Still living off credit cards? Can?t figure out how much you could or should spend? Need to save for retirement? Deborah McNaughton, a Placentia credit expert, financial coach and author of ?The Essential Credit Repair Handbook,? is here to provide her financial advice:
Q: I have been trying to get a credit card and keep getting turned down. I don?t understand it when 18-year-old kids can. I have been denied credit because I don?t have a credit rating on my credit report. Neither do 18-year-old kids who have never charged anything in their lives.
Is there a credit card company that will give me a credit card despite the fact that I don?t have a credit rating?
A: Interesting enough, no credit on a credit report is just as bad as having bad credit. You have to start somewhere. Debit cards are not reported on credit reports, so those don?t count.
A secured credit card is the best way to get a jump start with your credit history. Many local banks and credit unions offer secured credit cards. See a list of additional banks offering secured credit cards HERE.
When you open an account for a secured credit card you will make a deposit into an account. It can range from $250 ? $500. The bank will then issue you a credit card. It will be either a Visa or Mastercard that is secured by the amount of the deposit. In most cases the bank will issue you a credit limit of the amount of your deposit or a percentage of it.
A secured credit card does not look any different than an unsecured Visa or Mastercard and is used the same.
The idea is for you to use the card. Make only small purchases that you pay off in full each month. Don?t allow your balance to go over 30% of your credit limit. Each month that you make your payments, it will be reported on your credit history.
Some lenders will look for at least 2 pieces of credit on a credit report. The credit scores are derived by the mix of credit, history, length and balances to the credit limits.
Once you establish a credit history on your credit report, you should be able to apply for an unsecured credit card which doesn?t require a deposit for collateral. Give it some time. It may take 6 months to 2 years to be where you want to be. Every lender is different on qualifying.
Remember, the idea is not to have credit card debt, but to use your credit card to build your credit history for emergencies or convenience. But don?t charge more than you can pay back when the bill comes due.
Q. Does not paying a timeshare maintenance fee affect one?s credit? It is owned outright with no mortgage but never used. Can it be quit-claimed back to the association without credit consequences?
A. Maintenance fees for a timeshare are not based on whether it was financed or free and clear. It is based on the contracts that were signed at the time you purchased the timeshare.
The first thing you need to do is read all of the governing documents associated with your timeshare. When you made the initial purchase of your timeshare you were given documents that gave you all the stipulations and conditions of the purchase.
View your timeshare like you would a mortgage that was paid off. Part of the obligation you agreed to when you purchased the timeshare was to pay a ?maintenance fee?. This would be similar to a neighborhood homeowner?s association dues that a community would require.
In the case of a timeshare?s maintenance fee, if you don?t pay, it can be turned over to a collection agency. Not only would you lose your right to use the timeshare, but if it is turned over to a collection agency it will be more than likely be reported on your credit report.
If the maintenance fees are not paid, the association that you belong to with your timeshare can place a lien on the ownership interest you have and foreclose for non-payment.
Read more about the pitfalls of timeshares and how they can affect your credit HERE.
Q. You wrote in your Feb. 6 column about what parents can do after lending their children a down payment for a house that their children may now? allow to be foreclosed. Why doesn?t the father just file a quit claim to protect his credit status?
A: This question was with regards to the father and mother who helped their son and daughter-in-law purchase a home and co-signed for the mortgage. The home was upside down and the son and his wife were on the verge of divorcing. The parents wanted to know what their responsibility was if their son and his wife decided to walk away from it.
In this case, filing a quit claim deed to protect the parents? credit rating won?t work.
A quit claim deed will either add a name or delete a name on the title of a property. In this particular situation, even if a quit claim deed removed the parents? name from the title, they would still be affected by the mortgage history.
When the father and mother co-signed for the loan, they took responsibility for the repayment of the loan. Removing their name from the title does not release them from the loan commitment they signed. They still will be named in a foreclosure or any delinquencies for the loan on the property. Yes, their credit report will be damaged. There is no way around it.
Co-signing is risky. Individuals need to be aware of all the consequences on what can happen if a family member, friend or relative defaults on making payments. It?s not a good outcome!
Do you have questions about credit, dealing with debt or budgeting? Send your questions to moneymatters@ocregister.com with ?credit question? in the subject line. Please include your name and a phone number where you can be contacted. They will not be published.
Did you miss these stories on personal credit?
Did you you miss these recent stories on jobs and the economy:
You can follow any responses to this entry through the RSS 2.0 feed.
You can skip to the end and leave a response. Pinging is currently not allowed.
Article source: http://economy.ocregister.com/?p=105544
Source: http://supercreditcards.info/2012/03/18/no-credit-how-to-get-a-credit-card/
willis mcgahee ship aground off italy nfl playoff schedule 2012 nfl live saints vs 49ers vanessa marcil 49 ers
Vanquis.co.uk card info offers excellent service in providing customers the credit they deserved. Many are satisfied in using their services.
ReplyDelete