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15 Things to STOP doing that are still making you broke! (Part 2)
Most of us have high hopes for a better financial situation this year. For some, that may mean saving more; for others, landing a better-paying job; and homeownership is still the American Dream for most families.
But before we can tackle this financial Bucket List and move forward, it’s important that we identify the money mistakes that we’re making that are continuously setting us back. We’ve identified 15 things that are common among the average American consumer, causing them to always be short on cash!
So, if you want this year to be your best yet for your finances and finally turn around your money mistakes, stop doing these 15 things!
In part one of this blog we covered the first seven things to stop doing if you don’t want to be broke, and here are the next eight:
- Not improving your credit score
Your credit score dictates so much about your financial picture, from credit card interest rates to mortgage payments, student loans to auto financing. But it also influences your insurance premiums, utility bills, and can even prevent you from getting a new job!
In fact, it’s estimated that for every 20 points you improve your credit score above sub-prime, you’ll save an average of $10,000 in interest and payments over the course of your life as a consumer!
The first step to improving your finances is always to take account of your present situation, so contact us for a free credit report and consultation!
- Not educating yourself about finances
Should you lease a car or buy it? What’s the best home loan for you? Should you be investing your money first or paying off your existing debt? From saving for retirement to healthcare options, choosing the right credit card to filing your taxes correctly, we can all stand to learn a lot about money.
However, too many people neglect to educate themselves when it comes to financial matters. Even worse, they often make critical financial decisions based on rumors, advice from their “expert” neighbor, or water cooler talk from coworkers. In fact, the average person spends much more time planning their vacation every year than they do planning for retirement!
Instead, empower yourself and make sure you have the best information to build a strong financial future by reading articles, credible blogs, books, and watching personal finance videos. You’ll be amazed what you learn in a very short time!
- Renting instead of buying a home
Home ownership is still the American Dream, and for good reason. In fact, there are a wide range of benefits to owning your own home instead of renting, from social, community involvement, family and, of course, financial advantages.
When you have a fixed rate mortgage, your monthly payment will never go up, but you’ll actually being paying it down to $0 over the years, owning your home free and clear. But when you rent, the monthly price can and will go up periodically, and you’re amassing no equity, no appreciation when the value goes up, and don’t even get tax advantages.
Studies show that the average homeowner has a 3.5x higher net worth than the average renter, as well as more savings, more funds for retirement, and pay less in total taxes. Their children are also more likely to do better in school, more likely to graduate from college and enjoy a much more stable and happier home life.
These days, with mortgage loans that are geared towards first-time buyers that require low down payments, there’s really no reason NOT to buy!
- Not planning for the future
Do you enjoy going to work every day, working long hours, coming home exhausted, and still only bringing home enough to live on until the next paycheck?
Well, get used to it, because many of us will be working way past traditional retirement age, or even well into their senior years. There’s no denying that Americans aren’t putting enough away to retirement comfortable any 65 (or anywhere close!). In fact, 40% of the workforce have nothing saved for retirement, and 60% aren’t on track.
But here’s the good news – you still have time to save, and the time-value of money dictates that the earlier you start investing, the faster your money will grow. So make sure you deduct the maximum retirement savings form your check, definitely take advantage of any employer matching, and focus on savings and acquiring assets that produce cash flow – not racking up debt and liabilities. You’ll thank me once you can retire on schedule!
- Straight up wasting money
New polls show that we have learned our lesson from the past recession. In fact, 55% of households are still spending more than they take in every month (the difference made up in debt), and our personal savings rates are at a rock-bottom 2.2% annually.
Of course, many of our costs – from rent to health care to food – have increased sharply over the last few years, so it always feels hard to get ahead. But we’re still spending – or wasting – money on a ridiculous list of things that show that we’re living well above our means.
Sure, the average person has a closet full of new clothes they hardly wear, but we’re even talking about things more substantial. For instance, it’s estimated that Americans spend $443 billion every year in wasted energy bills, with most people overpaying by a whole one-third!
And we’re all eating out at restaurants and on the go WAY too much, which is costing us.
