Credit Cards For Less Than Perfect Credit

Rewards credit card unveiled by Egg

July 15, 2009 – 8:06 pm

Online bank Egg has announced the launch of a new credit card which allows customers to receive rewards for spending money on it.

The Egg Money Mastercard has no balance transfer fees and an interest rate of 8.9 per cent, while credit card holders can receive one per cent cash back on all purchases up to 200 per year.

Owning the credit card also lets customers take advantage of 25 per cent discounts at online stores like lastminute.com and any purchases which the consumer finds cheaper elsewhere in the 30 days after buying it can get the difference refunded by Egg.

Bert Pijls, chief executive officer of Egg, said: “This card not only rewards and protects customers but with tools such as the Spend Tracker and Egg Money Manager it also helps customers manage their finances better.”

Customers with a credit card from telecommunications company BT will now be able to take advantage of unlimited discounts off broadband and telephone bills for using the plastic after it changed its policy.

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Should You Refinance if You Have Bad Credit?

July 15, 2009 – 6:44 pm

Refinance is possible for people with bad credit. The option is readily available to any body with good or bad credit history. The question here is, Should you refinance? It is a sensible question. While on the one hand, refinancing is possible and will certainly help you lower your liabilities, on the other hand it can also be a detriment to the prevailing condition.

Analyzing your Credit Situation

You need ask yourself several questions before proceeding to refinance your liabilities. As a first step you should read through your credit account. If the credit report is not appealing, you should first work for improving the credit situation. With no effort your refinance application will be rejected for sure. Hence to avoid a bad foot print on your credit report, you should improve and ensure your refinance application will succeed in fetching you a loan. Refinancing as an option can help or hinder the bad credit situation depending on the precaution you take.

Calculating Cost

Jot down every possible cost to be incurred for a refinance option. The best feature of refinance is that you get lower interest rates and shorter repayment periods. You should clearly note every charge which is made on the option, starting with insurance cost, carrying cost, closing cost, service fees, and a never ending list. Hence, remember cost is not just the interest cost; it is the total of all the charges made till the date the loan is repaid. Do not forget to make note of the additional taxes charged in the transaction.

Cost Benefit Analysis in Bad Credit Situation

You should do cost benefit analysis of the cost incurred and the resulting benefit you get. Say, if it is a bad credit home mortgage refinance, you benefit if you stay for a long time. Otherwise, it will not be a wise decision to refinance your home mortgage.

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Credit Score and Mortgages – Ways To Get A Higher Score

July 15, 2009 – 4:31 am

Pay off debts to improve credit scores.

Credit Score Basics

Your credit score is something you can see on your credit report. You will typically have three different credit scores on your credit report. This is one score from each of the three different credit bureaus.

These credit bureaus collect information from all of your different creditors and assign you a credit score.

Mortgage lenders usually use your middle (”mid-score”) of the three credit score as part of your mortgage application. Usually your three credit scores are usually quite similar, but sometimes they can be very different.

Collections

Your credit report will list bad debts and collections.

The more you have of these, and the more you owe on these, the lower your credit score is likely to be.

When you review a copy of your credit report you may see creditor names that you do not recognize who claim that you owe them money.

These unfamiliar names are usually the names of collections companies you have purchased your bad debt from your original creditors. For example, an unpaid cell phone bill may be sold off to a collection agency.

Your credit report will usually contain the account number, phone number, and address of each of your creditors.

You can contact them to resolve your disputes.

If you have paid off all your debt, and your credit score seems to be at a stand still, you might want to make small purchases each month with your credit card and pay them off immediately. Often times the credit bureaus like to see at least some kind of activity.

Either you will need to pay off bad old debts or convince the creditor that these are in error.

Either way you will need to resolve these to help improve your credit. You will usually receive a written confirmation from the creditor when an issue is resolves. You can submit this documentation to credit bureaus to make sure your credit report is updated and your credit score improved.

