credit report http://www.wisebread.com/taxonomy/term/68/all en-US 7 Easy First Steps to Paying Off Debt http://www.wisebread.com/7-easy-first-steps-to-paying-off-debt <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/7-easy-first-steps-to-paying-off-debt" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/worried_young_woman_counting_bills.jpg" alt="Worried young woman counting bills" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Facing debt can be stressful and overwhelming. But it's important to remember that no matter how much you might feel that you're in over your head, debt is a hole you can climb out of. You can absolutely do this. Here are the first steps you need to take.</p> <h2>1. Figure out how much you owe</h2> <p>The first step can be the most painful. It's time to get an overview of your debt, which means you need to add up everything you owe and take a good look at your total. That, my friends, can be a difficult moment. But that difficult moment will also provide you with the clarity you need to start taking back power over your financial future.</p> <h3>How to do it</h3> <p>Gather your financial statements or log in to the online portal for each account you owe on: your credit cards, mortgage, student loan, car loan, lines of credit, home equity loan, etc. Create a simple spreadsheet with four columns: one to identify each debt (&quot;Student Loan&quot;), one for the amount owed, one for the minimum monthly payment, and one for the interest rate. <a href="http://www.wisebread.com/how-to-read-a-credit-report" target="_blank">Pull your credit report</a> to search for outstanding debts, and compare the information against what you have in your own records.<strong> </strong></p> <h2>2. Sort and prioritize the debt list</h2> <p>Now it's time to start sorting out your spreadsheet entries so you can come up with the best possible plan to get out of debt.</p> <p>You might think that the most important debt to pay off is the biggest one; however, it's often a good idea to identify the debt with the highest interest rate and knock that out first. This is known as the avalanche method of debt repayment. Higher interest rates lead to faster debt accumulation and result in you paying a higher amount over the course of your debt repayment. The faster you can get rid of high-interest debts, the better.</p> <h3>How to do it</h3> <p>Sort your spreadsheet by the fourth column, the one for the interest rate. You might see anything from a 4 percent interest rate (for example, on a student loan) to a whopping 22 percent interest rate on, say, a credit card. You may owe more principal on your student loan, but relatively speaking, you're wasting more in interest every month on that credit card. The credit card is therefore the higher priority for complete repayment. (See also: <a href="http://www.wisebread.com/5-ways-to-pay-off-high-interest-credit-card-debt?ref=seealso" target="_blank">5 Ways to Pay Off High Interest Credit Card Debt</a>)</p> <h2>3. Add up your minimum payments</h2> <p>You don't get to stop making payments on the lower-interest debts, even though they're not the highest priority. Instead, you need to continue making the minimum monthly payments on all lower-interest debts while making bigger payments on your debt with the highest interest rate. Once you knock one high-interest debt out completely, you prioritize the debt with the next-highest interest rate and continue paying minimums on everything else.</p> <h3>How to do it</h3> <p>Add up the monthly minimum payments for <em>all</em> the debts on your list, including the highest-interest debt. This is the total, bare minimum debt repayment amount that needs to fit into your current budget. This can be a nerve wracking step, especially if you don't have enough income to comfortably afford that total monthly minimum amount. You may need to take steps to cut expenses elsewhere, or bring in sources of additional income.<strong> </strong></p> <h2>4. Determine your needed overage payment</h2> <p>Now it's time to calculate the payment you need to get that highest-interest debt paid off as quickly as possible. If you keep making only the minimum payment on it, you'll keep accumulating interest charges and it will take much longer to pay it off. Instead, think of a target timeline (maybe six months or a year) for paying off the highest-interest debt, and calculate an ideal amount you can pay above the minimum payment to achieve that goal.</p> <h3>How to do it</h3> <p>Use an online <a href="https://www.calcxml.com/calculators/how-long-will-it-take-to-pay-off-my-credit-card" target="_blank">credit card payoff calculator</a>. Enter the information for your highest-interest debt: total amount owed, interest rate, and the minimum payment. You'll see how long it will take to pay off the debt if you only make the minimum payments. Now, instead of minimum payments, enter how many months you'd like to have it paid off in. The result will show you the monthly amount you need to pay in order to clear the debt within your target timeline.</p> <h2>5. Give yourself the best possible conditions</h2> <p>You have the essential numbers that you need. They may be painful, but knowledge is power. The next step is to find ways to reduce the financial impact that these debts have while you repay them. <a href="http://www.wisebread.com/5-tricks-to-consolidating-your-debt-and-saving-money" target="_blank">Debt consolidation</a> may be the best way to do this; however, you may also be able to lower your interest rates and negotiate better payment plans on individual debts, as well. (See also: <a href="http://www.wisebread.com/4-ways-to-negotiate-credit-card-debt?ref=seealso" target="_blank">4 Ways to Negotiate Credit Card Debt</a>)</p> <h3>How to do it</h3> <p>This takes some time, depending on the number of debts you have. Call each creditor and ask how you can reduce your interest rate. You may be able to refinance a home mortgage or car loan for a lower rate, for example. If you have a good repayment history, ask credit card companies to consider your reliable record and give you a better interest rate. If you're able to take out a low-interest loan, such as a line of credit or home equity loan with your bank, you may be able to use it to pay off your high-interest debt and consolidate at least some of your debts into a single, lower-interest loan.</p> <h2>6. Protect your credit and your finances</h2> <p>If you're late on a payment, being proactive can save you from accumulating fees and damaging your credit score. For example, if you call the credit card company and explain that you can't make the full minimum payment on time, they may work with you to split the payment in half for the month so you can avoid late fees. Many times, a phone call and a courteous conversation can reduce or remove a fee, extend a deadline, or result in a more manageable payment plan.</p> <h3>How to do it</h3> <p>Set up alerts or schedule automatic minimum monthly payments so you don't miss due dates. If you know you won't have the money on time for a particular payment, call in advance to negotiate an extended deadline or set up a split payment plan. Additionally, you may want to keep an eye on changes in your credit report.</p> <h2>7. Protect your financial future</h2> <p>As difficult as it seems to save money when you're trying to pay down debt, it's so important. You need an emergency fund for those unpredictable expenses that will happen. Building an emergency fund will keep you from having to add to your debt when the car breaks down or you don't get that bonus you were counting on. In other words, it's the essential tool that keeps you climbing out of that debt pit, even when life happens. Without it, one setback can set off a downward spiral deeper into debt. You don't want that. (See also: <a href="http://www.wisebread.com/4-new-reasons-you-need-an-emergency-fund?ref=seealso" target="_blank">4 New Reasons You Need an Emergency Fund</a>)</p> <h3>How to do it</h3> <p>If your budget is absolutely maxed out, you can pick up a side hustle or employ another short-term strategy &mdash; such as selling off a few high-value items, or taking on seasonal work &mdash; to quickly build up an emergency fund. (See also: <a href="http://www.wisebread.com/6-fast-ways-to-restock-an-emergency-fund-after-an-emergency?ref=seealso" target="_blank">6 Fast Ways to Restock an Emergency Fund</a>)</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" data-pin-save="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F7-easy-first-steps-to-paying-off-debt&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F7%2520Easy%2520First%2520Steps%2520to%2520Paying%2520Off%2520Debt.jpg&amp;description=7%20Easy%20First%20Steps%20to%20Paying%20Off%20Debt"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/7%20Easy%20First%20Steps%20to%20Paying%20Off%20Debt.jpg" alt="7 Easy First Steps to Paying Off Debt" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/annie-mueller">Annie Mueller</a> of <a href="http://www.wisebread.com/7-easy-first-steps-to-paying-off-debt">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-7"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/all-the-ways-minimum-payments-are-evil">All the Ways Minimum Payments Are Evil</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-ways-being-debt-free-can-cost-you">7 Ways Being Debt Free Can Cost You</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/3-easy-ways-to-improve-your-credit-score-during-the-holidays">3 Easy Ways to Improve Your Credit Score During the Holidays</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-use-a-credit-card-for-an-emergency-without-drowning-in-debt">How to Use a Credit Card for an Emergency Without Drowning In Debt</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/your-brain-is-keeping-you-in-debt-and-how-to-fix-it">Your Brain Is Keeping You in Debt (And How to Fix It)</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Debt Management avalanche method budgeting credit report credit score emergency funds interest rates minimum payments negotiating principal repayment Mon, 14 Aug 2017 08:00:05 +0000 Annie Mueller 2001479 at http://www.wisebread.com How a Goodwill Letter Can Save Your Credit Score http://www.wisebread.com/how-a-goodwill-letter-can-save-your-credit-score <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/how-a-goodwill-letter-can-save-your-credit-score" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/business_woman_working.jpg" alt="Business woman working" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Financial mistakes can cause hefty damage to your credit score. If you pay your credit card bill more than 30 days late, for example, your score can tumble by 100 points. If you have a foreclosure on your home, your score can fall by 150 points or more, depending on how long ago your lender filed for foreclosure. (See also: <a href="http://www.wisebread.com/5-simple-ways-to-never-make-a-late-credit-card-payment?ref=seealso" target="_blank">5 Simple Ways to Never Make a Late Credit Card Payment</a>)</p> <p>These mistakes stay on your three credit reports &mdash; one each maintained by Experian, Equifax, and TransUnion &mdash; for seven to 10 years.</p> <p>There may be some hope of removing those financial mistakes sooner, however. Consumers have had some success requesting that banks, lenders, and other creditors remove their late or missed payments from their credit reports early by writing what is known as a <em>goodwill letter</em> &mdash; letters sent to creditors outlining the reasons for their missed payments, explaining why they'll never miss a payment again, and requesting that these creditors remove the financial mistake from their credit reports.</p> <p>These letters offer no guarantee of success. Some creditors will simply respond that they are legally required to report the financial mistake for the set period of time. Others won't respond at all.</p> <p>But if there's even a slim chance that a goodwill letter will work, why not try it?</p> <h2>When goodwill letters do the most good</h2> <p>The most common financial mistake that ends up on credit reports &mdash; and the one that goodwill letters have the best chance of erasing &mdash; are late payments. It's important to realize, though, that late payments are only officially late for credit purposes when they are more than 30 days past due.</p> <p>Missed payments stay on your credit reports for seven years. How much these payments lower your FICO score varies depending on how high your score was to begin with and several other factors. But you can expect an immediate drop of about 100 points &mdash; a big hit, to be sure.</p> <p>As time passes and your late or missed payment gets older, the impact it has on your score will lessen. But it will remain on your reports for lenders to see until seven years has passed. That's where a goodwill letter comes in.</p> <h2>What a goodwill letter should say</h2> <p>A goodwill letter should say why you missed a payment. Maybe you lost your job. Maybe you were hit with a serious illness or injury. Maybe you were embroiled in a long divorce or legal battle. Whatever the reason, explain it clearly in your goodwill letter.</p> <p>The letter should also state that you won't pay late or miss a payment again. Your letter will work better if you don't have any other missed or late payments in your history, or additional financial blemishes on your report. Creditors probably will ignore it if your credit reports are filled with missed payments.</p> <p>Finally, close your letter with a request that the creditor remove your one financial mistake from your reports.</p> <p>There is a good chance that creditors will respond in the negative, if they even respond at all. Some creditors prefer to follow that seven-year guideline. But if you're lucky, and your case is strong enough, a well-written goodwill letter might work.</p> <p>When you're ready to send one, mail it to the address listed on your creditor's paperwork.</p> <h2>A goodwill letter example</h2> <p>Here is an example of a goodwill letter that could potentially help you in removing a missed credit card payment from your credit reports:</p> <p style="margin-left: 40px;">(<em>Your name</em>)<br /> (<em>Your address</em>)<br /> (<em>Your credit card account number</em>)</p> <p style="margin-left: 40px;">(<em>date</em>)</p> <p style="margin-left: 40px;">To Whom It May Concern:</p> <p style="margin-left: 40px;">I hope you are well. I'm writing because after checking my credit reports, I discovered that you have reported a late payment on (<em>date</em>) for my account, number (<em>list your account number here</em>), to the credit bureaus. I am writing today to request that you remove this late payment from my reports.