The average American household now spends $6,759 on food every year but $2,787 of that total is for meals in restaurants or outside of the home. We also spend an average of $1,200 on fast food every year – or $117 billion!
We also spend $65 billion on soft drinks and $11 billion on bottled water every year, we dump countless billions gambling, and this one will blow you away: the average cigarette smoker puffs away 14% of their total income on cigs every year, which adds up to about $80 billion, or 1/7 of our total discretionary income budget!
Stop wasting your money on things you don’t need – and won’t even miss!
- Paying too much for your car loan (not your car)
Of course, we all need transportation to get to and from work, school, and home. And transportation costs actually remain reasonable, with low gas prices and car buying easier than ever. In fact, it’s not the cost of cars that’s eating up our budget, but the high price of the financing we’re using to purchase them.
In fact, the average monthly payment for a new car is now almost $500, as the typical car shopper is financing $28,524 at 16-28% interest rates over terms of 73 to 84 months! Ouch!
So before you go shopping for a car, talk to Nationwide Credit Clearing about improving your credit score so you’ll qualify for a better auto loan. Then, you’ll be free to purchase that fantastic new car – on your terms!
- Paying late
It’s hard enough to manage our finances and get ahead without choosing to spend more, but that’s exactly what we do when we pay our bills late.
In fact, about 1 in 4 U.S. adults don’t pay their bills on time, and only half of 18 to 34-year-olds do so. When we pay late, whether it’s a credit card, a phone bill, or our rent or mortgage, we get hit with unnecessary late fees.
The typical American pays $250 each year in late fees just to their bank! So always pay on time if you don’t want to be broke!
- Getting whacked with unnecessary fees and charges
Likewise, overdraft fees, ATM fees, and other extraneous fees from financial institutions are really putting a dent in our wallets. Banks charge their own consumers an average of $412 in overdraft fees every year, adding up to about $33 billion annually!
We also pay about $329 per year in ATM fees, and they’re often tacking on charges just for doing business with them on many checking and savings accounts! Make sure to read the fine print and pay attention to how much you’re wasting in fees!
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Improve your finances this year starting with a free credit report and consultation from Nationwide Credit Clearing!
25 Facts about the U.S. auto industry (including how a good credit score will save you a lot of money when buying!)
Since 1908 when Henry Ford rolled out the first Model T from his Detroit production line, America has been one of the world leaders in manufacturing and selling cars.
Here are 25 facts about the auto industry – including car loans and how a good credit score can save you a lot of money when buying!
1. In 2017, we bought a lot of cars! In fact, 6.2 million new cars were sold, as well as 11.1 million SUVs and light trucks, adding up to approximately 17.3 automobile transactions.
2. Considering that there are approximately 323 million people in the United States, that means more than 1 out of every 18.6 people bought a brand new car…just this year!
3. While those numbers are impressive, they’re slightly off of the high point of auto sales in 2016, when nearly 17.5 million light passenger vehicles sold, as well as 17.4 million in 2015.
4. Worldwide, 78.6 new cars sold in 2017!
5. In 2017, the motor vehicle industry (including manufacturers, dealerships, used part dealers, service centers, etc.), employed almost one million U.S. workers (approximately 940,000).
6. In fact, the auto industry is responsible for about 3 to 3.5% of our entire U.S. gross domestic product.
7. We also manufacture a lot of cars in the United States these days. In fact, nearly 12 million light passenger vehicles were built in the good ‘ole U.S. of A last year.
8. At least 2.1 million of those automobiles were exported and sold abroad, spanning almost every country in the world for a total value of $57 billion.
9. Additionally, the secondary automobile parts export market is worth an impressive $80 billion, and we also exported $5.5 billion in used cars.
10. While that’s a whole lot of new cars, the U.S. is still second to China for automobile markets, both in terms of sales and production.
11. Of course, a lot of car sales mean a lot of car sales dealerships. In fact, there are currently 18,250 new vehicle dealerships in the United States.
12. According to government estimates, there are about 222 million licensed drivers in the United States, which means that about 69% of our country has a driver’s license.
