Three Little Known Facts About Credit Cards

Think you know your way around a credit card? Then these three little-known facts might just surprise you:

Why are credit cards all the same size?

No matter which bank or institution issues your credit card, they will always be exactly 3.375 x 2.125 inches wide and around 0.02 inches thick.

This size is standardised by the International Organisation for Standardisation (ISO Standard 7810).

Among many other things, the ISO regulate the size of credit cards to make sure that no matter where you are in the world, you can use yours to pay for anything, from hotel accommodation to a Big Mac to making a cash withdrawal to pay for ice-cream on the beach.

What does the stripe on the back of a credit card do?

Much like card size, the stripe on the back of a credit card is magnetic and regulated by ISO Standard 7811 and it contains various bits of information about you and the bank that issued your card.

The magnetic stripe is made up of three tracks of encrypted data which is read electronically. A reader, like those inside an ATM, can tell which bank or institution your account belongs to, what the card number is, when the card expires and what your spending limit is.

However new ‘chip and pin’ technology is being built into credit cards to make them even more secure.

The chip, which looks like a small silver microchip, should appear on the front of your card and if not, it might be time to contact your issuer or shop around for a new one to make sure you have the best credit card you can get in terms of security.

Is the long number on a credit card unique?

It is, but it’s not random or meaningless. Each number, or sequence of them in that long string reveals something about you and your credit provider.

The very first digit is known as the Major Industry Identifier (MII) and it tells a vendor which creditor issued your card. All Visa cards, for example, begin with a ‘4’ while all MasterCard’s begin with a ‘5’.

The first six numbers are known as the Issuer Identification Numbers (IIN) and they tell a vendor what country your card was issued in, by which specific bank and the credit type that it’s valid for. You can try it yourself by entering your card details at binlist.net.

Those are just three facts about credit cards that make them absolutely universal yet totally unique, but if you’re thinking about applying for a first, or additional credit card then it’s always wise to shop around.

Although cards look and work in the same ways, the terms that a credit provider can offer you vary from one bank to another so to get the best credit card, take some time to investigate the terms and conditions, interest rates, repayment expectations and any freebies on offer before signing up for credit.

3 Ways to Save Money Towards a Mortgage

With the economy recovering steadily after the debacle of 2008 and income in a majority of sectors rising nicely, it’s as good a time as any to start working on your financial goals and improve on any areas that may require your attention. Although paying off your mortgage might sound like an overtly ambitious plan, especially if you’re recently gone for a long term refinancing, it makes sense to give serious consideration to paying off your home loan since it can have a positive impact on your finances in the long run.

Mortgage

Not only can an early mortgage payoff ease off a lot of burden off your shoulders, it’ll also net you considerable interest savings over the course of time since you’ll be free from scheduled monthly payments over the next couple of decades or more. However doing this not only requires a lot of discipline and intrinsic motivation, but also some smart moves from your side. Since it might be hard to cut down on expenses for most of you, we’ll cover some innovative ways of saving money that can help you put extra money towards your mortgage:

1. Check out Cashback Cards

Thanks to increasing competition, companies today are coming up with newer and better products in order to win over customers. Since this ends up benefitting end users like us, this usually results in savings over conventional products. Take for example cashback credit cards that offer you Cash Back on your everyday spending, thus lowering your expenses indirectly and resulting in considerable savings over a period of time, allowing you to put extra money towards your mortgage payments. This is exactly the reason why cashback schemes are becoming so popular these days. If you haven’t looked into them yet, then you should do that soon!

2. Find Good Deals

Another interesting way of lowering your expenses and augmenting your savings is by looking for good deals on products that you regularly consume. Even on medium to high ticket items, this can end up saving you substantial amounts – directly or indirectly since you could either get decent discounts on most products or other lucrative deals in the form of special offers. Usually it’s best to compare the prices of the items you want to buy online since you would be able to come across sites that offer the same product for much lesser prices than the others.

3. Opt for Alternative Products

While the above two methods would work well for most of you in saving money towards a mortgage, if you can combine it with this third one, it would be even better. Since there are alternative products available that are almost equivalent in quality to those manufactured by the top brands, you could look into buying these as there is usually a premium charged by the best companies for their products, which means if you switch over to an alternative brand or product, you could save considerable amounts. While these savings might seem small to you initially, they keeping accruing over a period of time and you end up saving a decent sum month over month!

