Passive Credit Repair

New credit reporting tactics mean that rent payments may now have an impact on your credit score. So if you haven’t been faithful about making timely payments because they’re not reported to the bureaus, it’s time to change that habit.

In June 2010, Experian purchased RentBureau, a rental reporting agency that collected rental payment information. Months later, Experian began reporting timely rent payments on consumers’ reports. Those payments, in turn, were reflected in consumers’ VantageScore based on Experian credit report data. This year, Experian plans to begin reporting both negative and positive rental history. That means late payments can hurt you the same way that timely payments can help you.

A newer reporting agency, CoreLogic, is working with FICO, provider of the well-known credit score, to create a report and score that includes rental payment history, according to the New York Times. Timely rent payments can make it easier to rebuild a bad credit score, especially if Read more…

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.

Credit score monitoring is important for consumers who need to ensure their scores are strong enough especially when considering a loan or other type of financing. Now, through today’s technologies integrated into today’s mobile phones, consumers can access their credit scores while on the go using several phone apps suitable for a mix of consumer mobile phones.

For instance, Apple has an application for its iPhones where users can received updated credit scores from the credit reporting agency Experian each month. They can also inquire about more specific information such as their ratio of available credit to their total credit limits.

The idea behind mobile access for credit scores can aid consumers in achieving better results where credit checks are used such as when you are looking at renting an apartment or a house and the landlord is interested in your credit background before approving the signing of the lease. If you are pursuing other financing such as an auto loan or a mortgage, the mobile apps will allow consumers to make more informed choices while in the moment. Read more…

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…

Though only five years old, Mint.com has quickly established itself as a highly recognized personal finance management web-service. For the uninitiated, Mint.com has been listed by Time Magazine as a top-50 website for the last three consecutive years and is the winner of the Webby Award for Excellence on the Internet for Best Financial Service in 2009, 2010, and 2011, beating out financial news giants CNNMoney, NY Times Dealbook, Nerdwallet and Yahoo! Finance.

Mint.com allows its users to aggregate their banking accounts, investments, insurance policies, IRAs and mortgages into its management system which automatically provides up-to-date categorization, support and tools for budgeting analysis and bill reminder services. Their services are essential for those wanting to take control of their financial lives and improve their credit scores. Best of all, Mint.com is completely free.

The site was conceived by Aaron Patzer in 2006 after quitting his day job as a software architect to develop a method for analyzing numerous financial documents with high accuracy. After gaining the interest of First Round Capital, Mint.com received the seed capital to further develop their concept. Patzer’s ideas ambitions became so popular that grabbed the attention of Intuit, a financial software company and maker of Quicken, which extended an offer to purchase Mint.com for $170 million in late 2009.

CreditRepair.org was granted an opportunity to gain some insight into the company from Aaron Forth, Inuit’s Vice President and General Manager of Personal Finance Group. Read more…