Credit Cards & Loans

Capital One Financial Corporation launched the new Journey Credit Tracker. It is an online credit education resource for customers with Journey Student Rewards accounts. Capital One’s new venture is powered by CreditKarma and allows cardholders access to their credit score each month from the TransUnion reporting agency.

Capital One instituted the Journey card to teach students the basics of a credit foundation. It is designed to help student card holders build a strong financial history and understand the importance of making a good financial choices especially as a young adult.

The Journey Credit Tracker will help student cardholders track the financial progress by allowing fast access to their score and ongoing monitoring of that score to see how financial decisions will affect it. Students can utilize the tools to compare their own score to other people of the same age or location. The tool allows users to simulate what would happen to their credit score if they made certain financial sources. In addition to the tracking tools, the Journey card website provides Read more…

Now that the spending holidays have passed, there is a lot of consumer concern about eliminating the debts incurred on credit cards and starting credit repair initiatives. For consumers that overspent and now face the inability of being able to repay their debts, it is important to explore debt relief options before choosing one, especially for those considering a zero-percent balance card.

Balance transfer credit cards give consumers the option to transfer existing card balances from other cards with the theory that it is easier to pay down one debt, especially at a zero-percent interest rate. However, there are some precautions to take with a zero-percent balance transfer card.

Consumers are being advised to look at every detail of the credit card offer before signing on to transfer balances. What you don’t know about balance transfers could cost you more in the long run. It is advisable to first look at the length of time the 0% rate is being offered and be assured you can repay the balance within that time frame. Many consumers fail to realize the zero-interest offer is only for a promotional period. Once that time frame ends, the interest rate could be much higher than you can reasonably afford.

The other important aspect of balance transfer cards consumers need to understand concerns the fees for card use. Transferring of balances from other cards is not without Read more…

People struggling with bad credit know how difficult it is to get approved for a new credit card. But what if you were given the chance to open a new card with the agreement that you’d pay off an old debt? Would you accept the offer?

In December 2011, the Wall Street Journal reported a credit card arrangement just like this. Consumers with bad scores were able to get a new card, but it required them to pay several hundred dollars per month toward an old debt. Is it worth it?

How Old Debts Become Duds

After a certain amount of time, creditors and collectors lose their power to pursue you for a delinquent debt. The statute of limitations, which determines how long you can be sued for a debt, is different for every state, but ranges from 3 to 15 years. In most cases, the statute of limitations on debt is six years or less. If a collector sues you for a debt you haven’t touched in several years, all you have to do is Read more…

Retailers are reporting that credit card spending by consumers is back up during the 2011 holiday shopping season. Unlike last year, consumers were not as shy about charging gift purchases to their credit cards.

Overall data shows that credit card spending was up 7 percent in November and was on the rise also for the first part of December. Credit card companies have been hoping to encourage consumers to use more plastic and the signs that they have been doing just that may mean consumer spending confidence is back on the rise.

While the news may be good for the economy, it may not fare as well for the consumer. Outside of the holiday gift shopping sprees, consumers have reportedly been spending even more thanks to the multiple credit card promotions being offered by card providers. These tactics meant to lure people into the credit card companies has been working and reports show consumers are spending more on plastic. At the end of November, several of the major card providers including American Express and Discover have reported customers are retaining higher balances on their credit card accounts than they did last year.

The still-shaky economy is happy for the boost but consumers may not be as capable as paying their credit card balances off as they should be. With lower credit scores and higher interest rates, it is harder for consumers to pay off balances in full which is the first step to burying yourself in debt.

Credit counselors have already been reporting worried phone calls coming in from consumers who overdid it during the holidays. This does not necessarily signal additional debt concerns for the new year but it is a good sign that consumers are seeing help actively before credit card payments become a problem.

Chase Bank recently announced a big change to its Freedom cards – the credit limit will be replaced with credit access lines, in other words the cards will no longer have a preset spending limit. The concept of no preset spending limit isn’t new, charge cards have used these spending limits for years. More credit cards with revolving credit lines are replacing the “hard” credit limit with a “soft” one that can be exceeded with no over-the-limit fee.

One of the biggest problems with the no preset spending limit is that you don’t have a physical signal telling you to stop using your credit card. If you have a traditional credit limit and you’ve chosen not to have over-the-limit transactions processed, you’ll get denied if you try to make a purchase that puts you over your credit limit. Even before you get denied at the register, you can check your available credit to see how much you can purchase. Without a credit limit, you’re prone to the type of overspending that leads to missed payments, delinquencies, and other credit problems.