Should You Go For a Reloadable Debit Card?

Before you know it, the holiday season will be upon us, and you’ll be scrambling to purchase the latest toy or gizmo for your loved ones. If you’ve got to shop for gifts, it’s best to do it online because you’re far more likely to save money in the long run. You can take advantage of a wealth of coupon and discount codes that will offer you big savings at your favorite stores, and there are many sales and specialty items you just won’t find in person, thus limiting your ability to save on a range of items.

Some retailers also offer second hand and homemade items that are also much cheaper than alternatives, so it’s a good idea to keep an eye out this holiday season so that you’re not going into debt. The holidays can be a magical time for everyone, but it’s best that you don’t let the grab of consumerism envelop you or you might find yourself digging hard into your pockets for extra money to spend that you can’t really afford. You can have a wonderful Christmas without spending your last on exorbitant gadgets that your friends and family don’t really need.

Instead of using a credit card, it’s also a good idea to order a reloadable debit card if you don’t already have one. It’s all too easy to overspend on a credit card, and if you don’t have the money to pay it back you can easily accrue debt that will hurt your credit score. A debit card will resolve this issue while still giving you freedom to make orders online.

You can also set up your debit card to receive direct deposits from your workplace so that you don’t have to manually deposit money each week.

6 Things You Can Do to Start Fixing Your Bad Credit

While the economy seems to be stuck in a never-ending, downward spiral, it is important for people to realize that it is never too late to start fixing your credit score.  Millions of people in the Unites States have some form of debt that may be impacting their credit.  If you are one of these people, do not think that your credit is necessarily ruined.  Even if your credit may look ruined, it is not.  There are multiple ways in which a person can improve their credit.  It is vital to remember that improving your credit score is a lot like trying to lose weight in that it is a long, demanding process that requires commitment, and may take some time to see results.  By managing money responsibly and being dedicated to the cause, you will see long term improvements in your credit score.  The most important aspect of improving your credit is to remember that significant results only come with time. When contemplating ways to improve your credit score, be extremely cautious of quick help solutions or people who say they can drastically improve your credit score over a very short period of time, for this is typically the most common method to back fire.

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What you can do to start fixing your bad credit

  1. Credit Score— The first step to improving your credit is finding out what exactly your credit score is.  There are multiple resources you can explore that can provide you with your credit score, both online and in person.  Before you try to improve your credit, you should examine your credit score and make sure everything is correct.  Check for possible incorrectly listed late payments on all of your accounts.  Check to see how much debt you actually owe.  Finding out the answers to questions like these will help to guide you on your path to improving your credit score.
  2. Pay bills on time— When trying to improve your credit, you should focus extremely hard on paying your current and future bills on time.  Roughly 35% of your credit score is made up of your bill payment history. Paying your bills on time can have an unbelievable impact.
  3. Set up payment reminders and due dates— Every month, sit down with a planner or agenda and mark all of your bills on the days that they are due.  Write reminders on a calendar that you look at regularly. By doing this, you are less likely to miss or be late on a payment.  Writing down your bills also gives you a visual and better understanding of exactly where you are at financially.
  4. Stop using plastic— A major aspect of improving your credit score is taking care of past debts, whether it’s credit card debt or something like a title loan from TitleMax.  It is counterproductive to add more debt to your financial situation while you are still paying off a previous debt.  To help get rid of past debt and avoid new debt, stop using credit cards and try to only use cash. 
  5. Live inside your means— In today’s world, it is very easy to get caught up in possessions.  Who doesn’t want the new iPad or the biggest and best television?  The problem is, not everyone who wants these items can afford to purchase them with cash, leading them to debt.  Even those who can afford to purchase these luxury items with cash may be put in a tough situation when it comes to bill paying time.  To improve your credit score, you must take care of past debts while focusing on making on time payments.  By living inside your means and purchasing what you can actually afford, you will be able to handle past debts and secure your future payments.
  6. Open another bank account— It may be hard to fathom, but opening another bank account could actually improve your credit over a period of time.  To help pay off debt, open another bank account strictly for paying off debt.  Any time you receive money, be it from a paycheck, birthday, holiday or whatever, decide how much you need at that exact moment and place that into your personal checking account.  Take the rest of the money and place it into your debt account.  By doing this, you will be building up a set of cash strictly for paying off debt.  This will also keep only a certain amount of available money in your personal account at any given time, which will help you decide when you should be spending money.