</p> <p style="margin-left: 40px;">As you can see from my past financial history, I pay my bills on time and manage my credit well. This late payment was a one-time event, the result of a short-term job loss. (<em>Insert whatever actually caused you to miss your payment here.</em>) Because this is an isolated incident, and because my financial challenges are behind me, I would appreciate this help on your part.</p> <p style="margin-left: 40px;">My history of on-time payments since this late payment is proof that I take my financial obligations seriously. Please consider this history in making your decision.</p> <p style="margin-left: 40px;">If you have any questions, or if you would like to speak with me in more detail, please call me at (<em>your phone number here</em>) or send me an email at (<em>your email address here</em>).</p> <p style="margin-left: 40px;">Thank you for your time, and I look forward to hearing from you.</p> <p style="margin-left: 40px;">Sincerely, <br /> (<em>Your name here</em>)</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/dan-rafter">Dan Rafter</a> of <a href="http://www.wisebread.com/how-a-goodwill-letter-can-save-your-credit-score">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/heres-why-you-shouldnt-freak-out-if-you-miss-a-payment-due-date">Here&#039;s Why You Shouldn&#039;t Freak Out If You Miss a Payment Due Date</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/heres-why-credit-scores-and-reports-are-not-the-same">Here&#039;s Why Credit Scores and Reports Are Not the Same</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/you-missed-a-student-loan-payment-now-what">You Missed a Student Loan Payment. Now What?</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-things-you-need-to-know-before-taking-out-a-personal-loan">10 Things You Need to Know Before Taking Out a Personal Loan</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-credit-repair-mistakes-that-will-cost-you">8 Credit Repair Mistakes That Will Cost You</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance credit bureaus credit report credit score Creditors favors forgiveness goodwill letter late payments lenders Mon, 12 Jun 2017 08:00:09 +0000 Dan Rafter 1961857 at http://www.wisebread.com How to Fix Your Finances After Missing a Payment http://www.wisebread.com/how-to-fix-your-finances-after-missing-a-payment <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/how-to-fix-your-finances-after-missing-a-payment" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/portrait_of_an_attractive_woman_at_table_grabbing_her_head.jpg" alt="Portrait of an attractive woman at table grabbing her head" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>No matter how much you plan ahead with your finances, sometimes you'll mess up a payment. Whether you miss a due date or bounce a check, take a deep breath. It's not as bad as you think.</p> <p>Let's review what you can expect to happen, how to fix the problem, and how you can make sure this doesn't happen again.</p> <h2>Missing a credit card payment</h2> <p>According to research from the Urban Institute, one in every 20 Americans is at least 30 days behind on a credit card payment or other nonmortgage type of debt. But you don't have to be that late to suffer consequences. Simply forgetting about a due date by a few days can land you in trouble.</p> <h3>What you can expect</h3> <p>Miss a credit card payment by as little as one day and you can be hit with a penalty fee. Late fees are capped by the Consumer Financial Protection Bureau at $27 for the first time you miss a due date; $38 for subsequent late payments within a six-month period. Those caps are adjusted for inflation every year.</p> <p>But fees aren't the only penalty for late credit card payments. Most credit card issuers will also hike up your APR, typically to between 20 percent and 35 percent. The Credit Card Act of 2009 requires the issuer to send you a notice saying why it is increasing your rate 45 days in advance of the rate hike, and the issuer can only apply the penalty rate to purchases made 14 days after the notice was sent. However, if you don't make at least the minimum payment within 60 days of the due date, the penalty APR can be applied to your <em>existing</em> balance as well as any future transactions. There is a chance to reverse that, though, if you make the next six payments on time.</p> <p>One silver lining exists for late payers: If your payment is less than 30 days past due, it will not be reported late to the credit bureaus.</p> <h3>How to fix it</h3> <p>If you make at least your minimum payment within 48 hours past the due date, your credit card company may credit you back any late payment fees.</p> <p>Many credit card companies offer a 24-hour or after-hours customer service line to accept late payments, but you will most likely need the routing and account numbers of your bank account to make the payment immediately. If that's not an option, then make the payment through the credit card's website. A last resort is to use the mailing address for courier deliveries provided on your credit card statement, if available, and overnight a check to the card issuer.</p> <p>Once you make your payment, request your credit card company waive or credit back your late payment fee and keep your standard APR (don't forget about that second item!). If approved, most credits may take up to two business days to be reflected in your balance.</p> <h3>How to prevent it</h3> <p>Your best bet is to set up automatic, recurring payments by no later than the bill's monthly due date. You can do this through your online banking platform, but payments made that way can take longer and are not as flexible as payments made through the credit card website. When you set up autopay with the card issuer, you can choose whether you want to pay the balance in full every month, make the minimum payment, or pay some other amount.</p> <p>If your current due date is causing you problems, call your credit card company and request a new date that's a better match with the timing of your incoming cash flow. Just be aware that this change can take two to three business cycles to take effect. (See also: <a href="http://www.wisebread.com/5-simple-ways-to-never-make-a-late-credit-card-payment?ref=seealso" target="_blank">5 Simple Ways to Never Make a Late Credit Card Payment</a>)</p> <h2>Missing a utility payment</h2> <p>Forgetting to pay the electric, gas, or water bill can threaten your service and may even harm your credit score.</p> <h3>What you can expect</h3> <p>Utility companies don't typically report payments directly to the three credit bureaus (Equifax, Experian, and TransUnion). But there's a wrinkle: If the companies send unpaid bills to collection agencies, then those agencies will <em>definitely</em> report the debts to the credit bureaus. How badly a debt in collections will hurt your credit score depends on how high your credit score is when the collections agency reports it. If you have a higher credit score, you'll lose more points.</p> <p>Most utility companies won't turn off your service for one late payment within 30 days, but they may do so after several missed payments. Consult your service agreement for applicable late payment fines. Before a utility company can shut down your service, it must have attempted to reach you and provided a final termination notice several days (or even weeks, in some states) in advance.</p> <h3>How to fix it</h3> <p>Don't ignore the bill. Pay it in full right away, or at least ask if your service provider will agree to a payment plan. As long as you're making agreed minimum payments, you'll continue to have access to the service and prevent the company from turning your debt over to a collector. Utility companies are usually willing to work with you to arrive at a solution. Taking initiative will prevent further headaches (and fees!) and keep the utility company from demanding a security deposit from you to continue service.</p> <h3>How to prevent it</h3> <p>Set up a recurring, automatic payment either directly with your utility company or through your financial institution. It's best to pay with a bank account rather than a credit card because many utility companies charge a convenience fee for processing credit cards, if they allow it at all.</p> <p>When using your bank's bill payment service, check the processing time for payments. Some institutions mail out physical checks to your payees, so you may have to account for mailing times.</p> <p>Don't have access to either option? Then consider a third-party bill payment service, such as <a href="http://www.mint.com" target="_blank">Mint</a>, <a href="http://paytrust.quicken.com" target="_blank">PayTrust</a>, or <a href="http://www.billgo.com/" target="_blank">BillGO</a>.</p> <p>Last but not least, consider finding ways to limit your water and electricity use to give your budget some breathing room. (See also: <a href="http://www.wisebread.com/34-smart-ways-to-cut-your-electric-bill?ref=seealso" target="_blank">34 Smart Ways to Cut Your Electric Bill</a>)</p> <h2>Bouncing a check</h2> <p>You wrote a check thinking you could cover it because a deposit you'd been waiting on had finally cleared your bank account, but it didn't. Now, your bank has sent you a notice that your check bounced.</p> <h3>What you can expect</h3> <p>First, let's talk about the actual payment: Your payee may or may not receive the money. Some banks won't process the payment at all. Other banks may ding your payee with an annoying fee. If the recipient of the check is a friend or family member, you may just get an earful. If it's a company or service provider, then you may have to pay them a fee.</p> <p>On top of that, your bank will charge you a fee. Depending on your type of account, you can expect one of these fees to kick in:</p> <ul> <li> <p>Overdraft fee: When your checking account comes with overdraft privilege, the charge is covered and your bank charges you an overdraft fee (average $32.13 in Q4 2016).</p> </li> <li> <p>Insufficient funds fee: When your checking account lacks overdraft protection, your check won't clear and your bank charges you an insufficient (or nonsufficient) funds fee (average $31.86 in Q4 2016).</p> </li> </ul> <h3>How to fix it</h3> <p>As soon as you notice the problem, make a deposit into your account to cover the amount of the bounced check and the applicable fee. If you have money in another account with the same bank, the fastest way to do this is by logging on to your bank's website or app and doing a transfer. If you don't have another account with the same bank, then head to your bank to make a cash deposit (a check deposit will take longer to clear).</p> <p>After making the deposit, contact your financial institution to request a one-time waiver of the overdraft or insufficient funds fee. Most banks are willing to credit back one of these charges to clients in good standing. Keep in mind, however, that they're under no obligation to do so.</p> <h3>How to prevent it</h3> <ul> <li> <p>Know the processing time for different types of deposits coming into your bank account. For example, some mobile check deposits can take up to three business days before they clear and the funds are available in your account.</p> </li> <li> <p>Keep track of your checks. Some checks, such as tax payment checks, are usually cashed after several days or even weeks. Forgetting about these may give you the illusion that you have a higher account balance than the one you actually have.</p> </li> <li> <p>Set up an emergency fund in a separate account with the same bank. That way you'll be able to tap into that account to cover that bad check right away.</p> </li> <li> <p>Sign up for mobile banking. This enables you to check and make transactions without stepping foot in a brick-and-mortar branch.</p> </li> </ul> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/damian-davila">Damian Davila</a> of <a href="http://www.wisebread.com/how-to-fix-your-finances-after-missing-a-payment">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/heres-why-you-shouldnt-freak-out-if-you-miss-a-payment-due-date">Here&#039;s Why You Shouldn&#039;t Freak Out If You Miss a Payment Due Date</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-late-payments-affect-your-credit">How Late Payments Affect Your Credit</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-credit-repair-mistakes-that-will-cost-you">8 Credit Repair Mistakes That Will Cost You</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-financial-mistakes-that-wont-hurt-your-credit-score">5 Financial Mistakes That Won&#039;t Hurt Your Credit Score</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-5-things-with-the-biggest-impact-on-your-credit-score">The 5 Things With the Biggest Impact on Your Credit Score</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance bills bounced checks collections credit report fees late payments missed payments past due penalties Tue, 30 May 2017 08:00:10 +0000 Damian Davila 1955480 at http://www.wisebread.com What to Do If You Have a Tax Lien On Your House http://www.wisebread.com/what-to-do-if-you-have-a-tax-lien-on-your-house <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/what-to-do-if-you-have-a-tax-lien-on-your-house" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/iStock-523154492_0.jpg" alt="Woman learning what to do with a tax lien on her house" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>The government doesn't play around with taxpayers who skip out on what they owe. When you ignore your federal, state, or property tax bills &mdash; and you don't make any attempts to pay the balance &mdash; the government can place a tax lien on your house.</p> <p>A tax lien is a legal claim on property for failure to pay taxes owed. It gives the tax authority (also known as the lienholder) first rights to your property over other creditors.</p> <p>A lien differs from a levy in that the government doesn't seize your house or other property. Keep in mind that a lien can become a levy at some point if you never pay your taxes or never make arrangements to satisfy the debt. The tax authority decides when to impose a levy. You'll receive written notice of the levy at least 30 days before it takes place.</p> <p>A lien is a serious matter because it can negatively affect your credit. Unpaid tax liens can remain on credit reports indefinitely, whereas paid tax liens can remain for up to seven years from the date filed.</p> <p>Of course, the best way to handle a tax lien is to avoid one in the first place. But if the damage is done, here's how to put this ugly mark behind you.</p> <h2>1. Dispute a filing error</h2> <p>It's not uncommon for mistakes to appear on credit reports. In fact, according to recent data from the Consumer Finance Protection Bureau, 76 percent of the 185,700 credit-reporting complaints they've received since 2011 are related to errors &mdash; including state or federal tax liens that mistakenly appeared on credit reports.