13. We also know that there are approximately 260 million passenger cars, trucks, and SUVs on the roads, which adds up to 1.24 automobiles for every person with a driver’s license in the U.S.!
14. In fact, there are 260,350,940 registered vehicles in the United States, which is an all-time high.
15. That also accounts for 20 million more automobiles than 2007, and in 1990 there were only 193 million registered autos in the U.S.
16. But the car market is still heating up around the world, with new car dealers expected to bring in 916 billion by 2020, with used car sales following with 106.6 billion in sales.
17. An interesting data point is the Scrappage Rate, which measures the number of cars sent to junkyards and put out of service every year. Over the last couple years, the Scrappage
18. Rate fell to only 11.5 million annually, a record low when compared to the number of cars on our highways and roads.
19. If we look at the monthly budget of the average America, their rent or mortgage payment tops the list, but transportation costs (including car payments) comes in second.
In fact, when added together, housing and transportation account for about 50% of the typical American’s income.
20. The average American’s monthly spending chart looks like this (based on a $51,442 per capita): income:
33% Housing, $16,887
17% Transportation, $8,998
13% Food, $6,599
11% Insurance, $5,591
7% Health Care, $3,556
5% Entertainment, $2,605
3% Clothing, $1,736
11% Total other expenses, $5,470
21. While we may be buying new cars at record rates, we’re still using financing to purchase the vast majority of them. In fact, in 2017, auto lending hit a new record with more than $1.1 trillion in car loans owed by consumers!
22. In fact, the average person with a car loan now has $18,694 in auto debt, and the average new car came with a sticker price of about $35,000 in 2017.
23. But last year, the average person who financed their car purchase borrowed $30,032 in loans (the first time that average exceeded $30,000). The average monthly payment for a new car loan is now $503, the first time that number has risen over $500.
The average loan term is now 67 months (5.58 years) for new automobiles and 62 months (5.16 years) months for used autos, both record highs.
24. However, car loans are being extended to people with marginal or even poor credit scores like never before. These days, almost 20% of all auto loans go to people with credit scores of 620 or less – called “subprime” (a score of 680 is typically considered good.)
According to Experian, 19.3% of auto loans now go to consumers with subprime or deep subprime credit scores. That means less than two-thirds of auto loan borrowers (61.3%) have prime or super-prime credit.
25. There’s no denying that it’s a great feeling to buy a new car, and reliable transportation is a must for most of us. However, subprime auto loans tend to come with sky-high interest rates and cost us way too much in total interest. For example, a person financing a $23,000 car might spend $9,615 just in interest with a 66-month loan at 14.99 percent!
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So, in order to get a great car loan, have a better monthly payment, save a lot in total interest, AND get that beautiful new car you love (and deserve), talk to Nation Wide Credit Clearing first about improving your credit score!
15 Things to stop doing that are making your broke!
Many of us set resolutions every new year, and chief among them is the goal to improve our finances. For some, that may mean saving more; for others, landing a better-paying job; and home ownership is still the American Dream for most families.
But before we can tackle this financial Bucket List and move forward, it’s important that we identity the money mistakes that we’re making that are continuously setting us back. We’ve identified 18 things that are common among the average American consumer, causing them to always be short on money and even hurting their families.
So, if you want 2018 to be the best year yet for your finances, stop doing these 15 things that are making you broke!
- Maxing out credit cards
We’re certainly a nation that loves debt, as we now have more than 1 trillion in credit cards and other revolving debt, an all-time high. Add in mortgages, student loans, car loans and medical debt, etc., and U.S. consumers personally owe more than $12.9 trillion – the GDP of about half the countries in the world!
In fact, the average adult with debt in the U.S. has 8 credit accounts, $16,000 worth of credit card debt alone, and is paying about $430 a month just in minimum payments.
While there’s nothing at all wrong with having credit cards and using them responsibly (you should keep some revolving debt), the problem comes when we max them out – with no plan to pay them off.
Paying only minimum payments means that the average $10,000 balance at 15% interest will take 15 years and about $22,000 to pay off completely.
Maxing out cards also impacts your credit score, since about 30% of your FICO is calculated by the amount of debt you hold compared to your total available credit (called credit utilization.)