With these tips, you can take the much needed steps to improve your bad credit and get back on track. 

James McKinney is a financial expert who coaches individuals on building wealth and eliminating debt.

Rebuilding Your Credit After Foreclosures

Foreclosures have a tremendous negative impact on credit scores, but that impact does not last forever. While the immediate effect of a foreclosure is a 200 to 300 point decrease in reported scores, time and a little effort put into rebuilding finances can restore credit to reasonable levels. Time passes, and so do negative credit entries.

Foreclosures only stay on credit records for seven years. However, if everything else about the borrower’s credit is in good order, it can only take a couple of years for credit to begin to rebound. The important things are to pay bills on time, have only a few credit cards with relatively low balances and always pay at least the minimum on those cards.

Five years after a foreclosure, even the Federal Housing Administration (FHA) may agree to insure a home mortgage, if the borrower has exhibited financial responsibility in the interim. Going through foreclosure is not a pleasant experience, but once the proceedings are finalized, things can begin to improve.

By paying attention to financial obligations and being particularly diligent about credit cards, borrowers can win their way back to credit-worthy status in only a few years. Of course, every situation is different. Someone with questions about rebuilding credit should consult an expert on the subject, like the experienced professionals at Lexington Law, who can offer advice on all aspect of the process.

Risks and Benefits of a Student Credit Card

As you head on to a college, you think to have your first credit card. As the lifestyle of college is different from the high school, so you need to spend a bit more than the usual days.

Acquiring a student credit card is easy now and in one sense, they come to a lot of use in your college. And at the same time, it is a great way to budget your finances and avoid unnecessary debts. We debt can be the other reason for you to acquire a credit card.

Many credit card companies are there out in the market, which provides credit card, knowing that they are going to use that with irresponsibility. It may sound beneficial to the credit card company, but actually, it is a kind of harassment for the credit card company, to handle customer who fails to forward their monthly payments.

Risks of a Student Card

People who are in the habit to opt for debt, tends to stay in debt. Some kind of annual fees are charged and penalties are assigned for the person who is in debt. This is referred as revolving debt. And the ones who are having revolving debts are valuable to the credit card company than those people who make regular payments.

As college is the wild time for the young adults, so they are meant to get rowdy with their spending habits. Many of the credit card companies do not hurt their cardholders, but what to do for then debt is a good way to generate revenue. On the other hand, the credit card companies are well aware that the cardholders will continue with the same credit company. Now if you are a student credit card holder, then you are sure to turn into long-term cardholder with that company.

Benefits of a Student Credit Card

Credit cards are not a good thing for the young adults because of their bad spending habits. However, at the same time, it is a great way to make them learn how to live their life independently. If you have a low limit student credit card, then you will be able to remove the temptation of bigger spending.

A credit card, which is having a low limit, can be used frugally, and hence the payments are easy to pay off in a regular fashion. This will help students to build a positive credit and takes care of the fact that the student enrolls in a finance course.

Now the student can speculate carefully between, what are their necessities and what are their luxuries. They should use the credit card with an aim to establish a good credit score, for their future financial purposes.

Remember: A Student Credit Card Must Be Used Wisely

Yes, this is the basic concept that you should be using when you swipe the credit cards in a shop, movie corner, restaurant or a gas station. This is the card when you should use during emergency, may be while ordering expensive textbooks, medical expenses or school utility expenses.

As students are staying far away from their home to pursue higher studies in their respective colleges, a credit card is must for their financial security. And yes do remember that the credit card is not a child’s play, so use the card with responsibility.

Author’s Bio: Rizzo Barter, author of this article is a financial blogger and an expert advisor. He shares his expert knowledge on credit cards and their usage to benefit his readers. He is working as a consultant at a bilingual call center, which delivers 24-hour flawless service to different kind of financial organizations.