Credit bureaus and credit scoring models handle some no present spending limit accounts in a way that hurts your credit score. Remember that 30% of your credit score is based on your credit utilization – the ratio of your credit card balances to their credit limits. Creditors who have Read more…

With the pace of society today, it is no wonder consumers expect fast action for all of the financial obligations. However, credit experts warn consumers to slow down when it comes to credit repair. There is no ‘overnight’ or ‘once-and-done’ solution when it comes to credit scores and credit repair.

Proper expectations are a big part in keeping consumers on track for a better success rate at debt elimination and credit repair. When consumers go into credit repair processes with too high of expectations, failure is imminent.

This is an important topic for consumer protection because there are many agencies and individuals making promises to ‘cure’ debt problems and fix debt problems in minutes. The reality is that credit repair does not work that way. It takes several months or years to truly turn around a poor, unstable financial situation filled with debts. Unfortunately, there are many consumers desperate for help that will believe the hype and as a result they will spend money they do not have for help that does not come.

Financial experts are advising consumers, especially now that the holidays are near, to research their own power at Read more…

Consumers have long been warned about the dangers of department store credit card offers. Many stores will offer seemingly excellent discounts at the cashier counter in order to entice consumers into signing up. However, while a 30% discount on your purchases may seem like a great idea at the time, it can do a number on the credit score of the card applicant.

Department store credit cards are not much different than credit cards in that misuse of the cards can drastically reduce your credit score. If you fail to pay your credit card bill on time each month you will suffer the credit consequences. If you are unable to pay your bill in full at the end of the billing cycle, the interest rates can be devastating for those who did not read the disclosure statements before committing to the department store credit card.

Consumers now have to proceed with caution around major credit cards that are also participating in the holiday shopping craze. Many credit card companies are offering specific rewards for new card holders that spend money on their Christmas gift shopping.

The initial deal may seem like a great way to save money over the holidays but many consumers will find that reality is just the opposite. Studies have shown over and over that people tend to Read more…

Technology created to prevent credit card fraud from ruining a consumer’s credit is coming to JP Morgan Chase & Co to help protect card holders.

The bank, headquartered in New York is producing their new British Airways Visa card with a computer chip inside that contains account information. These computer chip cards are meant to provide more security and protection from hackers than the normal magnetized strips.

The credit card technology is becoming a standard in the overseas market and it is part of the industry standards referred to as EMV. While other countries have been utilizing the technology, American credit cards are starting to take notice. There are some considerations, however, that should be made concerning the technology. US merchants must make necessary upgrades to their credit card processing systems in order for the cards to be functional. The costs of those upgrades have made many Read more…

A bad credit score can hold you back from a lot of things – buying a car, owning a home, getting good insurance rates, and even from getting a job. Most of the time, your credit score isn’t the only factor that’s considered when you put in an application. Don’t be an all around bad candidate just because your credit is bad. Look great – on paper – even if you have a bad credit score.

Don’t keep making credit mistakes.

The older the negative information on your credit report, the better you look. So, from now on, make sure you pay all your bills on time. Remember that creditors report 30 day late payments, so if you missed your due date by a couple of days, make your payment before the next statement arrives. You’ll still face a late fee, but you’ll avoid having the late payment being entered on your credit report.

Pay off some debt.

You’re a better candidate for credit cards and loans when you have less outstanding debt. When you do have credit card balances, it looks better when those balances are below 30% of the credit limit. So, if you can’t afford to pay off all your balances, at least pay down the balances that are close to the credit limit.

Keep your applications to a minimum.

Even an applicant with a great credit score looks risky when they start applying for several Read more…

There is a new competition among credit card providers to garner the attention of consumers with so-so credit histories. New reports show that more credit cards have been provided to consumers with lower credit cards. TransUnion is reporting that 25.2% of new credit card accounts were opened by those who maintain scores less than 700.

A consumer credit score ranging from 700 and below signal that the consumer has had issues in the past making credit payments or who have run up significant balances in the past. Since the biggest push in recent economic times is to avoid poor score holders and focus on the excellent credit score holders, the results of the TransUnion research is important.

80% of all new card offers still go to consumers with top-tier credit scores. Along with the card offers, the benefits that go along with the cards have also been boosted and interest rates cut. While the top-tier credit holders have Read more…