</p> <p>If you check your credit report and find a lien reported in error, don't ignore this mistake. This can lower your credit score. Contact the IRS or your state tax office to file a dispute. If a review of your account proves that you don't owe the debt, the government withdraws the tax lien (as if it never happened). A withdrawal also removes the lien from your credit report.</p> <p>Thankfully, the number of tax liens reported in error should be dropping. In response to criticisms by the CFPB, the top consumer reporting agencies &mdash; Experian, Equifax, and TransUnion &mdash; issued a new provision. As of July 1, 2017, tax lien and civil judgment data will <a href="http://www.nasdaq.com/article/clearing-misconceptions-about-new-consumer-data-laws-cm772651" target="_blank">only be included on credit reports</a> if they contain three pieces of information: the person's name, address, and Social Security number or date of birth. This information must be current according to court records as of the last 90 days.</p> <p>The association representing the credit bureaus expects half of the consumers with tax liens on their credit reports will see them removed.</p> <h2>2. Pay your tax bill in full</h2> <p>Parting with your hard-earned money isn't easy, but paying your tax bill in full is one of the fastest ways to get the government off your back and move on with your life.</p> <p>Typically, the government releases tax liens within 30 days of full payment of an outstanding debt (including penalties and interest). A release removes the lien from the property.</p> <p>Unfortunately, paid tax liens can still remain on your credit report for up to seven years. However, under the IRS's Fresh Start Program, after paying your balance in full, you can submit a request to have a federal tax lien withdrawn from your credit report before the seven-year mark. Some states also give taxpayers the option of requesting an early withdrawal of a state tax lien from their credit report once they've paid their debt in full.</p> <h2>3. Set up an installment plan</h2> <p>If you can't pay what you owe in full, set up an installment plan with the government. This lets you pay off your tax debt over time. The tax authority releases the lien once you've set up a payment plan.</p> <p>In the case of federal debt, the IRS allows individual taxpayers to set up monthly direct debit payments on debt amounts up to $50,000 for up to six years. Go to IRS.gov and apply for installment payments through the online payment system. If you owe more than $50,000, or require longer repayment terms, request installment payments by completing and mailing Collection Information Statement Form 433-A or Form 433-F.</p> <p>Taxpayers who owe less than $25,000 and who've made at least three consecutive direct debit installment payments also can request to have the lien withdrawn from their credit report. However, defaulting on an installment agreement can trigger a new tax lien.</p> <p>Some states also allow installment plans to repay a tax debt, though the criteria for these plans varies by state.</p> <h2>4. Sell the property</h2> <p>If you don't have money to pay an outstanding tax debt in full, and you can't afford an installment plan, another option is selling the property and satisfying the debt with proceeds from the sale. However, this method only works if the sale price is high enough to pay off the lien and any existing mortgages on the property. If the sale won't generate enough proceeds to pay off attached liens, you can't sell the property. If you're able to sell the home, the company handling your escrow account forwards payment to the lienholder after closing.</p> <p>Keep in mind that you'll need to contact the lienholder before closing to request a lien release. In the case of federal taxes, this involves requesting a Certificate of Discharge from the IRS. If the request is approved, this document releases (or removes) the lien from the asset being sold (though it stays in place in every other way), and allows the property to transfer to the new owner lien-free.</p> <h2>5. Refinance the property</h2> <p>Then again, maybe you don't want to sell your home. There's also the option of refinancing and borrowing cash from your home equity to satisfy a state or federal tax lien on the property. Since refinancing replaces an existing mortgage with a new loan, mortgage lenders will not approve your loan application unless they have first lien position on the title. This puts the lender in priority position to benefit from liquidation if the property goes into default. For this to happen, you'll have to request a lien subordination from the IRS or your state tax office before applying for the loan.</p> <p>Subordination doesn't eliminate a tax lien &mdash; rather, the lien becomes secondary to a lender's lien on the property. And with the lender's security interest first, you're more likely to acquire a new mortgage.</p> <p>Be aware that your ability to refinance depends on how the tax lien impacted your credit. A tax lien will reduce your credit score, and to refinance, you'll have to meet a lender's income and credit score requirements. You need a minimum credit score of 620 for a conventional loan and a minimum credit score between 500 and 580 for an FHA loan.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/mikey-rox">Mikey Rox</a> of <a href="http://www.wisebread.com/what-to-do-if-you-have-a-tax-lien-on-your-house">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-8"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/9-money-moves-to-make-the-moment-your-credit-cards-are-paid-off">9 Money Moves to Make the Moment Your Credit Cards Are Paid Off</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/heres-what-happens-if-you-dont-pay-your-taxes">Here&#039;s What Happens If You Don&#039;t Pay Your Taxes</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/top-three-tax-facts-to-know-for-2016">Top Three Tax Facts to Know for 2016</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/get-your-money-sooner-by-starting-2016-tax-prep-now">Get Your Money Sooner by Starting 2016 Tax Prep Now</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/not-so-fast-5-things-you-must-do-after-filing-taxes">Not So Fast! 5 Things You Must Do After Filing Taxes</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Real Estate and Housing Taxes credit report credit score federal filing errors government IRS payment plans property refinancing state tax bills tax liens taxpayers Mon, 17 Apr 2017 08:30:08 +0000 Mikey Rox 1928274 at http://www.wisebread.com 6 Credit Card Mistakes That Could Be Ruining Your Credit http://www.wisebread.com/6-credit-card-mistakes-that-could-be-ruining-your-credit <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/6-credit-card-mistakes-that-could-be-ruining-your-credit" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/iStock-585795908.jpg" alt="Woman learning credit card mistakes that could be ruining her credit" title="" class="imagecache imagecache-250w" width="250" height="142" /></a> </div> </div> </div> <p>It's difficult to overstate how important your credit record and credit score are. Not only will <a href="http://www.wisebread.com/what-is-a-good-credit-score-range?ref=internal" target="_blank">good credit</a> enable you be approved for the <a href="http://www.wisebread.com/5-best-credit-cards-for-people-with-excellent-credit?ref=internal" target="_blank">most attractive credit cards</a>, it's vital for receiving the lowest rates on a car loan, a mortgage, and on home and auto insurance premiums. It can even make the difference in whether you get the apartment or job you want, since both landlords and employers often run credit checks on applicants. (See also: <a href="http://www.wisebread.com/15-surprising-ways-bad-credit-can-hurt-you?ref=seealso" target="_blank">15 Surprising Ways Bad Credit Can Hurt You</a>)</p> <p>Unfortunately, many credit card users are making big mistakes that are ruining their credit. Since it can take years for some of the most negative items to drop off your credit report, it's crucial to avoid making these mistakes in the first place. Here are six credit card mistakes that could be ruining your credit.</p> <h2>1. Paying Late<strong> </strong></h2> <p>The most important factor in your FICO score &mdash; the most popular credit score lenders use to evaluate you &mdash; is your payment history. It makes up 35% of your score. (See also: <a href="http://www.wisebread.com/the-5-things-with-the-biggest-impact-on-your-credit-score?ref=seealso" target="_blank">5 Things with the Biggest Impact on Your Credit Score</a>)</p> <p>If you are using a credit card, your first priority should be to <em>always </em>pay your credit card bill on time. While one bill paid a few days late won't cause lasting damage to your credit score, paying late frequently will hurt more. On top of that you'll usually be subject to late fees.</p> <p>Thankfully, there are many tools to help you pay on time. Most credit card issuers offer automatic payments to ensure that you never pay late. You can also request a specific payment due date so you can arrange all your bills to be due at the same time each month. That way you can sit down and pay bills just once a month rather than keeping track of various bills as they come in. Additionally, you can sign up for payment reminders by email or text.</p> <h2>2. Paying Less Than the Minimum<strong> </strong></h2> <p>Paying just the minimum payment on your credit cards will <a href="http://www.wisebread.com/all-the-ways-minimum-payments-are-evil?ref=internal" target="_blank">hurt you financially</a>, but paying below that is even worse &mdash; much worse.</p> <p>To avoid being considered delinquent on a credit card account, you not only have to make your payments on time, but the payments must be <em>at least </em>the minimum amount required, which is stated on your bill. If your payment is below the minimum, it doesn't matter if it was on time. The payment will still be considered late, causing a hit to your credit score.</p> <h2>3. Failing to Pay<strong> </strong></h2> <p>Miss a payment for at least 60 days and your creditors start wondering if you're going to pay at all. That's why you'll start to see more serious consequences than a single lapse of a few days would cause. After two missed billing cycles an issuer can impose a high <a href="http://www.wisebread.com/everything-you-didn-t-understand-about-credit-card-interest-grace-periods-and-penalty-aprs?ref=internal" target="_blank">penalty interest rate</a> on the account, on top of late fees. And while those charges alone are costly, your credit will also start to really suffer.</p> <p>A payment that's 90 days overdue is extremely damaging to your credit score and takes seven years to fall off your credit record. At 120 days late, your debt will likely be <a href="http://www.wisebread.com/what-happens-when-your-credit-card-debt-is-charged-off?ref=internal" target="_blank">charged off</a> and sold to collectors, which harms your credit score even more. (See also: <a href="http://www.wisebread.com/heres-what-to-do-if-you-cant-pay-your-bills-on-time?ref=seealso" target="_blank">What to Do If You Can't Pay Your Bills on Time</a>)</p> <p>If you are unable to pay your credit card bill for any reason, you should reach out to your card issuer to let them know. You may be able to <a href="http://www.wisebread.com/4-ways-to-negotiate-credit-card-debt" target="_blank">negotiate a debt repayment plan</a>.</p> <h2>4. Having High Balances<strong> </strong></h2> <p>After payment history, the second most important factor in your credit score is how much you owe. It accounts for 30% of your FICO score. Maxing out your credit cards, or coming close to it, hurts your credit score.</p> <p>Ideally you want your <a href="http://www.wisebread.com/this-one-ratio-is-the-key-to-a-good-credit-score?ref=internal" target="_blank">credit utilization ratio</a> &mdash; the amount of debt you have divided by your total available credit &mdash; to be below 30%. The lower you can get it, the better off your credit score will be. The best way to lower it is to <a href="http://www.wisebread.com/fastest-way-to-pay-off-10000-in-credit-card-debt?ref=internal" target="_blank">pay off your balances quickly</a>. (See also: <a href="http://www.wisebread.com/5-day-debt-reduction-plan-pay-it-off" target="_blank">5-Day Debt Reduction Plan: Pay It Off</a>)</p> <h2>5. Not Having Enough Credit Cards<strong> </strong></h2> <p>The other way to lower your credit utilization ratio is to increase the amount of available credit you have. If you have just one or two credit cards, and you are using up most of the credit lines available on them, you may benefit from having another card &mdash; but only if you can resist the temptation to ring up a bunch more debt on it. Remember, raising your credit line only to add more debt will drop your credit score.</p> <p>Pick a basic, <a href="http://www.wisebread.com/the-5-best-credit-cards-with-no-annual-fees?ref=internal" target="_blank">no-annual-fee card</a> and then use it once a month or so for a small purchase, such as a tank of gas, that you can pay off immediately. That will keep the account active without putting you in debt. (See also: <a href="http://www.wisebread.com/ask-these-7-questions-to-help-choose-the-perfect-credit-card?ref=seealso" target="_blank">7 Questions to Ask to Help Choose the Perfect Credit Card</a>)</p> <p>Similarly, you could request a credit line increase for the accounts you already have. If you've been paying on time, chances are you can get a credit limit increase by simply calling your issuer and asking.</p> <p>Just be aware that credit card issuers will pull your credit report before approving you for a new credit card, and usually for a credit line increase, too. This will result in a hard pull on your credit, which will ding your credit score. Even a few points could be important if you're about to apply for a mortgage, so wait to ask for new credit until after you've done that.</p> <h2>6. Canceling Your Oldest Credit Cards<strong> </strong></h2> <p>Closing any credit card will raise your credit utilization ratio, but closing your oldest accounts harms a different part of your credit score. Your length of credit history accounts for 15% of your FICO score. While an account in good standing will remain on your credit report for about 10 years after you've closed it, it will eventually be removed and hurt your score. (See also: <a href="http://www.wisebread.com/5-times-its-okay-to-close-a-credit-card?ref=seealso" target="_blank">5 Times It's Okay to Close a Credit Card</a>)</p> <p>If you don't need to use a card, it may be better to put the card in a secure location, but keep the account open. If the account has an annual fee, you can ask to have the fee waived, or the account changed to a different card without the annual fee.