So stop maxing out those cards and make more than just the minimum payment this year!
- Not saving
We understand that money is tight and there’s usually more month than paycheck; not the other way around. But one of the principal ways you can ensure that money isn’t always this tight in the future is to start saving. And there’s no better way to put away funds for a rainy day than automatically saving out of every paycheck (or tax refund).
In fact, the majority of Americans couldn’t even come up with $600 today without borrowing or selling something, and sudden financial setbacks like a job loss, medical problem, broken car or other unexpected expense can send about 40% of families into dire financial circumstances.
The best way to combat that – and make sure that you’re always prepared and won’t make even worse short-term financial decisions – is to save a certain percentage of your paycheck automatically, before you even see that money. To resist the temptation to spend it, keep a savings account without an ATM card so it’s not easy to access. You’ll be amazed how it adds up!
- Using payday loans, check cashing, and rip-off credit accounts
Remember how we just mentioned financial emergencies? When the roof leaks, someone gets sick, or the job starts laying people off, those cash crunches often result in people making panicked, short-term financial decisions just to get by. Frequently, those result in cash advances on credit cards, payday loans, using check cashing establishments, applying for a bunch of new credit cards at once, or looking for other personal loans.
The terms and interest rates on these loans can range from incredibly high and expensive all the way to usurious and illegal, and usually put people in a much worse financial situation than when they started.
- Making impulse purchases
Have you ever noticed that retail, department, and grocery stores line the checkout aisles with certain items? They do that on purpose, of course, because they understand that the majority of consumers will make impulse purchases; buying things they don’t need and didn’t plan on purchasing.
Just how much can you save by skipping the magazines, sodas, electronic knick-knacks, and other impulse purchases every month? Furthermore, do you even know how much you’re spending on coffee, lunches, and meals out? It all adds up.
Try this: For one month, carry around a little notepad (or just use your smart phone – there are great apps that help you track every dollar you spend), and write it down every time you spend a dollar. At the end of each week, add it all up according to categories. You’ll probably be shocked how much you’re spending on things you don’t need or necessarily even want – and that money could be going to savings, paying down your credit cards, or other good use.
- Not checking your credit periodically
Did you know that only 1 in 4 people check their credit report annually, and 60% of Americans don’t even know what their credit score is now? Checking your credit report regularly is so important for a host of reasons:
- 25% of credit reports contain errors, inaccurate or duplicate information.
- ID theft and credit fraud now affects nearly 10% of the population every year, and the recent Equifax Hack saw the personal data of about 167 million Americans compromised.
- These days, your credit score is so more important than just getting a mortgage or applying for a new credit card. Getting an apartment, the insurance rates you pay, your utility and cell phone accounts, and even getting a new job may depend on a clean credit report and a good score.
- Not looking into refinancing your mortgage
If you do own your home already, congratulations! While it may be the best investment you’ll ever make, there’s no denying that you’ll be paying it off for a long time (usually 30 years) and for a huge sum of interest – probably more than the original home price! So every smart homeowner should inquire with their mortgage broker if a refinance is available and something that would help them save.
It’s free to talk to your favorite loan officer and get an idea about your options, and lower-interest mortgages or refinancing into a product like a 15-year loan may save you tens (or even hundreds) of thousands of dollars over the years. You may even be able to save money on your monthly payment AND pay the home off faster, but the worst that can happen is that they tell you that you don’t need to make a change.
By the way, the better your credit score, the lower your interest rates and payments will typically be!
- Not reading the fine print
That 0% credit card offer sure looks great, but what will the rate be after that introductory period? Is that great low mortgage payment fixed, or will it go up as other interest rates rise? What are the fees and charges associated with that new student loan or business loan?
Too often, we’re offered new credit that looks like a no-brainer, but comes with some important stipulations that will make it way more expensive in the future.
Nothing is free in this world (except great credit advice from Nationwide Credit Clearing!), so make sure to read the fine print and know exactly what you’re getting into before you sign on the dotted line. Any loan, investment, or other financial vehicle is sure to come with fees, charges, and interest rate details that are crucial to understand. Read all you can but it’s also a good idea to ask questions – and get the answers in writing!
