My College Credit Card Debt Mistake

Guest Post by Christine Kane

I have not had a credit card in over 10 years. I have chosen this path because I learned an important lesson at a young age. I was a freshman in College learning the ins and outs like how to sleep with your eyes open during lecture. When I wasn’t mastering this art form I was enjoying living the fine life with weekend road trips, new clothes, fine dining, parties and concerts.

Like most Colleges that first week of school when doe eyed freshman arrive, there are lot of on campus things to attend. Most colleges have a meeting where students can find new clubs, organizations and programs to become a part of. Roaming these halls are bankers and credit card givers.

I was approached by a charming fellow just a few years older than me. He offered me a credit card and I declined because I had heard from my family that is what I needed to do. After I said no, he persisted with his sales pitch of the credit card. Except, I didn’t realize it was sales pitch. These words that flowed from his mouth were music to my ears. Promises of low interest rate (what’s that? I had no idea), easy to use, use it for beer, books and gas. SOLD. I signed up and signed my credit score life away.

This little piece of plastic became my study, party and shopping buddy. I didn’t really know the limit or what would happen if the limit was exceeded. I didn’t know understand that paying the minimum wasn’t good. I had no idea, because no one told me.

6 months past and before I knew it I had accumulated almost 4,000 dollars of debt. Oops. What now? I panicked and when the card stopped working and the calls started coming, I did what any 18 year old girl does, I cried. I knew had to make that dreaded phone call home to explain that their scholarly daughter had in fact made a very uneducated financial move.

After a few lectures and a few ‘pull you out of school’ threats, we all calmed down. Thank goodness I was lucky to have parents that could afford to help me out of my mistake. They took the card and paid it off. I got job and to pay them back, plus interest, of course.

My advice to parents or young college students. Educate yourself on credit cards. Parents sit down with your child and explain the basics behind it. Students avoid the smooth talking men and pretty woman with shiny cards. Don’t ruin your credit like I did. And if you are in debt, don’t be afraid to ask for help from anyone whether they are your financial adviser or parent.


Author Bio:
Christine Kane from internet service providers, she is a graduate of Communication and Journalism. She enjoys writing about a wide-variety of subjects for different blogs. She can be reached via email at: Christi.Kane00 @ gmail.com.

3 Steps to Building a Superhuman Credit Score

Guest Post by Jacelyn Thomas

With the economy still weak from the recent recession (though at least recovering), it is harder to impress credit lenders than it was ten years ago.  What would have passed for an above-average credit score in 2001 (680) is now considered on the lower side of average.  The reason for this new, higher definition of credit-worthiness is primarily that banks are still hesitant to loan money for fear of not making that money back.  They want as few liabilities as possible, so they are more stringent in their credit score requirements.

In light of the shifted credit score curve, it might be time to examine your own credit score, as well as your spending and credit usage practices, to ensure that you aren’t unfairly denied a loan for your next car, house, or business venture.  There isn’t much you can do to improve the economy, or lender’s expectations, but there are steps you can take to improve your credit score, so that you will impress even the shrewdest of banks and always get the best rates.

Step 1: Know Thyself (Or At Least Thy Credit Report)

There are a number of factors that influence your final credit score: Payment history, bankruptcy, credit card debt, length of credit history, type and number of credit cards, and hard inquiries that are made when you apply for loans and lines of credit.
At any point, it is possible that one or more of the three bureaus that track your credit usage or any involved party (banks, collection agencies, etc.) could make a mistake that might negatively affect your score. 

To avoid this, check your credit report every 12 months for errors.  You can obtain a free copy of your credit report (though your score isn’t on free reports) from AnnualCreditReport.com; if you find any errors you can dispute them to have them resolved.  But be aware: it can take up to six months to fix an error on your report, so do it early, and be patient.

Step 2: Hold Steady

Especially if you’re planning to buy a new home or car in the near future (three to six months), don’t open any new lines of credit if you can help it.  Ultimately your credit score shows lenders your risk level, and will directly affect your interest rate — and applying for loans and credit cards temporarily lowers your score, so you might not get the best rate possible if you have any recent hard inquiries into your credit report. 

Instead of opening new accounts or transferring balances, make the best use of the credit you have.  The best way to prove to banks and other lenders that you will be a reliable borrower is to have a great revolving credit history.

Step 3: Be a Payment Superhero (Or At Least Pay Your Bills On Time)

Credit history accounts for 30% of your credit score, so it is imperative that you aren’t delinquent on any accounts you have.  The fastest way to delinquency is missing payments or due dates, so make your credit card payments with superhuman punctuality, and you’ll be on your way to a superhuman score.

But not missing payments isn’t really enough.  Ideally, you should be paying your entire balance in full (or at least more than the minimum amount due) every month, and should never exceed 30% of your total available credit. 

You won’t be bulletproof or be able to leap over tall buildings in a single bound, but if you follow these steps, your credit score will leap up, and will be as close enough to bulletproof that lenders will trust you with their lives (or at least their money, which is all that really matters). 

Author Bio:
Jacelyn writes about identity theft for IdentityTheft.net. She can be reached at: jacelyn.thomas @ gmail.com.

Did Enrolling in a Credit Card Debt Repayment Program Hurt Our Credit Rating?

Our first attempt to get a loan after enrolling in the program.

The month is April 98 we have been on the credit card debt management plan now since November. I am scheduled to retire from the Navy at the end of June 98 and we still don't know where we're going.

I have sent off many resumes to the Western North Carolina area hoping to get a job in the area. Neither of us are from the area but the area is beautiful and very similar in atmosphere to Maine.

In preparation for the move from Maine to North Carolina we had to tie up some loose ends that were going to cause us grief. First on the list was a mini motorhome built on a 1 ton Toyota pick-up truck chassis. In 94 when we moved from Florida to Maine parts of the motorhome had rotted and needed to be rebuilt. The motorhome has had its day we had a good five years before our first child and used this vehicle quite a bit. Now we had three kids and could use a vehicle that was more family friendly.

We looked around and found a Ford dealership that sold used program cars. These vehicles were used by a company for a year for their sales force and were ready for sale at a set no haggle price. They had 30,000 to 40,000 miles on each vehicle and were priced below Bluebook.

The dealership had many 98 Taurus wagons that all had Cruise control, power everything and car phones. But the best feature was a third seat in the back. This allowed the kids to spread out a little on long rides.

We went to the dealership when it was closed and looked over the lot. We then checked on the internet to see what kind of track record these models have had. It turned out the first model in the late eighties and early nineties had problems with engine mounts that ruined many transmissions. But that was corrected long ago and the current models benefited from the earlier mistakes.

We did our home work, we knew which car we wanted and we decided to trade in the motorhome. Our hope was that we were not upside down on the loan for the motorhome. We also were worried because we were on the credit card debt repayment plan. Would that prevent us from getting the loan needed to purchase this car?

They test drove the motorhome and came back with $1500.00 over the payoff amount of the loan. That was good news, now we had to wait.....

We got past our first worry.

Would we get past our second worry? Would we be able to get the loan or would we suffer from voluntarily consulting and enrolling in a credit card debt counseling and repayment program?

...the dealership came back with a decent interest rate through Ford's finance group and our loan was approved.

We got past our second worry, the loan was approved.

So what is the answer to the big question above?

No! We had a good credit rating prior to enrolling in the credit card debt counseling and repayment program and we still had a good credit rating after enrolling.