 

How Bad Credit History Can Affect Your Credit Score

Your credit score or FICO score is a value available to different lenders and other financial companies to know the borrower’s repayment capability for a new loan. These estimates are given by major credit report agencies where they consider various factors in determining your credit worthiness. Factors and its percentages that are used in calculating credit score are as follows:

Payment history (35%): Contribution of payment history on FICO score is around 35%, which is the major factor that affects the credit score. Payment history is calculated using various other factors such as late payments, bankruptcies, defaults, repossessions, charge offs, foreclosures and so on. 

Amount of debts owed (30%): Amount of debts is the second largest factor that is used for calculating scores. This is determined by evaluating various types of debts owned by the borrower. In general debts can be categorised into 3 different types, they are:

  • Revolving debt
  • Instalment debt
  • Open debt

Age of credit file: (15%): The age of credit file is also an important issue in determining the value of credit. If the accounts’ date you opened is older, then the chance of getting a good credit score is also more, similarly the average page of all the accounts that are presently on your credit file is also considered into a count. The severity of negative impact also takes into count in calculating credit score.

Types of account files (10%): If the borrower has different types of credit accounts and could successfully maintain these accounts for a longer time then the chance of scoring good credit rate is high.

New credit request (10%): Whenever an applicant wish to get new credit, an application is made by that specific lender requesting your credit information. These types of inquiries will have effect on credit scores.

Therefore, from the above details, hope it is very clear to understand the impact of one’s credit history on their credit score. Having a bad history doesn’t mean that you are not eligible to be financial well-being, with some commitment towards settling your debts you can achieve complete financial stability in short-time. The following are a few tips that help in repairing your bad credit history.

  • Try to pay all your bills on time
  • If you use more than one credit card, try to stop using them and carry only one with you for emergency usage
  • Create effective budget and stick to it
  • Implement an effective debt management plan

Individuals who are with bad credit history may not eligible to acquire new credit; even though they are eligible often these loans are charged at high interest rates. To receive instant cash irrespective of credit score and payment history, get same day loans where you need to pay back your loan by your next payday. 

Is It Possible to Live Without Borrowing Money?

borrow moneyEven though, a modern society is built upon the principle of borrowing money, a logical question arises if it possible to live without debts? Plenty of crises have taught us that an enormous variety of credits and debits may influence money flow in a radical way.

If we have got everything necessary, why do we still require more money?

What do people usually borrow money for?

Basic reason why people have tendency to borrow much money is their wish to get richer.A desire of enjoying life, a wrong perception of money that with its help we will be able to get anything we want is completely false. Thus, try to teach your children that process of enjoying life does not necessarily involve money. Result of such thinking may occur to a long debt-list that is no good at all. What is the point of purchasing things that you may not even need? Still the consequences will show all the importance of every spent penny.

Is a habit of borrowing money changeable?

Spending an entire life on borrowing money is not a radiant opportunity at all. Though there are some people who do not care about a moral side of an issue. With time flowing they just lose a sense of guilt and they end up judged by society, still they do not feel anything wrong about it. Having a debt-free life is not teachable if a person does not realize a chain of credits in the contemporary world.

Have you ever thought what your life would look like if you had debts during your entire life? It will be full of thrills and threats, stresses and nerves. While a life with wholesome needs will be much more satisfying and to some extend absorbing. For example, if you lead a debt-free life, you will not have any wish to get a credit or a loan, as your firm financial position may change and turn upside-down.

Put aside from every paycheck

If you would like to make a bug purchase, try to save some money for it. If you take out a loan, you will automatically get a debt even if you still have time before a deadline. Therefore, save some money from every salary and this will be very helpful if you decide to buy some piece of furniture for your house, or a Christmas purchase.

Nevertheless, if you are aware of your inability to pay the entire sum in full, then you have a good option for borrowing money with a term of month. The so-called no fax payday loans online are absolutely hassle-free, fast and faxless, which means without any paperwork.

With that being said, think carefully before making a decision of taking out any kind of a loan or credit. Become more organized with your everyday spending. Get a new habit- not to buy things that you do not really need. Would like to learn how to budget? You are more than welcome to look up hundreds of quality advices on Internet!