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Look for part two of this blog soon, where we’ll cover the next eight things to stop doing if you don’t want to be broke!
Can your credit score go down because of your social media activity?
Like it or not, social media is a big part of our lives. In fact, 81% of Americans have at least one social media profile, and we now use 2,675,700 GB of Internet data per minute! Twitter, Instagram, Snapchat, LinkedIn, and YouTube are popular social media platforms, but Facebook is still the biggest, with more than 2 billion users worldwide.
People post just about every detail of their lives these days, share droves of links and content from others, and reach far past their circle of friends that they know in real life.
But it might not just be other social media users who are watching your Facebook and social media accounts and judging you. In fact, banks, lenders, and credit bureaus may soon be paying attention to your social media usage – denying you for a loan or lowering your score based on what they see.
Already, the scope that our personal data from social media is collected, shared, and sold is startling. Pretty soon, you might be denied for a loan on a credit card, a car, or even a mortgage because of who you’re friends with on Facebook. For instance, the average credit score of your social media friends and network could be a factor that influences your credit worthiness, too – a scary proposition. It’s not as far-fetched as you may think.
Back in the “good old days,” lending in the U.S. usually took place on a more personal level, with consumers walking into the local branch of their hometown bank. They sat down with a banker whom they already knew a long time and made their case for approving the loan during a conversation, with the bank granting or denying their request based on their character and reputation.
We’ve come a long way since then, and now, lending decisions are made uniformly with mountains of data collected and interpreted by nameless, faceless credit agencies with advanced algorithms – the credit bureaus.
But even with all of our advanced technology, some things never change, as credit bureaus and lenders may well be turning back the clock and trying to gauge your character, lifestyle, and reputation before approving you for a loan. Not only can they look at what you post, but check-ins, what content you like and share, and even the groups or brand pages you belong to.
The U.S. Patent office recently granted an updated patent on technology that combs social media for evidence of a person’s closest network of friends. It then relays that information to potential creditors, who can make lending decisions based on the friends’ perceived financial stability.
The patent, which Facebook first acquired from Friendster and inventor Christopher Lunt in 2010, actually has a much broader scope of intended use than just data mining for lenders. In fact, the main purpose of the patent is to protect technology that formulates and tracks how social media users are connected in a social network, protecting them from spam
But another use in the patent’s official application (called use cases in patent-speak) definitely outlines that same technology functioning as a way for lenders to aggregate credit scores and financial data from your Facebook friends when you apply for a loan.
All of this can eventually factor into their complex algorithms that gauge you as a solid candidate for a new loan – or a big credit risk.
However, there are several reasons why credit risk monitoring via social media may not be practical, ethical, or even legal.
First off, we have the Equal Credit Opportunity Act, a federal law that states that credit must be granted to all creditworthy applicants without paying credence to their race, religion, gender, marital status, age and other personal characteristics. That’s the exact reason you aren’t asked your race, religion, etc. on any loan application or credit form. But that information is often readily available on many Facebook and social media profiles, which opens the door for discriminatory practices.
Next, credit decisions are all supposed to be transparent and disputable. That means you’re supposed to know why your score goes up and down, and there can’t be mysterious or secret factors that play into your score that are disclosed on your credit report. Likewise, you have the right and ability to dispute incorrect items on your credit such as duplicate items, bad information, or even accounts opened and used by ID thieves.
But when credit bureaus track and use your social media usage to help determine your credit worthiness, they’re using factors that are neither transparent or disputable.
Furthermore, pundits point out that social media accounts can be easily manipulated. For instance, if a social media user knows that creditors are watching, they might purposely post certain things, like certain brands, check-in at certain places, etc. that would reflect positively upon them in the eyes of creditors. Basically, they could also set up fake or duplicate social media accounts, or you have the risk of someone else setting up a social media profile in another real person’s name.
Lenders will always look for “alternative data” to improve the accuracy of their credit lending decisions, some things. Cell phone usage, paying rent on time, and even bank account activity could possibly impact your credit score shortly.
