adults

More limitations have now been set for offering credit cards to young adults. Companies may only extend credit card offers to those below 21 years old if they adhere to the following rules.
• They can show proof of sufficient income or—
• They can get an adult to co-sign for their account
• They must not make an offer within 1,000 feet from a college campus if their promotions include use of free gifts

Longer payment period

Credit card users should now have a minimum of 21 days from date of notice to settle their monthly balances. This particular change is in response to various complaints of credit card users in the past regarding sudden changes of payment dates, which then increased the chances of being penalized for late payment.
Increased transparency for date and time

The Credit CARD Act has also made it possible for credit card users to enjoy uniform regulations about payment due dates and deadlines.
• Due dates should remain the same every month
• Due date cut-offs should not be earlier than 5 p.m.
• Payments for due dates or on holidays and weekend as well as when a company is closed for business should not be penalized with late fees
Application of Payment
For credit card users with varying interest rates for varying transactions, payment must first be applied to balances with the highest interest rates.

Over-limit fees

Over-limit expenses are now an option and not made an immediate part of a credit card package.
• If you opt-out of this service, then your transactions will be immediately rejected when you have reached the limit of your credit card
• If you opt-in, the fee for over limits should not be more than the actual amount of your expenditure outside your limit. If you are allowed to spend $100 over your limit then your fee cannot be more than $100.
Numerous other changes have been made with the Credit CARD Act and you are highly recommended to learn about all them if it’s been a long time – or it’s your first time in all – to apply for a credit card.

Avoid These Mistakes When Using Rewards Credit Cards

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Although credit cards can help you save money and especially the reward cards, on the other hand, there are things you need to check to avoid getting penalized and suffering unnecessary costs. First, some credit cards have cash back that drop off with time. This means that if you have not attained the eligible perks’ qualification mark, you will lose out all the points, miles, cashrebates, and other rewards that were attached to the card.

Before you choose any reward card, you need to ensure that you can meet up to the expectations on spending. Some cards offer some high percentages on cashrebates for example, 5 percent but after you have reached a certain amount in purchases, the rates tend to go down significantly to either 1 percent or something similar. This means that you only enjoy high rates of cashbacks on a limited time and after that, you end up only earning very little in cashrebates. One way you can get yourself out of such traps is by reading the fine prints and every detail of the perk.

The second thing you need to check is reward cards that do not apply to you. Not all reward cards are suitable for every other consumer. A frequent flyer will need an airline miles and hotel reward card. A mum who spends much on household budget will need a card that offers good perks on gas, groceries and other household stuff. Similarly, a dad who plans to do major renovations within the year may need a home improvements reward card that enables him to save on building materials and supplies when remodelling or constructing a new home.

For a miles credit card, it would be good to collect the flyer miles as they enable you to get free tickets to certain destinations. This is an ideal choice for the frequent business flyer. Therefore, if you are a homebody and you do not like travelling whether for pleasure, business or work related purposes, then this may not be a good card for. You will be wasting your time swiping the card that otherwise it is intended for airline rewards. You may risk racking up more debt on a card that you may not use at all.

The general rule is that if a card does not match your spending patterns you would better do without it or seek one that goes with your spending habits. The third aspect you need to consider is the rewards that do not vanish. In order to understand the limits that are attached to a reward card, you need to read and comprehend the fine print. Some cards have clauses which can compel you to forfeit your rewards if you have not used the card for a certain period say 12 months.

Therefore, if you are inactive for about 12 months it means that you may lose all the privileges including the rewards that you had acquired from the cards such as the points. In the same way, you may also lose your rewards if you experience a late or missed payment of your card balance. There are expiry dates on rewards cards, which mean that if you do not use your perks like cash backs within a specified period, when the expiry date reaches, you lose the perks automatically. These are some of the clauses that you must check when choosing a reward card. Otherwise, you may end up incurring the costs of using the card without benefiting in any way.