</p> <p>Don't let these credit card mistakes ruin your credit. (See also: <a href="http://www.wisebread.com/how-to-use-credit-cards-to-improve-your-credit-score?ref=seealso" target="_blank">How to Use Credit Cards to Improve Your Credit Score</a>)</p> <h2 style="text-align: center;">Like this article? Pin it!&nbsp;</h2> <p>&nbsp;</p> <p style="text-align: center;"><a href="//www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F6-credit-card-mistakes-that-could-be-ruining-your-credit&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F6%20Credit%20Card%20Mistakes%20That%20Could%20Be%20Ruining%20Your%20Credit_0.jpg&amp;description=6%20Credit%20Card%20Mistakes%20That%20Could%20Be%20Ruining%20Your%20Credit" data-pin-do="buttonPin" data-pin-config="above" data-pin-color="red" data-pin-height="28"><img src="//assets.pinterest.com/images/pidgets/pinit_fg_en_rect_red_28.png" alt="" /></a> </p> <!-- Please call pinit.js only once per page --><!-- Please call pinit.js only once per page --><script type="text/javascript" async defer src="//assets.pinterest.com/js/pinit.js"></script></p> <p style="text-align: center;">&nbsp;<img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/6%20Credit%20Card%20Mistakes%20That%20Could%20Be%20Ruining%20Your%20Credit_0.jpg" alt="6 Credit Card Mistakes That Could Be Ruining Your Credit" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/jason-steele">Jason Steele</a> of <a href="http://www.wisebread.com/6-credit-card-mistakes-that-could-be-ruining-your-credit">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/need-a-game-to-learn-to-manage-your-credit">Need a game to learn to manage your credit?</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-rebuild-your-credit-in-8-simple-steps">How to Rebuild Your Credit in 8 Simple Steps</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-use-credit-cards-to-improve-your-credit-score">How to Use Credit Cards to Improve Your Credit Score</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-ways-life-is-amazing-with-an-800-credit-score">5 Ways Life Is Amazing With an 800 Credit Score</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-avoid-getting-your-credit-card-canceled">How to Avoid Getting Your Credit Card Canceled</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Credit Cards budgets credit credit rating credit report credit score money mistakes Tue, 21 Feb 2017 10:31:29 +0000 Jason Steele 1892848 at http://www.wisebread.com 7 Money Moves You Will Always Be Thankful For http://www.wisebread.com/7-money-moves-you-will-always-be-thankful-for <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/7-money-moves-you-will-always-be-thankful-for" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/family_piggy_bank_72948583.jpg" alt="Family making money moves they&#039;ll always be thankful for" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>The air is crisp and the time for family, friends, and fun is upon us! But are you ready for the tons of holiday spending and planning ahead for 2017? Read up on these seven money moves you will always be thankful for/</p> <h2>1. Monitoring Your Credit</h2> <p>Whether you've already got a mortgage, cars, and all the trimmings, or you're a young adult with the hopes of buying an asset like a house someday, you'll need to maintain good credit. Everyone gets one <a href="http://www.wisebread.com/how-to-get-a-truly-free-credit-report">free credit report</a> each year, and some credit card companies even give you regular updates on your credit score. I know, we love to remind you of this! But when you're meeting with the realtor and they don't laugh at your borrowing limit, you'll be saying thanks.</p> <h2>2. Negotiating Your Insurance</h2> <p>When shopping around for insurance, it's easy to settle for the first average quote you receive and end it. It's boring! But it really is best to gather several quotes to gain some leverage. If there's a company you prefer, show them the cheaper quote and get them to lower theirs. Also, try to ask yourself which types of insurance you actually need. When you've saved hundreds of dollars per year in insurance costs, it'll be easier to agree to host Thanksgiving at your place next time.</p> <h2>3. Stowing Cash Into a Mutual Fund or ETF</h2> <p>How many ways should you save money? Even if you already have some mutual funds in your 401K, even if you have a vacation savings jar in the kitchen &mdash; you might want to consider stowing some cash from your savings account separately in a mutual fund or ETF. They're steady, the rate is far superior to a savings account, and it keeps you from feeling like your savings can be tapped at any time. It takes some thought and some calculus of weighing the fees and taxes to decide whether to take the funds out. Sometimes we need that bit of a barrier so that we can benefit in the long run. Check out <a href="http://www.wisebread.com/9-top-mutual-funds-for-low-risk-investors">these tips for investors</a>. Your future self will be thanking you down the line.</p> <h2>4. Paying Off High-Interest Debt</h2> <p>Carrying balances on one (or a few) high-interest cards? If you have debt at anything above 10% interest, paying those off should be your priority. The longer you carry those balances, the more precarious the situation gets. And of course, if you were to follow the first point in this list, it would be pretty hard without paying off that <a href="http://www.wisebread.com/5-ways-to-pay-off-high-interest-credit-card-debt?ref=internal">high-interest debt</a>. Once that's done, you can pass the savings around the table.</p> <h2>5. Building an Emergency Fund</h2> <p>Why wouldn't you want to be covered if a small emergency happened? Consider the emergency fund as your war chest, defending you from calamities such as car accidents, sudden house repairs, a child getting sick, or getting stuck with unpaid jury duty. <a href="http://www.wisebread.com/change-jars-and-8-other-clever-ways-to-build-an-emergency-fund">Even broke folks</a> can start one. Keep it somewhere easy to access, and by all means, never pilfer it for Black Friday. That's what #7 is for!</p> <h2>6. Getting Your Taxes Done Early</h2> <p>Who doesn't want to get their money early? Or get tax stress off their chests? Starting around November, you really should be gathering your receipts and <a href="http://www.wisebread.com/avoid-the-tax-season-rush-with-these-early-prep-steps">setting a tax plan</a> &mdash; whether you need to book an appointment with your accountant, or book some personal time in front of QuickBooks. What easier way to be thankful all the way into the dark of January than knowing a refund check is on its way?</p> <h2>7. Setting a Christmas Budget</h2> <p>Going into Thanksgiving with a shopping list and wondering, &quot;How am I gonna do this <em>and </em>Christmas?&quot; Fix that in the future with a <a href="http://www.wisebread.com/avoid-these-5-common-holiday-budget-pitfalls">Christmas budget set in advance</a>. Even if you're a family who slowly buys gifts for each other year-round, that can creep up. By having a set budget every year, you can check against immediately clicking &quot;add to cart.&quot; Imagine how nice it would be to not feel completely tapped out after the holidays. Just get through Thanksgiving and everything else is gravy.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/amanda-meadows">Amanda Meadows</a> of <a href="http://www.wisebread.com/7-money-moves-you-will-always-be-thankful-for">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-6"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-money-moves-every-new-college-student-should-make">7 Money Moves Every New College Student Should Make</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-signs-youre-making-all-the-right-money-moves">6 Signs You&#039;re Making All the Right Money Moves</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-money-moves-to-make-before-the-leaves-change">10 Money Moves to Make Before the Leaves Change</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/where-to-turn-for-help-when-you-dont-have-an-emergency-fund">Where to Turn for Help When You Don&#039;t Have an Emergency Fund</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-easy-ways-to-build-an-emergency-fund-from-0">7 Easy Ways to Build an Emergency Fund From $0</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance being thankful credit report debt emergency funds money moves savings taxes Thanksgiving Mon, 14 Nov 2016 09:00:06 +0000 Amanda Meadows 1830894 at http://www.wisebread.com 6 Money Moves You Can Make While Stuck in an Endless TSA Line http://www.wisebread.com/6-money-moves-you-can-make-while-stuck-in-an-endless-tsa-line <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/6-money-moves-you-can-make-while-stuck-in-an-endless-tsa-line" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/man_tsa_line_20741660.jpg" alt="Man making money moves in endless TSA line" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>At the airport closest to me, the TSA lines are legendary, especially during the holiday season. Last year, they were telling people to give themselves <em>an extra hour</em> before their flight, just to make sure they got through security on time. That's an extra hour on top of the usual hour or two recommended!</p> <p>I don't know about you, but I dread long lines. I spend the entire time thinking about what else I could be doing. Over the years, though, I've come up with ways to use my &quot;line time&quot; well. Here are a few things you can do to improve your financial life while waiting for TSA to get on the ball.</p> <h2>1. Start Using Mint</h2> <p><a href="http://mint.com">Mint</a> is a great way to track your finances. You sign up for an account, connect all of your bank, investment, and debt accounts, and it quietly tracks your overall financial situation. It allows you to look at spending, debt, and net worth automatically and with ease.</p> <p>This is a great thing to do if you're not really tracking your finances right now, or if you don't have a handle on your overall financial situation. Starting with the big picture is almost always a good idea, so that you know what is good and what is bad, right from the start.</p> <h2>2. Sign Up for Digit</h2> <p><a href="http://digit.co">Digit</a> is an online service that saves money for you. You connect the app to a bank account, and they track your spending. Based on what they find, they schedule automatic withdrawals to another account. They don't say much about their analysis algorithm, but people (myself included) claim that they don't notice or need the money that Digit removes from their accounts.</p> <p>If you're already saving, you probably don't need this tool. But if you forget to pay yourself first, this can be a great way to save without really thinking about it. And it's fun to watch your savings build up over time!</p> <h2>3. Check Your Credit</h2> <p>If you haven't looked at your free credit report in the last 12 months, you should. <a href="http://annualcreditreport.com">AnnualCreditReport.com</a> is the place to start. From there, you can enter identification information and view a report from each of the three credit reporting agencies: TransUnion, Experian, and Equifax. Check for incorrect information or credit cards/lines of credit that may have been opened fraudulently.</p> <p>Do make sure that you have a secure Internet connection before you start sharing sensitive personal information. If you aren't sure, add this to your To Do list and work on something else while you're in line.</p> <h2>4. Set a Financial Goal</h2> <p>What would you like your money to do for you? Do you want to travel? Maybe you need to buy a new car. Think about your wants and needs, and choose one or two financial goals for the next few months. Having a goal will help you focus, and it will make you more likely to do things like curb spending or follow through on a savings plan.</p> <p>Don't set too many goals, though. Picking one or two things to save for &mdash; maybe one practical thing and one that's fun &mdash; will give you plenty of motivation without the stress of feeling like your money has to go in too many different directions.</p> <h2>5. Choose a Charity</h2> <p>If you're like me, giving often falls by the wayside. It's not that I don't want to do it, but that I want to be responsible with it. If you want to make sure that any charity that gets your money is actually using it for their stated purposes, do your research while you stand in line.</p> <p>Start by going to your intended charity's website. Most of them will offer some sort of fiscal documentation. If you want to give to a smaller charity, you may need to give them a call and ask for it, instead.</p> <p>If you don't even know where to start giving, start with a simple Google search. Pick an issue that is important to you, and look for charities that target it. You can even limit your search to charities in your local area, if you're interested in volunteering or getting more involved.</p> <h2>6. Check Your Bills</h2> <p>Not sure how long you'll be in line? Pull up your latest credit card bills and glance through them. Make sure that you recognize all the charges and that, to the best of your knowledge, they are for the right amount. Many people find mistakes on their credit card bills, and you can always contact the company to have them fixed. That usually means more money in your pocket.</p> <p>If you don't recognize a charge but you aren't sure, flag it for later, when you can go through your receipts and figure out if it's correct. If you find something very concerning, call your credit company from the line. The sooner you can get in touch with them, the sooner you'll have your money back where it belongs.</p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <p>&nbsp;</p> <p style="text-align: center;"><a href="//www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2F6-money-moves-you-can-make-while-stuck-in-an-endless-tsa-line&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2F6%20Money%20Moves%20You%20Can%20Make%20While%20Stuck%20in%20an%20Endless%20TSA%20Line.jpg&amp;description=6%20Money%20Moves%20You%20Can%20Make%20While%20Stuck%20in%20an%20Endless%20TSA%20Line" data-pin-do="buttonPin" data-pin-config="above" data-pin-color="red" data-pin-height="28"><img src="//assets.pinterest.com/images/pidgets/pinit_fg_en_rect_red_28.png" alt="" /></a> </p> <!-- Please call pinit.js only once per page --><!