But the potential for creditors to track your social media usage raises some serious concerns.
Millennials aren’t making the grade when it comes to credit.
When it comes to Millennials, the financial picture is less than glowing – including their credit scores. With 83.1 million young adults in our country between 18 and 34 years old (born between 1981 and 1997), Millennials are the largest demographic in U.S. history.
They’re also impossible to ignore since by 2025, they’ll make up about one-quarter of our total population and three-quarters of our workforce (about 53.5 million workers).
Still, research shows that Millennials are seriously stumbling when it comes to their credit scores, debt, and financial acumen.
Here are 25 facts about Millenials and debt, loans, and credit scores:
1. According to NerdWallet.com, the average Millennial credit score is only 628, the lowest of any age group in the country and significantly lower than the 700 average American FICO score.
2. Millennials may be young, but they’re already saddled with debt at an alarming rate, with an average of $23,332 in debt each. For reference, Gen X’ers have an average of $30,039 debt.
3. According to TransUnion, 43% of all Millennials have bad credit, considered subprime borrowers. The next highest group is Generation X with 33% bad credit, and only 20% of Baby Boomers.
4. Furthermore, only 6% of millennials have credit scores in the super prime (781 to 850) category, compared to 34% of Baby Boomers that achieve those credit score heights.
5. In fact, 28% of all Millennials have a credit score of 579 or lower. That’s one in four young people with a dismal credit score!
6. Other research shows that approximately 67% of all young adults under 30 have credit scores of 681 or less – two-thirds that don’t have good scores.
7. However, low credit scores may not be 100% their fault when we consider that the length of credit history makes up 15% of any person’s credit score. Of course, Millennials are far more likely to have shorter credit histories (and fewer accounts). So not only do they miss out on any score boost from seasoned credit lines, but missed payments or negative item wreak havoc on their score.
8. The most disturbing part is that Millennials seem to understand credit scores and credit reporting far less than any other generation, In fact, 44% of Millennials don’t even know what their credit score is right now, and only one in five have checked their credit report in the last year!
9. When they are granted new credit accounts, Millenials are also using it to rack up consumer debt at a higher rate than any generation. In fact, the average Millennial has $59,154 available credit but uses $47,089 of it – an astronomically high 79% credit utilization ratio.
10. While these numbers are averages, looking deeper, we see a different story. Since about one-third of Millennials have never even applied for a credit card (and have no credit card debt), we see a portion of this age group that has amassed huge debt loads.
11. Of course, it makes sense that Millennials are also applying for credit cards at a higher rate than any other demographic, exceeding the U.S. average.
12. As we documented, they’re spending more on their credit cards and credit lines once they’re approved. In fact, Millennials now have an average debt (not including mortgages) that equals 77% of their income, compared to the national average of 49%!
13. The burden of student loan debt weighs most heavily on Millennials these days, with student debt skyrocketing 56% in the last decade to nearly 1.2 trillion dollars.
14. 38% of Millennials carry student loan debt, and 42% of Millennial households have student debt.
15. The average graduate leaves school with nearly $30,000 in student loans. Among all Millennials, the average student loan balance of $17,200 with $351 in monthly payments.
16. But their debt doesn’t just come from investment in education, with 35% of this age group also carrying an auto loan. On average, Millennials with car loans owe $11,000 owed and pay an exorbitant $503 in monthly payments!
17. Furthermore, only 20% have a home loan, which can be considered “good debt.”
18. When they do apply for credit cards or new credit (like store retail accounts), almost half (48%) of Millennials do so as an impulse decision – on the spot at a store, sporting event, mailing offer, or when an offer pops up online, etc.
19. A high debt load puts a strain on their monthly budget, often preventing Millennials from buying their first home.
20. Where do Millennials live?50% of Millennials rent on their own,Only 26% own their home, condominium, etc.,21% of Millennials still live with their parents,and 3% live in military or student housing.
21. Additionally, between 2006 and 2013, the number of young adults living with their parents jumped 15%, which means an additional 10 million working-age people still living at home.