Make Good Financial Plans For A Better and Merrier Christmas

Christmas is a one-time annual event that brings with it a sea of endless joy and happiness. Such an event as Christmas is marked by the exchange of gifts amongst family and friends. Further, you’d certainly want to give your children gifts that they have been awaiting all year. All of this generally incurs huge expenses, not to mention the rising costs that could bring the best out of your budget. You can’t choose to sit and watch others enjoying the elegance of Christmas. Buying gifts that are beyond your affordability could create a mountain of debt on you and make you run for debt relief options. This article intends to help you with some tips that will make sure you enjoy Christmas in its full glory as well as remain debt free while you do so. Read on further to know more:

Draw a limit on the gifts – You don’t have to buy your children costly gifts. Rather focus on buying them something that will keep them happy for a longer period of time. That’s a good way to ensure you’re not going to a debt relief company anytime soon.

Make a commitment – List the names of people that you want to present gifts with. The next thing that you need to figure is the amount of money that you can spend without breaking your budget. There is no point in considering what others are doing. Make sure the gifts that you buy are meaningful to the people you’re going to give them to. It is important that you stay committed to not let debt grow on you. So, move your focus to other expenses that you can cut down if the total gift price seems like breaking your budget. There are debt relief options, but why fall in debt in the first place?

Save money – Start saving up money separately for next Christmas as soon as you get over with the present one. Go for automatic deposits to your account on paydays. Adding bit by bit will make up a handsome amount that will help you take care of your Christmas expenses to a great extent. Saving money will also take care of your debt relief expenses in case you happened to use such services.

Ready the gifts – Buying the gifts during the year is a good idea. This will provide you kind of a debt relief during Christmas as you don’t have to spend a bagful of money at once.

Practice GREEN Christmas – It is a great idea to exchange old gifts amongst friends and relatives. This will teach you the value of things as well as save you gift money. Saving money is equivalent to getting debt relief to some extent.

Make cash payments – Paying in cash is going to help you save more money than you would have using credit or debit cards. Relying on a budget and paying in cash will give you a clear idea of your expenses and make you more careful so as not to become dependent on debt relief services.

Christmas is all about spreading love and not making arrangements that will force you to resort to the services of a debt relief company in future. There are good debt relief services for those who need them, but why fall under debt in the first place? Make sure you’re spending your money doing some charity work rather than readying yourself to receive debt relief services.

Celebrating Christmas without letting debt grow on you is the best way of celebrating the festival. Careful planning and effective decisions can save you money as well as make sure regular visits to a debt relief company are not what you end up doing at the end of the day.

3 Effective Tips to Improve Your Credit Score

Keeping a good credit score is easier said than done, but it is still important to make use of every opportunity to step up your credit score as it can come in handy for you in the future.

Especially if you are in the habit of spending too much and using your credit card more than you can afford to, your credit score will go for a toss pretty soon. So here are some simple yet effective tips that would be helpful for you to improve your credit score:

1. Lower Your Credit Card Debt

The first and foremost thing you’ve got to do is to reduce your credit card debt to manageable levels so that slowly and steadily you can start getting a grip on your finances. If you keep high balance on your credit cards near their credit limits then there’s a good chance that your credit score will start getting adversely affected.

To prevent this, start paying off your debt in small amounts until you are comfortable with the remaining debt. This will significantly help you improve your credit score over a period of time.

2. Limit Your Spending

One of the main reasons why people are unable to maintain a good credit score is that they use their credit cards too often, for buying unnecessary items that may not be of any use to them a few months or a few years down the line. The result is that they are often unable to pay off the debit due to their unchecked spending, thereby negatively affecting their credit scores in the process.

The best way to stop this is to only use your card to buy items that you need, so that you would not have too much difficulty in paying off the balance later. Also try to use only up to 50% of the credit limit on your card. If you need to purchase some more things, then you should ideally use a different card.

3. Check Your Limits

One of the reasons that you might be unaware of is that your lender might be showing lower limits than your card allows, thereby hurting or lowering your credit score. It’s always best to update this information so that it won’t hurt you later.

Also, make it a point to get a copy of your credit reports so that you know exactly what needs to be taken care of, since the credit report would include the list of accounts that might be negatively affecting your credit score.