However, there are times when it might be wiser to use a credit card. For example, any time you make a purchase online, you should try to use a credit card. Why? If there ever is a case of someone stealing your credit card number and charging on it, you will usually only have to pay up to $50 of the stolen amount. If someone steals your debit card number and uses it, you will rarely get any of that money back. Some banks do offer theft protection on debit cards as a courtesy, but they are not legally obligated to refund the money stolen. It is up to the customer to close their account in order to stop withdrawals. Check with your bank to find out what their liability policy is on debit card theft. If you do use a credit card, you can always pay off your balance immediately and avoid ever paying any interest.
What type of information do credit bureaus collect and sell?
Credit bureaus collect and sell four basic types of information. Identification and employment information Your name, birth date, Social Security number, employer, and spouses name are routinely noted. The CRA also may provide information about your employment history, home ownership, income, and previous address, if a creditor requests this type of information. Payment history Your accounts with different creditors are listed, showing how much credit has been extended and whether f paid on time. Related events, such as referral of an overdue account to a collection agency, may also be noted. Inquiries CRAs must maintain a record of all creditors who have asked for your credit history within the past year, and a record of those persons or businesses requesting your credit history for employment purposes for the past two years. Public record information. Events that are a matter of public record, such as bankruptcies, foreclosures, or tax liens, may appear in your report.
I would like to re-build my credit. I filed for bankruptcy three years ago. How do I find a lender that will give me reasonable annual fee and interest rate?
Its true: after filing for bankruptcy, credit can be difficult to obtain. And what makes things worse is that your credit score will drop even lower each time a company disapproves your application. That means its doubly important that you apply for a card that youre likely to get rather than risk a turn-down. Youre definitely "at risk" at this time?a target for unscrupulous lenders with big promises and shady deals. Many lenders will try to entice you with "super-low interest rates for those who filed for bankruptcy." It all sounds good until they come up with some questionable reason why you dont qualify and then try to convince you to sign up for a card with high rates and fees. Beware! Other companies may offer low teaser rates, but then hike the interest after a short period of time. And if you miss a payment -- look out! Some impose outrageous fees for late payments, sticking you with a $25 fine when youre late on a $5 payment. Heres a secret credit card companies dont want you to know: Late fees represent as much as one-third of the income of some credit-card issuers.
Correcting Billing Errors
Federal law provides specific rules that the card issuer must follow for promptly correcting billing errors. The card issuer will give you a statement describing these rules when you open the credit card account and, after that, at least once a year. In fact, many card issuers print a summary of your rights on each bill they send you.
What is Consumers Liability for Unauthorized charges?
"If you have a problem with merchandise or services that you charged to a credit card, and you have made a good faith effort to work out the problem with the seller, you have the right to withhold from the card issuer payment for the merchandise or services. You can withhold payment up to the amount of credit outstanding for the purchase, plus any finance or related charges. If the card you used is a bank card, a travel and entertainment card, or another card not issued by the seller of the defective merchandise, you can withhold payment only if the purchase exceeded $50 and occurred in your home state or within 100 miles of your billing address. If these conditions do not apply to you, you may want to consider filing an action in small claims court -- an informal legal proceeding that can be used to settle disputes. While the maximum amounts that can be claimed or awarded differ from state to state, most small claims courts hear cases involving amounts ranging from $25 to $2,000. Some states have recently raised their limits to $5,000. Check Check your local telephone book under your municipal, county, or state government headings for small claims court listings. " * Shop around for credit card terms that are best for you. * Make sure you understand the terms of a credit card plan before you accept the card. Review the disclosures of terms and fees that must appear on credit-card offers you receive in the mail. * Pay bills promptly to keep finance charges as low as possible. * Keep copies of sales slips and promptly compare charges when your bills arrive. * Protect your credit cards and account numbers to prevent unauthorized use. Draw a line through blank spaces above the total when you sign receipts. Rip up or retain carbons. * Keep a list of your credit card numbers and the telephone numbers of each card issuer in a safe place in case your cards are lost or stolen.
Annual Fee
some credit cards also have annual fees, which can run as high as $75-$100. Fortunately, the majority of credit card offers for students have an annual fee of $0. Think of it as membership fee, which is tacked onto your balance once a year just for having the credit card. You are expected to pay this fee, and it will collect interest as part of your balance owed. However, if you pay your balance owed by the due date, you will not have to pay any interest
When should credit card payments be credited?
A card issuer must credit your account on the day the issuer receives your payment, unless the payment is not made according to the creditors requirements or the delay in crediting to your account does not result in a charge. To avoid delays that could result in finance charges, follow the card issuers instructions about where to send payments. Payments sent to other locations could delay getting credit for your payment for up to five days. If you lose your payment envelope, look on the billing statement for the address for payments or call the card issuer.
What is APR?
Annual Percentage Rate. The "annual percentage rate," or APR, is disclosed to you when you apply for a card, again when you open the account, and it is also noted on each bill you receive. It is a measure of the cost of credit, expressed as a yearly rate. The card issuer also must disclose the "periodic rate" -- that is, the rate the card issuer applies to your outstanding account balance to figure the finance charge for each billing period
How important is the Balance Computation Method for Finance Charges?
If your plan has no free period, or if you expect to pay for purchases over time, it is important to know how the card issuer will calculate your finance charge. This charge will vary depending upon the method the card issuer uses to figure your balance. The method used can make a difference, sometimes a big difference, in how much finance charge you will pay -- even when the APR is identical to that charged by another card issuer and the pattern of purchases and payments is the same.
Avoid a Late Fee Punishment
Remember the times in your childhood when asking your parents for forgiveness calmed their anger and compelled them not to punish you. If it worked, it just might work once again, only this time with your credit card issuer. Being late on a credit card payment is now a ?punishable offence,? that will cost you at least $15. However, if you?ve been ?good? on your previous payments, you will most likely get a break from your credit card company. Usually, if you call and ask for ?forgiveness,? your card issuer will oblige. If your only excuse for being late on your payments is that you?ve never been late before, this will probably work as well, as most banks usually forgive first-time offenders.?