-- Please call pinit.js only once per page --><script type="text/javascript" async defer src="//assets.pinterest.com/js/pinit.js"></script></p> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/6%20Money%20Moves%20You%20Can%20Make%20While%20Stuck%20in%20an%20Endless%20TSA%20Line.jpg" alt="6 Money Moves You Can Make While Stuck in an Endless TSA Line" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/sarah-winfrey">Sarah Winfrey</a> of <a href="http://www.wisebread.com/6-money-moves-you-can-make-while-stuck-in-an-endless-tsa-line">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-3"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-sign-up-for-global-entry">How to Sign Up for Global Entry</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/first-rule-of-financial-wins-avoid-losses">First Rule of Financial Wins: Avoid Losses</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/11-ways-to-prepare-for-your-best-black-friday">11 Ways to Prepare for Your Best Black Friday</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-money-moves-every-new-college-student-should-make">7 Money Moves Every New College Student Should Make</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-apps-that-monitor-your-credit-for-you">7 Apps That Monitor Your Credit for You</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance Travel airports apps bills budgeting charity credit report digit free time mint money moves security tsa waiting in line Thu, 10 Nov 2016 10:30:29 +0000 Sarah Winfrey 1830272 at http://www.wisebread.com 9 Money Moves to Make the Moment Your Credit Cards Are Paid Off http://www.wisebread.com/9-money-moves-to-make-the-moment-your-credit-cards-are-paid-off <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/9-money-moves-to-make-the-moment-your-credit-cards-are-paid-off" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_happy_credit_card_000089299163.jpg" alt="Woman making money moves after credit cards are paid off" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>It may have taken years. It may have required an unprecedented level of discipline and patience. But you finally have your credit cards paid off.</p> <p>Congratulations! Now, what do you do?</p> <p>With a good chunk of your high-interest debt no longer weighing you down, you can truly start to work your way toward financial freedom. Here are some key financial moves you can make immediately.</p> <h2>1. Tackle Any Other High-Interest Debt</h2> <p>Okay, so you crushed the credit card debt. What else do you owe? Take a look at things like auto loans, student loans, and your mortgage, and begin chipping away at that debt, as well. Go after the debt with the highest interest rate first. It's one thing to free of credit card debt, but to be totally, 100% debt free? That's an amazing feeling.</p> <h2>2. Assess Your Emergency Fund</h2> <p>When you're in debt, there's a good chance you don't have a lot of liquid savings. But now that those credit cards are paid off, you can start building up funds in case of a major unexpected expense or loss of income. By maintaining an account with at least three months of income, you can handle any financial crisis and know that you won't go back into debt.</p> <h2>3. Open a Retirement Account</h2> <p>It's impossible to think about retirement when you're huddled under a mountain of debt. But now that you've shed that high interest debt, you can start thinking about your long-term financial goals, including your retirement. If your employer offers a 401K plan, begin contributing now and seek to maximize the company match. (Usually, this is somewhere in the neighborhood of 5% of your income, though you can always contribute more.) Also consider opening an individual retirement account, or IRA. Opening a Roth IRA, which allows your money to grow tax free, is perfect for people who are self-employed, but is also a great complement to a 401K.</p> <h2>4. Find a Good Online Budgeting Tool</h2> <p>If you haven't already done so, consider using a service such as Mint or <a href="http://track.flexlinks.com/a.ashx?foid=1029882.216060&amp;fot=9999&amp;foc=1&amp;foc2=582907">Personal Capital</a>, which allows you to view all of your account information in one place and track your spending &mdash; even set up budgets and goals. Using one of these services will allow you to see exactly where your money is going, so you can adjust your spending, if needed.</p> <h2>5. Stop Using Your Cards for a While (But Don't Close Them)</h2> <p>Credit cards got you into trouble, so it might be good to just put them on ice for a while. But don't start canceling all your cards. If you close credit cards, you may actually hurt your credit score. You'll no longer have accounts with a long history, and your <a href="http://www.wisebread.com/this-one-ratio-is-the-key-to-a-good-credit-score">credit utilization ratio</a> will go up because you'll have less available credit. If you feel the need to get rid of cards, shed the one with the lowest credit limit. (See also: <a href="http://www.wisebread.com/the-best-0-balance-transfer-credit-cards?utm_source=wisebread&amp;utm_medium=seealso&amp;utm_campaign=cc_article">Best 0% Balance Transfer Credit Cards</a>)</p> <h2>6. Develop a New Charging Philosophy</h2> <p>If you successfully transitioned from carrying a credit card balance to being debt-free, you probably made an adjustment to how you use your cards. Now it's time to evaluate again how you use credit to ensure you stay out of the red. Do some research to find credit cards with favorable interest rates (and maybe even some good <a href="http://www.wisebread.com/5-best-cash-back-credit-cards?utm_source=wisebread&amp;utm_medium=internal&amp;utm_campaign=cc_article">cash back rewards</a>). Set up automatic transfers to pay off balances in full each month, and come up with rules to guide which purchases will be made with credit and which will be made with cash. It takes discipline to get out of debt, but it's just as much work to stay out. So set up a plan and do your best to stick to it.</p> <h2>7. Begin Saving for Big, Important Things</h2> <p>You may be out of debt, but you know that it could come right back if you don't save responsibly for the big ticket items. Whether it's a new house, car, or home appliance, it's best to try and pay for these things without taking on a lot of new debt. Consider taking whatever you were paying in credit card interest and setting it aside into a savings account, or even an index fund. Being able to pay cash for the pricey purchases will keep you from falling into the abyss of debt again.</p> <h2>8. Review Your Credit Reports</h2> <p>Looking at your credit report can be depressing when you're in debt. Who needs another reminder of how much they owe? But now that the debt is gone, it might be a good time to examine your credit reports to see if there are any errors, or even old debts you may have forgotten about. Your goal now is to improve your FICO credit score, and cleaning up your reports can play a big role in that. Each of the three major credit bureaus (TransUnion, Experian, Equifax) provide a copy of your credit report once a year at no charge.</p> <h2>9. If You Have a Mortgage, Think About Refinancing</h2> <p>Your credit score may not improve right away after paying off your credit card debt, but if you keep yourself debt-free, it will rise over time. And that means that you'll be in a better position to negotiate with lenders for a better interest rate on your home loan. Mortgage rates are still historically low, so you might save thousands of dollars over the long-term by reducing your rate even slightly. And you could have enormous savings by reducing your loan term, as well.</p> <p><em>Have you paid off your credit card debt? What money moves did you make?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/tim-lemke">Tim Lemke</a> of <a href="http://www.wisebread.com/9-money-moves-to-make-the-moment-your-credit-cards-are-paid-off">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/dont-start-a-family-before-reaching-these-5-money-goals">Don&#039;t Start a Family Before Reaching These 5 Money Goals</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-simple-money-milestones-anyone-can-hit">6 Simple Money Milestones Anyone Can Hit</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-financial-resolutions-you-can-conquer-before-new-years">10 Financial Resolutions You Can Conquer Before New Year&#039;s</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/heres-why-you-shouldnt-freak-out-if-you-miss-a-payment-due-date">Here&#039;s Why You Shouldn&#039;t Freak Out If You Miss a Payment Due Date</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-financial-decisions-youll-never-regret">8 Financial Decisions You&#039;ll Never Regret</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance credit report credit score emergency fund high interest debt refinancing retirement saving money Wed, 11 May 2016 10:30:05 +0000 Tim Lemke 1705411 at http://www.wisebread.com 5 Times You Must Freeze Your Credit Report http://www.wisebread.com/5-times-you-must-freeze-your-credit-report <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/5-times-you-must-freeze-your-credit-report" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/man_identity_theft_000023163541.jpg" alt="Man learning when to freeze his credit report" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>No one should have access to your credit report without your consent. A security freeze can help prevent a credit reporting company from releasing your credit report, which prevents new creditors and third parties from being able to view your report and score. Consider the following circumstances in which freezing your credit report might be appropriate.</p> <h2>1. You're a Victim of Identity Theft</h2> <p>If you believe you have been a victim of identity theft or that someone is making charges to your accounts without your consent, then it's time to place a freeze on your credit report. In fact, depending on your state security freeze law, you may even be eligible for free security freeze services.</p> <p>On average, victims of identity theft need to spend about 40 hours to clean up their credit once a thief has opened an account in their name. With the security freeze in place, you won't have to worry about that, because it prevents new accounts from being opened. (See also: <a href="http://www.wisebread.com/the-comprehensive-guide-to-identity-theft-everything-you-need-to-know?ref=seealso">The Comprehensive Guide to Identity Theft: Everything You Need to Know</a>)</p> <p>Keep in mind that placing a freeze on your credit file only prevents a fraudster from opening new accounts in your name. It doesn't prevent them from accessing any of your existing credit cards. While new creditors will not be able to access your account, it's important to remember that businesses that you already have an existing relationship with can still access your credit history.</p> <h2>2. You've Been Subjected to a Security Breach</h2> <p>Even if you aren't currently a victim of identity theft, but are concerned that your information may be released to people or companies without your consent, you can block access to your credit report with a freeze. If you have reason to believe that you may soon be a victim of identity theft, then a freeze may be the right preemptive step to ensure you don't have big problems in the near future. For instance, if your wallet or mail were stolen, or your social security number was part of a security breach, then placing a security freeze on your file will prevent a thief from using your information.</p> <p>If only your credit or debit card information has been stolen, a security freeze is not necessarily vital. In these cases, you may be better off simply requesting credit monitoring services, placing a fraud alert, or freezing those particular cards so that no one can use them.</p> <h2>3. You Don't Need Credit Right Now</h2> <p>If you believe you won't need to apply for credit anytime in the near future, and want to gain maximum control of your credit score, a security freeze may be appropriate for you. The advantages of a credit freeze increase with age because as people get older, they generally don't need credit as much. Therefore, placing a freeze on your account will just ensure that nobody else can apply for credit in your name, either.</p> <h2>4. You're Going Through a Messy Divorce</h2> <p>Many people involved in messy divorces place a freeze on their credit. This ensures that your spouse is not able to open any new accounts with your identity, as they will likely have all of your personal information.</p> <h2>5. You're Protecting Your Child's Credit</h2> <p>Have you ever received credit card offers in the mail for your children? You may consider placing a protected credit freeze on <em>their </em>file to prevent any fraudulent accounts from being opened in their name. A protected consumer freeze can be requested by the parent or legal guardian of a minor or medically incapacitated consumer.</p> <h2>How to Place a Security Freeze on Your Credit File</h2> <p>You can place a freeze on your credit files at each of the three major credit reporting agencies, <a href="https://www.freeze.equifax.com/Freeze/jsp/SFF_PersonalIDInfo.jsp">Equifax</a>, <a href="https://www.experian.com/freeze/center.html">Experian</a>, and <a href="https://freeze.transunion.com/sf/securityFreeze/landingPage.jsp">TransUnion</a>. You can follow a simple online process, request the freeze by phone, or submit your request in writing. Keep in mind that you will need to follow this process for all three credit bureaus. At minimum, you will need to supply your name, address, social security number, date of birth, and other basic personal information.</p> <p>Once the freeze has been placed on your account, your credit report will be inaccessible unless you provide specific authorization with a password or 10-digit personal identification number (PIN). The freeze will remain on your credit file until you request that it be removed.</p> <h3>The Costs Involved</h3> <p>In most cases, it will cost $2&ndash;$15 per person, per bureau to freeze your credit report. However, the fees will vary by state and scenario. For instance, some states won't charge people over age 62 or under age 19, so you should refer to your state's data.</p> <h3>Temporarily Lifting the Freeze</h3> <p>Once you receive the password or PIN for your account, you will be able to authorize the temporary release of your credit report for a specific period of time or for a specific person. You can request that the freeze be lifted for anywhere from one day to one year. Keep in mind that you will need to contact all three credit bureaus to request that the freeze be temporarily lifted.