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Subprime Bad Credit Lenders

July 12, 2009 – 5:36 pm

Bad credit means that your credit score is in a poor condition. Credit score refers to the score assigned to each individual to determine if they are worthy of credit or not. If they have taken only one or two loans, repay them promptly and make no default, points get added to the score. However, if they default on loan, have too many loans and so on, and then points get reduced from their credit score.

A person with a high score is worthy of lending money to, while a person with poor score is a risk to lend money to. When you default on repayment of loan, you are in bad credit and banks owned by government and financial institutions owned by the private will not be forthcoming to further lend any money to you. The only option available to you is to borrow money from the subprime bad credit lenders.

Who are Subprime Bad Credit Lenders?

These lenders give money as borrowing to people who suffer from bad credit. Since the other lenders will not even accept your loan application let alone approve it, you have no choice but to go to a subprime bad credit lender. These lenders will give you loans to build a house or for other expenses. While you may fear about how adverse these loans might be, you have little reason to do so. These lenders have terms and conditions of repayment that are not too harsh. So, you do not have to worry much.

What about the interest rates?

The rate of interest charged by the subprime lenders vastly differs from person to person. So, you have to shop around and get quotes from various lenders before choosing one. Since you are in bad credit, it is risky to lend money to you. Therefore the charges will naturally be higher than the rate charged on ordinary loans.

What precautions should be taken to deal with Subprime Bad Credit Lenders?

A bad credit position signals that you are already in a financial crunch. So, think carefully whether you need to take one more loan to make your position even worse. Read the terms and conditions of your agreement carefully to see if any extra and unknown charges are hidden inside the agreement. Or else, this will cost you and your family dearly.

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Bad Credit Mortgage Loans: Understanding Appraisal Fee, FICO Credit Scoring System and APR

July 12, 2009 – 5:25 am

When applying for bad credit mortgage loans, you should have an idea of FICO credit scoring system. If your credit score is in the range of 570 to 580, you need to put at least 15 percent as down payment on the property. In this scenario, you are not going to get an approval for 100 percent financing. Individuals having credit score in the range of 585 to 599 needs to put 5 percent down payment in order to avail home mortgage loan. You are going to get an approval for 100 percent financing when your credit score is in the range of 600 to 620. With a credit score of more than 620, you are going to get bad credit mortgage at low interest rates.


Interest-only bad credit mortgage loans give you an opportunity to only pay the mortgage interest. You need to pay the mortgage interest on a monthly basis. Your interest rates are going to remain the same throughout the duration of the loan. At the term completion, you can opt for refinancing. Interest-only bad credit mortgage loans can turn out to be advantageous when you are suffering from bad credit.

Appraisal Fee

In case of bad credit refinance, the new financial institution may need an appraisal before giving you approval. General speaking, home appraisals are of four kinds ranging from $100 to $300. Your financial institution will evaluate which appraisal kind is mandatory for your loan approval. If your credit score is good, you can negotiate with your financial institution on the appraisal kind. A complete appraisal will cost you around $300. It includes pictures of the interior and exterior of your house. If you are only interested in the appraisal of the exterior, you just need to spend $250. Drive-by and electronic appraisals will cost you $100.

What is APR?

APR is the Annual Percentage Rate that is being charged by the financial institutions while offering bad credit mortgage loans. You will find quite a bit of variation in the Annual Percentage Rate of various financial institutions. The APR charged on you will have an impact on your interest rates and repayment schedule. Before signing any contract with the financial institution, make sure that you ask them about the APR. With lower APR, you are going to get the best possible loan deal. Shop around in the market if you are looking for lower monthly installments.

Role of Bad Credit Mortgage Lenders

Bad credit mortgage lenders play a very vital role in bad credit mortgage loans. When your credit score is not up to the mark, traditional mortgage lenders are not going to give you a loan approval. In this scenario, only option left for you is bad credit mortgage lenders that exclusively deal with the bad credit. Bad credit mortgage lenders charges high interest rates in comparison to traditional lenders but that is pretty much expected because they are taking a huge risk on you by offering bad credit mortgage loans. As your credit score improves, you can ask your lender to reduce the interest rates.

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