</p> <h3>Applying for New Credit</h3> <p>According to Experian, having a security freeze can affect the approval of any request or application for &quot;a new loan, credit, mortgage, insurance, government services or payments, rental housing, employment, investment, license, cellular telephone, utilities, digital signature, Internet credit card transaction or other services, including an extension of credit at point of sale.&quot; If you are considering applying for credit, keep in mind that a security freeze can slow down the application. Try removing the freeze at least three business days before applying for new credit.</p> <h3>Don't Take a Credit Freeze Lightly</h3> <p>Keep in mind that a credit freeze is a major step that will completely remove you from the credit marketplace, so it should only be pursued on an as-needed basis. For instance, if you've applied for a new job or apartment and they need to see your credit file, having a freeze in place will result in unnecessary delays. On the other hand, it will not adversely impact your credit score or your chances of getting credit once the freeze has been lifted.</p> <p><em>Have you ever placed a freeze on your credit report? Please share your experience in the comments!</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/andrea-cannon">Andrea Cannon</a> of <a href="http://www.wisebread.com/5-times-you-must-freeze-your-credit-report">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-protect-your-credit-after-the-equifax-breach">How to Protect Your Credit After the Equifax Breach</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-protect-elderly-loved-ones-from-financial-scams">How to Protect Elderly Loved Ones From Financial Scams</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/9-signs-your-identity-was-stolen">9 Signs Your Identity Was Stolen</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-protect-your-child-from-identity-theft">How to Protect Your Child From Identity Theft</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-spot-a-credit-repair-scam">How to Spot a Credit Repair Scam</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance credit freeze credit report fraud identity theft security freeze Tue, 15 Mar 2016 11:00:06 +0000 Andrea Cannon 1672232 at http://www.wisebread.com How Credit Inquiries Affect Your Credit Score http://www.wisebread.com/how-credit-inquiries-affect-your-credit-score <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/how-credit-inquiries-affect-your-credit-score" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_reading_paperwork_000062937852.jpg" alt="Woman learning how credit inquiries affect her credit score" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Have you noticed inquiries on your credit report? Not sure what they mean? Soft and hard inquiries are the result of potential creditors assessing your credit report after you've applied for things such as a credit card, mortgage, or car loan. Hard and soft inquiries each affect your credit differently. Read on to learn more:</p> <h2>What Are Soft Inquiries?</h2> <p>Soft inquiries typically occur when your credit report is pulled for a background check. This can occur when you are applying for a new job, getting pre-approved for lending offers, and even when you check your own credit score.</p> <p>While they will usually show up on your credit report, this isn't always the case. Plus, they won't affect your credit score, so you don't need to be concerned about them.</p> <h2>What Are Hard Inquiries?</h2> <p>Hard inquiries occur when a lender pulls your credit report to make a lending decision. This takes place most commonly when you apply for a loan, credit card, or mortgage. However, there are other reasons that your credit may reflect a hard inquiry, such as when you request a credit limit increase. They can, in some cases, lower your FICO score by one to five points and can remain on your credit report for up to two years. Typically, the more hard inquiries on your credit report, the likelier it is to affect your score.</p> <p>Multiple hard inquiries in a short period of time can cause significant damage to your credit. When multiple hard inquiries come through at once, the credit bureaus assume you are desperate for credit or can't qualify for the credit you need. Any future creditors may also take this information and assume that you are a high risk borrower, which will reduce your chances of getting the credit you need. In fact, according to <a href="http://myfico.7eer.net/c/27771/93942/2185">myFICO</a>, people with six hard inquiries or more on their credit are up to eight times as likely to file for bankruptcy, compared to people with no inquiries &mdash; meaning that more inquiries usually means greater risk.</p> <h2>Exceptions to the Rule</h2> <p>There are certain instances that are gray areas, which may result in a soft or hard inquiry depending on the situation (such as when you rent a car or sign up for new cable or Internet service). If you aren't sure about whether your actions will result in a soft or hard inquiry, you can simply ask the financial institution you are requesting financing from.</p> <p>Another exception is when you are rate shopping. Generally, your FICO score will only record one single inquiry within a 14&ndash;45 day period if you are shopping for the best mortgage, auto loan, or student loan rates. By doing all of your shopping for the same type of loan within a two-week span, you can reduce the effect on your credit.</p> <h2>Disputing an Unauthorized Inquiry</h2> <p>If a hard inquiry occurred without your permission, you may be able to dispute it. This can be done by calling or writing the creditor and asking them to remove the unauthorized hard inquiry from your credit report. You can also dispute them directly with the credit bureau. Otherwise, if you've authorized the hard inquiry, it can take up to two years to disappear from your credit report.</p> <h2>How Inquiries Will Affect Your Future</h2> <p>As is the case with anything that negatively affects your credit score, inquiries can affect your ability to get good loan rates. More hard inquiries means a lower credit score, which means fewer credit options or a higher interest rate. This will ultimately mean you will pay more over the life of the loan.</p> <h2>How Will Your Credit Recover?</h2> <p>The good news about a hard inquiry is that if you aren't doing them often, they aren't going to have a big effect on your credit. For instance, factors like your payment history, credit history, and credit utilization rate are weighted much more heavily. Continue monitoring your credit every month to ensure that there are no unauthorized hard inquiries or other issues so that you can continue to maintain the highest score possible. (See also: <a href="http://www.wisebread.com/10-surprising-ways-to-negatively-affect-your-credit-score?ref=seealso">10 Surprising Ways to Negatively Affect Your Credit Score</a>)</p> <p>On the other hand, if you already have bad credit, then an additional hard inquiry can have an even greater impact on your score. Try keeping your hard inquiries to only one or two a year, if possible.</p> <p><em>Do you have unusual experiences with inquiries on your account? Please share your thoughts in the comments!</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/andrea-cannon">Andrea Cannon</a> of <a href="http://www.wisebread.com/how-credit-inquiries-affect-your-credit-score">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/13-things-you-dont-know-about-your-credit-report-but-should">13 Things You Don&#039;t Know About Your Credit Report — But Should</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/4-credit-report-mistakes-that-could-be-costing-you-big">4 Credit Report Mistakes That Could Be Costing You Big</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-ways-life-is-amazing-with-an-800-credit-score">5 Ways Life Is Amazing With an 800 Credit Score</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/11-ways-to-prepare-for-your-best-black-friday">11 Ways to Prepare for Your Best Black Friday</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/heres-why-you-shouldnt-freak-out-if-you-miss-a-payment-due-date">Here&#039;s Why You Shouldn&#039;t Freak Out If You Miss a Payment Due Date</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance credit credit report fico scores hard inquiries soft inquiries Mon, 07 Mar 2016 10:30:25 +0000 Andrea Cannon 1668044 at http://www.wisebread.com Here's How Your Credit Score Affects Your Job Search http://www.wisebread.com/heres-how-your-credit-score-affects-your-job-search <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/heres-how-your-credit-score-affects-your-job-search" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/000083852417.jpg" alt="" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>If your FICO credit score is weak, you probably already know that this low score might keep you from qualifying for a mortgage loan, auto financing, or a new credit card. But can a low credit score keep you from landing your dream job?</p> <p>The answer is a bit complicated.</p> <p>Many people believe that employers check the three-digit credit scores of job applicants. But in reality, employers are forbidden from pulling your credit scores. (Yes, <em>scores</em>. You actually have three FICO credit scores, one from each of the three national credit bureaus &mdash; TransUnion, Experian, and Equifax.) What they <em>can</em> study is what is known as an employment screening report.</p> <h2>The Employment Credit Report</h2> <p>An employment screening is a version of the three credit reports that TransUnion, Experian, and Equifax maintain on you.</p> <p>Experian's employment credit report, for instance, includes public record information such as bankruptcies, foreclosures, and liens. It also includes a credit history that shows any late payments that you might have made in the last seven years.</p> <p>But one thing employment credit reports <em>don't</em> include is your three-digit FICO credit score.</p> <p>You can thank the federal Fair Credit Reporting Act for this. This act limits how your credit information can be used. For example, thanks to the act, employers can't even run an employment screening &mdash; with limited exceptions &mdash; without you first providing written consent. If you refuse to provide this consent, prospective employers are forbidden to order any employment credit reports on you, though your refusal might make your potential new bosses think twice about hiring you.</p> <p>If companies don't hire you because of information in your report, they must provide you with a copy of it. You can then review the report for possibly incorrect information. This gives you the chance to correct any mistakes that could cause potential employers to think less of your history with credit. (See also: <a href="http://www.wisebread.com/whats-a-split-credit-report-and-how-much-is-it-hurting-your-score">What's a Split Credit Report - And How Much Is It Hurting Your Score</a>)</p> <h2>When Employment Credit Reports Can Hurt</h2> <p>Not all employers check the credit of all potential hires. In most cases, employers will only check the credit of potential employees who will be working in a financial capacity or role.</p> <p>For instance, if you are applying for a job as a chief financial officer, accountant, or bookkeeper, your employer might want to make sure that you&rsquo;ve managed your own personal finances properly. The good news is you can take steps to improve your credit history, making your employment credit report more palatable to potential employers. The bad news is that improving your report takes time and discipline.</p> <p>First, those negative marks on your employment credit report will take a long time to fall off. A Chapter 7 bankruptcy filing, for instance, will stay on your report for 10 years, as will a foreclosure. A late credit card payment will remain on your report for seven years.</p> <p>But these financial missteps look less damaging as the years pass. Employers might not place as much weight on a bankruptcy filing that is eight years old, as long as your employment credit report doesn&rsquo;t show any other financial mistakes after that filing.</p> <p>So vow to pay all of your bills on time from now on. You can&rsquo;t make those negative marks disappear prematurely. But you can make sure that your report remains clean from this day forward.</p> <p>And while you're rebuilding your credit reports, take solace in the fact that the use of credit checks for employment is increasingly coming under fire. The Society for Human Resource Management in 2015 reported that 11 states limited employers' use of credit information in hiring decisions. The society also said that 17 additional states were considering legislation that would limit how employers can use credit information.</p> <p>For instance, in Colorado, employers can't use credit information in hiring decisions unless the information is related to the job. In Delaware, most public employers can't check applicants' credit, while in Illinois employers are not allowed to rely on credit information when making hiring, firing, or compensation decisions, with limited exceptions.</p> <p><em>Has your credit negatively impacted a job search?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/dan-rafter">Dan Rafter</a> of <a href="http://www.wisebread.com/heres-how-your-credit-score-affects-your-job-search">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-3"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-apps-that-monitor-your-credit-for-you">7 Apps That Monitor Your Credit for You</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/heres-why-you-shouldnt-freak-out-if-you-miss-a-payment-due-date">Here&#039;s Why You Shouldn&#039;t Freak Out If You Miss a Payment Due Date</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/9-money-moves-to-make-the-moment-your-credit-cards-are-paid-off">9 Money Moves to Make the Moment Your Credit Cards Are Paid Off</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/13-things-you-dont-know-about-your-credit-report-but-should">13 Things You Don&#039;t Know About Your Credit Report — But Should</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-7-debt-payoffs-that-boost-your-credit-score-the-most">The 7 Debt Payoffs That Boost Your Credit Score the Most</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance Job Hunting credit report credit score employers employment screening fico Thu, 04 Feb 2016 14:00:03 +0000 Dan Rafter 1649368 at http://www.wisebread.com Here's Why You Shouldn't Freak Out If You Miss a Payment Due Date http://www.wisebread.com/heres-why-you-shouldnt-freak-out-if-you-miss-a-payment-due-date <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/heres-why-you-shouldnt-freak-out-if-you-miss-a-payment-due-date" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_financially_stressed_000027261501.jpg" alt="Woman trying to stay calm after missing payment due date" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>The due date for your mortgage loan payment slipped past without you sending a check to your lender. Or maybe you didn't have enough money in your checking account to send an on-time payment to your credit card provider.</p> <p>Don't panic. Your financial misstep might not hurt your credit score just yet.</p> <p>Missed payments are a sure way to send your three-digit credit score plummeting by as many as 100 points. This financial mistake will remain on your credit report for seven years.</p> <p>But late payments aren't immediately reported to the three national credit bureaus of Experian, Equifax, and TransUnion. Often, lenders and credit providers won't report missed payments until they are at least 30 days late. This means that even if you miss your initial due date, you can still avoid a hit to your credit score by paying before 30 days pass. But first consider these variables.</p> <h2>Late Isn't Always &quot;Officially&quot; Late</h2> <p>Whitney Fite, president of Angel Oak Home Loans in Atlanta, said that most mortgage loans today come with a 15-day grace period. Your mortgage might be due on the first of the month, but lenders won't assess a late fee unless you fail to pay by the 15th of the month. This late fee will vary by the size of your loan, but could be about $100.</p> <p>Credit card companies will also charge <a href="http://www.wisebread.com/zooey-deschanel-never-pays-late-fees-and-5-other-smart-money-lessons-from-celebrities">late fees</a> if you miss your payment. Those fees vary, but what might hurt more is when your card provider increases your interest rate to the penalty rate. Under rules spelled out in the Credit CARD Act of 2009, your card provider can impose a penalty interest rate if you become more than 60 days late on your payment. These penalty rates are a true punishment, often running as high as 29%.</p> <p>But as long as you pay your mortgage, auto loan, or credit card payment within 30 days of its due date, most lenders won't report a missed payment to the credit bureaus. This means that your credit score itself will not be harmed.</p> <p>Fite warns that you need to be careful when paying after the official due date on auto loans, mortgages, or credit card payments. If you wait too long to send in your check, you might be tempting fate, and you might find yourself facing a late fee or credit hit after all.</p> <p>&quot;It can be a dangerous game to squeeze out a few extra days with the grace period,&quot; Fite said. &quot;Any delay by the mail carrier could result in the lender receiving the payment after the 15th and late fees being assessed.&quot;</p> <h2>Actually Late Can Hurt, However</h2> <p>If you can, be sure to send in that payment before the 30-day grace period ends. A single reported missed payment can lower your score by 100 points or more, especially if you had a relatively unblemished credit history before your missed payment.</p> <p>You don't want a low credit score. Lenders today rely on these three-digit scores to determine how much interest you'll pay on loans and credit cards. If your score is too low, you won't even qualify for loans or credit.</p> <p>Lenders consider a FICO credit score of 740 or higher to be a strong one. If your FICO score is under 640, you might struggle to qualify for loans or credit cards, and when you do qualify, you can expect to pay high interest rates on the money you borrow.</p> <p>Some missed payments are more damaging to your score than others.</p> <p>&quot;Recent late payments on mortgages are more damaging than late payments on other consumer loans,&quot; Fite said.</p> <h2>Unwanted Calls</h2> <p>You might not have to be 30 days late to begin receiving unwanted collection calls, too. Fite said that some lenders will begin making collection calls shortly after the first of the month. He said that almost all mortgage lenders will begin calling about missed payments on the 10th or 12th of the month.</p> <p>So if you don't want to hear from collection agencies? Make those payments on or before your due date. And it goes without saying that paying your bills on time &mdash; every time &mdash; is always the best policy.</p> <p><em>How do you stay on top of your bills &mdash; and on time?</em></p> <h2 style="text-align: center;">Like this article? Pin it!</h2> <div align="center"><a data-pin-do="buttonPin" data-pin-count="above" data-pin-tall="true" data-pin-save="true" href="https://www.pinterest.com/pin/create/button/?url=http%3A%2F%2Fwww.wisebread.com%2Fheres-why-you-shouldnt-freak-out-if-you-miss-a-payment-due-date&amp;media=http%3A%2F%2Fwww.wisebread.com%2Ffiles%2Ffruganomics%2Fu5180%2FHeres%2520Why%2520You%2520Shouldnt%2520Freak%2520Out%2520If%2520You%2520Miss%2520a%2520Payment%2520Due%2520Date.jpg&amp;description=Heres%20Why%20You%20Shouldnt%20Freak%20Out%20If%20You%20Miss%20a%20Payment%20Due%20Date"></a></p> <script async defer src="//assets.pinterest.com/js/pinit.js"></script></div> <p style="text-align: center;"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/u5180/Heres%20Why%20You%20Shouldnt%20Freak%20Out%20If%20You%20Miss%20a%20Payment%20Due%20Date.jpg" alt="Here's Why You Shouldn't Freak Out If You Miss a Payment Due Date" width="250" height="374" /></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/dan-rafter">Dan Rafter</a> of <a href="http://www.wisebread.com/heres-why-you-shouldnt-freak-out-if-you-miss-a-payment-due-date">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-5"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-credit-repair-mistakes-that-will-cost-you">8 Credit Repair Mistakes That Will Cost You</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-things-your-credit-report-does-not-include">7 Things Your Credit Report Does NOT Include</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-fix-your-finances-after-missing-a-payment">How to Fix Your Finances After Missing a Payment</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-financial-mistakes-that-wont-hurt-your-credit-score">5 Financial Mistakes That Won&#039;t Hurt Your Credit Score</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-late-payments-affect-your-credit">How Late Payments Affect Your Credit</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance bills collections credit history credit report credit score grace periods late payments Mon, 05 Oct 2015 13:00:39 +0000 Dan Rafter 1576207 at http://www.wisebread.com Here's Why Credit Scores and Reports Are Not the Same http://www.wisebread.com/heres-why-credit-scores-and-reports-are-not-the-same <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/heres-why-credit-scores-and-reports-are-not-the-same" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_thinking_questions_000038564992.jpg" alt="Woman learning how credit reports and credit scores are not the same" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Do you know the difference between your credit score and credit report? A surprisingly high number of consumers don't. They use the terms &quot;credit score&quot; and &quot;credit report&quot; interchangeably, not knowing that there's a big difference between the two.</p> <p>&quot;You can look at a credit report as your report card in school,&quot; said Jason van den Brand, chief executive officer of San Francisco-based Lenda, an online mortgage-refinance platform. &quot;You have all this information on it, sort of like the grades you get from all your different teachers. Your credit score is more like your combined grade-point average from all that information.&quot;</p> <p>Your credit report &mdash; you actually have three important ones &mdash; lists key financial information such as your open credit card accounts, how much you owe on your auto loan, and whether you've made any late payments or suffered any foreclosures. Your credit score, meanwhile, is the three-digit number that lenders use to determine how likely you are to pay back your debts on time.</p> <p>Here's a look at the differences between credit reports and credit scores.</p> <h2>Understanding Your Credit Report</h2> <p>Three national credit bureaus each maintain their own reports on your financial activity: Equifax, Experian, and TransUnion. You can order one copy of each of your three reports every year for free. Do this at <a href="https://www.annualcreditreport.com/">AnnualCreditReport.com</a>. Do not order these reports from other sites that might try to charge you.</p> <p>Once you get your reports, it's important to know how to read them. Each of your reports will start with the most basic of your personal information: your name, birthdate, address, past addresses, Social Security number, and employment information. Don't be surprised, though, if not all of your past jobs are listed. Not all employers report information on their employees to the credit bureaus.</p> <h3>Public Records</h3> <p>Ideally, the public records section of your credit report will be empty. This section lists the financial missteps such as foreclosures, bankruptcies, and court judgments that can cause your credit score to plummet.</p> <p>If a foreclosure or bankruptcy is listed here, you'll also see information on when a creditor filed the judgment against you. TransUnion will also list a date on which each of your negative judgments will disappear from your report. These dates, of course, vary. Foreclosures remain on your credit report for seven years. Chapter 7 bankruptcy filings stay on them for 10 years, while Chapter 13 bankruptcy filings also fall off your report after seven years.</p> <h3>Accounts</h3> <p>Your credit reports have two sections devoted to your credit accounts. The bad one is labeled &quot;Adverse Accounts.&quot; This section lists credit accounts &mdash; such as open credit cards &mdash; on which you have either missed a payment or been late. These financial blunders will stay on your credit report for seven years. This section will also list how much you owe on these accounts.</p> <p>There is also the &quot;Accounts in Good Standing&quot; section. This part of your report lists open credit accounts that you have paid on time for a specific period, usually the past 53 months. Again, this part of the report will also list how much you owe on these accounts.</p> <h3>Credit History</h3> <p>The last major part of your credit report is devoted to &quot;Credit History Requests.&quot; If a mortgage lender requested your credit reports &mdash; to make sure that you haven't paid your bills late &mdash; it will be listed here. You might see, too, that a potential landlord requested your credit reports. Many will do this before leasing their apartment units to renters.</p> <p>What's most interesting about this part of your report is that every creditor that requests your reports is required to list a reason why. You'll see these reasons listed here, too.</p> <h2>Understanding Your Credit Score</h2> <p>Credit scores generally get more press than do credit reports. That's because lenders use these three-digit numbers when deciding who gets loans and at what interest rates.</p> <p>The most important of your credit scores is the FICO score. Other companies offer credit scores &mdash; the VantageScore is a popular example &mdash; but none of them have the same impact on your ability to qualify for a loan.</p> <p>FICO credit scores run from a low of 300 to a high of 850. The higher your score, the better. Lenders generally consider FICO scores of 740 or higher to be excellent ones. If your score is lower than 640, though, you might struggle to qualify for a conventional mortgage loan or other loans or forms of credit.</p> <p>Your FICO credit score is only made up of the information contained in your credit reports. Not all bill payments, for instance, show up on your credit reports. You might pay your monthly utility and cell phone bills on time, but they don't show up on your credit reports and, therefore, don't have any positive impact on your FICO score.</p> <p>According to FICO, your FICO score is made up of five parts. The most important, consisting of 35% of your score, is your payment history. If you make your credit card, auto loan, mortgage loan, and other payments on time, this part of your score will be strong.</p> <p>An additional 30% of your score is made up of the amount you owe on credit card accounts and revolving loans. The length of your credit history makes up 15% of your score. In general, longer credit histories will provide a boost to your credit score. (See also: <a href="http://www.wisebread.com/how-to-use-credit-cards-to-improve-your-credit-score?ref=seealso2">How to Use Credit Cards to Raise Your Credit Score</a>)</p> <p>An additional 10% of your score is determined by the type of credit you use. FICO will look at your mix of credit cards, mortgage loans, and installment loans when determining whether your credit mix is a healthy one.</p> <p>New credit influences the final 10% of your score. FICO says that consumers who open several new credit accounts in a short period of time represent a greater risk for lenders. Because of this, opening five new credit card accounts in two months could cause your credit score to drop.</p> <p>Both your credit reports and score are key to managing and understanding your financial health. Keep tabs on both to stay in top financial health.</p> <p><em>Do you track both your credit report and your credit score?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/dan-rafter">Dan Rafter</a> of <a href="http://www.wisebread.com/heres-why-credit-scores-and-reports-are-not-the-same">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-4"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/why-the-age-of-your-credit-history-matters">Why the Age of Your Credit History Matters</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/why-you-shouldnt-panic-if-your-credit-score-drops">Why You Shouldn&#039;t Panic If Your Credit Score Drops</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/heres-why-you-shouldnt-freak-out-if-you-miss-a-payment-due-date">Here&#039;s Why You Shouldn&#039;t Freak Out If You Miss a Payment Due Date</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-reasons-building-credit-in-college-helps-you-win-at-life">5 Reasons Building Credit in College Helps You Win at Life</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/debunking-8-common-credit-score-myths">Debunking 8 Common Credit Score Myths</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance credit bureaus credit history credit report credit score FICO score loans Tue, 22 Sep 2015 13:00:30 +0000 Dan Rafter 1567348 at http://www.wisebread.com 7 Ways to Increase Your Credit Score Quickly http://www.wisebread.com/7-ways-to-increase-your-credit-score-quickly <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/7-ways-to-increase-your-credit-score-quickly" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_using_credit_card_000060969640.jpg" alt="Woman finding ways to increase her credit score quickly" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>Your credit score will determine whether you will get approved for credit cards, auto loans, mortgages, or other loans, as well as impact the interest rate you'll pay. If you aren't happy with where your credit score is today, take heart: There are some simple ways to improve it quickly. Once your credit score improves, you'll be able to enjoy <a href="http://www.wisebread.com/5-ways-life-is-amazing-with-an-800-credit-score?ref=internal">perks like lower interest and insurance rates</a>.</p> <p>Note that while these tips will help you raise your credit score quickly, be patient and remember that it can still take 30&ndash;60 days to see any noticeable improvement.</p> <h2>Credit Utilization Ratio</h2> <p>Your credit utilization ratio makes up 30% of your credit score. It's the number that shows how much debt you have compared to your total available credit. The more unused credit you have available, the lower your ratio. For example, if the credit limit on all your cards total $10,000, but you owe $8,000, your credit utilization ratio is 80%. You're using 80% of your credit. That's pretty high &mdash; a ratio of 30% or less is ideal. There are three main ways to lower your credit utilization ratio.</p> <h3>1. Pay Down Your Debt</h3> <p>Using the above scenario, if you can pay down your debt from $8,000 to $5,000, then your ratio goes down to 50%. Once you lower your debt, your score will see a significant boost quickly.</p> <h3>2. Ask for a Credit Limit Increase</h3> <p>If you aren't able to come up with some cash to pay down your debt quickly, try to get your credit card issuer to raise your limit. If instead of having $10,000 in available credit, you have $15,000, your ratio would go down to 53% with a $8,000 debt. Keep in mind, however, that they'll usually only grant this if you've had a good record with them over the last year. If you've missed payments, you may not be able to get the increase.</p> <h3>3. Sign Up for a New Credit Card</h3> <p>If you've got a lot of credit card debt, getting another credit card may not be the wisest thing to do. But if you need to raise your credit score quickly, this may be your only option. If you can, try to get a card with a 0% intro <a href="http://www.wisebread.com/when-to-do-a-balance-transfer-to-pay-off-credit-card-debt?ref=internal">balance transfer option</a>, which will allow you to transfer your existing debt over and at least get a break from paying interest each month. (See also: <a href="http://www.wisebread.com/the-best-0-balance-transfer-credit-cards?ref=seealso">Credits Cards With the Best 0% Balance Transfer Offer</a>)</p> <p>If you can't get approved for credit cards because of your low score, get a <a href="http://www.wisebread.com/a-secured-credit-card-can-repair-your-credit-score-heres-how-to-pick-the-best?ref=internal">secured credit card</a>, which even those with bad credit can get approved for. (See also: <a href="http://www.wisebread.com/the-5-best-secured-credit-cards?ref=seealso">Best 5 Secured Credit Cards</a>)</p> <h2>Credit History</h2> <p>The length of your credit history makes up 15% of your score. If your score is low because you are new to credit, then you will just have to be patient. But you can build up your credit by opening up accounts now and keeping them in good standing in the future.</p> <h3>4. Keep Cards Open</h3> <p>You should not close any existing accounts, as each one continues to contribute to your credit history. In fact, many people hold the mistaken belief that closing credit card accounts will help their credit score, when it will likely have the opposite effect. The longer you've had your accounts, the more it adds your score. Even if you're no longer using your old credit cards, you can cut up the cards or lock them away, but don't cancel them.</p> <h3>5. Become an Authorized User</h3> <p>If you're having trouble getting approved for new accounts, see if you can become an authorized user on someone else's card. But make sure you sign on with someone who is a responsible user. Your score can tank if that person misses payments or has too much debt on that card, too.</p> <h2>Types of Credit</h2> <p>The types of credit in use also makes up 10% of your credit score. These formulas favor those who have several types of loans including home loans, auto loans, student loans, credit cards, and store charge cards.</p> <h3>6. Mix up Your Forms of Credit</h3> <p>While you shouldn't borrow money for a home or car just to try to improve your score, it's worth keeping in mind that even opening a store charge card and using it for a few small purchases may help to improve your credit score slightly.</p> <p>You can also consider opening a specialized card like a branded gas card (that only works for gas station payments). This will help you resist the urge to spend on other things and you'll rack up rewards in no time, such as free gas. Pay the balance off immediately after every use and your credit score will reflect your good credit history, payment history, and increased available credit.</p> <h2>Payment History</h2> <p>Your payment history makes up the biggest percentage of your score &mdash; 35%. There is no getting around the importance of paying your bills on time.</p> <h3>7. Set up Alerts and Auto-Pay</h3> <p>Sometimes payments are missed simply because you forgot or misplaced the bill. These small mistakes add up on your credit score. If you have trouble remembering to pay your bills, then set up automatic payments or set up reminder alerts on your calendar. No excuses!</p> <h2>Credit Monitoring</h2> <p>To maintain a good score, you should be diligent about monitoring your credit, as well. Check your credit report every year at <a href="http://annualcreditreport.com">AnnualCreditReport.com</a> to ensure there are no errors. If you notice a discrepancy, act on it quickly. Your credit score may be unjustifiably low and you may simply need to make a call to correct any issues. In fact, studies have shown that up to 80% of consumer credit reports have an error, which may be costing you up to 50 credit points. Take advantage of services like <a target="_blank" rel="nofollow" href="http://www.tkqlhce.com/click-2822544-12336153-1455123184000?sid=cannon-1500837">CreditSesame.com</a><img border="0" alt="" src="http://track.flexlinks.com/i.ashx?foid=1029882.163454&amp;fot=9999&amp;foc=1&amp;foc2=585847" /> to monitor your credit score for free throughout the year. (See also: <a href="http://www.wisebread.com/the-5-best-credit-cards-that-offer-free-credit-scores?ref=seealso">Credit Cards That Offer Free Credit Scores</a>)</p> <p><em>These are our recommendations for increasing your credit score quickly. Do you have any suggestions to add? Please share your thoughts in the comments!</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/andrea-cannon">Andrea Cannon</a> of <a href="http://www.wisebread.com/7-ways-to-increase-your-credit-score-quickly">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-5"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/6-unexpected-benefits-of-secured-credit-cards">5 Unexpected Benefits of Secured Credit Cards</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-use-credit-cards-to-improve-your-credit-score">How to Use Credit Cards to Improve Your Credit Score</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-easy-ways-to-raise-your-credit-score-this-year">7 Easy Ways to Raise Your Credit Score This Year</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/5-reasons-building-credit-in-college-helps-you-win-at-life">5 Reasons Building Credit in College Helps You Win at Life</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/heres-why-you-shouldnt-freak-out-if-you-miss-a-payment-due-date">Here&#039;s Why You Shouldn&#039;t Freak Out If You Miss a Payment Due Date</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Insurance bad credit building credit credit history credit report credit score rebuild credit Tue, 28 Jul 2015 13:00:16 +0000 Andrea Cannon 1500837 at http://www.wisebread.com 5 Unexpected Benefits of Secured Credit Cards http://www.wisebread.com/6-unexpected-benefits-of-secured-credit-cards <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/6-unexpected-benefits-of-secured-credit-cards" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/woman_secured_credit_card_000008799161.jpg" alt="Woman discovering benefits of secured credit cards" title="" class="imagecache imagecache-250w" width="250" height="140" /></a> </div> </div> </div> <p>&quot;Nobody knows you when you're down and out,&quot; goes a famous blues song.</p> <p>And when your credit score is bad &mdash; really bad &mdash; you'll definitely be singing the blues whenever you're trying to find financing options. (See also: <a href="http://www.wisebread.com/how-to-get-a-credit-card-when-you-have-bad-credit?ref=seealso">How to Get a Credit Card When You Have Bad Credit</a>)</p> <p>While you may see <a href="http://www.wisebread.com/the-5-best-secured-credit-cards">secured credit cards</a> as a financing option of last resort, you may be surprised by their unexpected benefits. Here are six of them. (See also: <a href="http://www.wisebread.com/what-are-secured-credit-cards?ref=seealso">What Are Secured Credit Cards?</a>)</p> <h2>1. No Credit Check Needed</h2> <p>This is at the top of any list of unexpected benefits of a secured credit card.</p> <p>Secured credit cards are good options for those that have bad credit and are looking to avoid an additional hard inquiry on their credit histories and a potential denial. To open a secured credit card you make an initial deposit, which becomes your card's credit limit. That initial deposit can range from a couple hundred dollars up to about $5,000.</p> <p>Your initial deposit is insured by FDIC and is refundable, after applicable fees, if you decide to close your account.</p> <h2>2. Credit History for Credit Bureaus</h2> <p>Young folks starting out on their own, college students away from home, people recovering from a major life event (such as a divorce or major illness), and recent immigrants may also benefit from a secured credit card, because it helps them begin or <a href="http://www.wisebread.com/a-secured-credit-card-can-repair-your-credit-score-heres-how-to-pick-the-best">reboot their credit histories</a>.</p> <p>When you have no recent pay stubs or tax returns available, some lenders may <a href="http://www.wisebread.com/11-reasons-your-credit-card-application-was-denied-and-what-you-can-do-about-it">deny your credit application</a> because you have no proof of income. Most secured credit card companies report your activity to the three credit bureaus (Equifax, Experian, and TransUnion), so that you can start building up (or rebuilding) your credit score.</p> <p>Before signing up for a secured credit card, double check whether or not the lender reports to the credit bureaus.</p> <h2>3. Eligible for Higher Limits</h2> <p>Through responsible management of your secured credit card, you can score a higher spending limit. By turning in your payments on time and paying your balance in full every month, you improve your chances of getting a higher limit sooner. (See also: <a href="http://www.wisebread.com/how-to-get-the-most-out-of-your-secured-credit-card?ref=seealso">How to Get the Most Out of Your Secured Credit Card</a>)</p> <p>Also, you can contact your lender to make an additional deposit and increase your credit limit. Over time, your lender may raise your limit without requiring any additional deposits.</p> <h2>4. Grace Period</h2> <p>When choosing a secured credit card, it's key that you choose one with a grace period. A grace period is the window of time, often between the end of your billing cycle and the due date for that cycle, in which you pay no interest so long as your new balance in paid in full.</p> <p>While most credit cards offer a grace period, some secured credit cards don't. Without a grace period, you'll owe interest on every purchase. This would make improving your credit history tougher than it should be.</p> <h2>5. Accepted Internationally</h2> <p>Most secured credit cards are accepted as a form of payment when traveling abroad. Given the several <a href="http://www.wisebread.com/why-this-thing-in-your-wallet-is-almost-useless-today">disadvantages of travelers checks</a>, some international travelers may be happy to know that they can rely on their secured credit cards as a payment option.</p> <p>It's a good idea to read the terms of your secured credit card in order to be aware of applicable charges when using it outside of the U.S. However, there are some <a href="http://www.wisebread.com/5-best-secured-cards-with-low-or-no-foreign-transaction-fees">secured credit cards&nbsp;that have no foreign transaction fees</a> and no annual fee. (See also: <a href="http://www.wisebread.com/5-best-secured-cards-with-no-annual-fee?ref=seealso">Secured Credit Cards with No Annual Fee</a>)</p> <p>These six unexpected benefits from secured credit cards may be a welcome surprise to those trying to rebuild their credit histories. Stay focused and remain positive. By choosing the right secured credit card, you're taking the first step towards improving your financial situation. Ready to apply? See Wise Bread's <a href="http://www.wisebread.com/the-5-best-secured-credit-cards">favorite secured credit cards</a>.</p> <p><em>What steps have you taken to improve your credit history?</em></p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/damian-davila">Damian Davila</a> of <a href="http://www.wisebread.com/6-unexpected-benefits-of-secured-credit-cards">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-8"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/7-ways-to-increase-your-credit-score-quickly">7 Ways to Increase Your Credit Score Quickly</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-use-credit-cards-to-improve-your-credit-score">How to Use Credit Cards to Improve Your Credit Score</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/first-choice-bank-primor-secured-visa-classic-card-review">primor® Secured Visa® Classic Card Review</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/first-choice-bank-primor-secured-visa-gold-card-review">primor® Secured Visa® Gold Card Review</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/10-surprising-ways-to-negatively-affect-your-credit-score">10 Surprising Ways to Negatively Affect Your Credit Score</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Credit Cards bad credit building credit credit history credit report financing rebuild credit Wed, 29 Apr 2015 11:00:28 +0000 Damian Davila 1397772 at http://www.wisebread.com