22. Millennials are now renting for an average of six years before they buy their first home.
23. In a Fannie Mae survey, Millennial renters gave their top reasons why they weren’t buying a home. 57% of respondents said that they weren’t buying for financial reasons, including:
- Insufficient credit score or history
- Affording the down payment or closing costs
- Insufficient income for monthly payments
- Too much existing debt
(That’s right – a credit score that’s too low is the #1 obstacle to home ownership according to Millennials, followed by saving for a down payment).
24. According to financial polls, 62% of Millennials have less than $1,000 saved – and 21% have no savings at all!
25. In fact, a recent survey by SurveyMonkey found that almost half of all adults age 18 to 34 spent more on coffee than they contribute to investing for retirement! It’s true – about 44% of females and 35% of male Millennials spend more at Starbucks than in their 401K or retirement planning.
Still, the news isn’t all negative when it comes to Millennial home ownership, as one in three (33%) homebuyers in 2017 are Millennials, and 68% of first-time buyers this year are in that age group.
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Are you a Millennial and you’d like to improve your credit score? In college or just graduated and already facing debt? Or maybe your son or daughter needs some credit score help? Message us for a free consultation!
How Can A Bad Credit Score Affect You?
When you make a purchase using your credit card, you are typically not thinking about the affect it will have on your future. You probably aren’t thinking of the purchase as a test of your personal integrity or reliability. You are more than likely thinking about that new television you are purchasing or how your new watch will look on your wrist. In contrast, your creditors don’t care how your new watch will look or how much joy your new television will bring you. They want to recover the money they lent you, with interest. Lenders do not like borrowers with elevated credit risk (the risk that you will not repay the money you owe). To determine your credit risk, lenders will rely on your credit score.
Your credit score is based on the information that is provided in your credit report. It will include data on past loans, foreclosures, credit utilization, bankruptcies, credit applications, and more. Credit scores follow a scale ranging from 300 (most risky) to 850 (least risky). Lenders will often times segment the score ranges into classifications such as A, B, and C.
Your credit score will affect more than just your personal finances. Credit scores influence many aspects of your personal and public life, even including situations that do not involve borrowing money. The following are situations that can be affected by a bad credit score:
- Getting approved for a loan will be difficult
- Higher rates and restrictive terms on loans that you are approved for
- Trouble renting an apartment
- Trouble getting a job
- Difficulty getting a mobile phone contract
- Higher insurance premiums
- Potential strain on your personal relationships with friends and family
Here at Nationwide Credit Clearing we will professionally assess your credit situation by procuring basic information that will allow us to obtain a copy of your current credit report. We will do this by a “soft inquiry” so that it will not affect your credit score. Our team of professionals will determine the best method of credit clearing to utilize on your case. Learn more about how we can help you!
Source: Money Crashers
“Home of the Free Credit Report & Consultation”
2336 N. Damen
First Floor
Chicago, IL 60647
Phone: 773-862-7700
Toll Free: 877-334-3296
Fax: 773-862-7703
E-Mail: support@mynationwidecredit.com
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Little Know Causes for Bad Credit
Most consumers are responsible – the kind who pay their bills every month and never borrow more than they can reasonably pay back. However, even the most responsible person who feels that he or she is excellent with personal finance can find him- or herself with bad credit. The reasons may be surprising, and not all of us are aware of just how much can have long-term effects on our credit reports. Here are just a few little known causes for bad credit.
Persistent Late Payments
While most consumers know how missed bill payments can negatively impact their credit reports, many don’t know that persistently paying their bills late can also have a detrimental affect. Paying a day or two late once in a while won’t be fatal, but even if you miss your payment by just one day each month, it can play a huge role in watching your credit rating plummet.
Too Many Credit Applications
Having too many credit cards or too many lines of credit can ruin your credit. Even if you pay each off each month, on time, it still makes you look like a risk to other lenders. With the higher debt you could potentially have, the worse your credit can be. You may feel responsible enough not to max out each card or each line of credit, but lenders don’t always think that way. Limiting the total credit balance available to you will go a long way in making you look more attractive to other financial institutions.
Maxing Out Your Credit Limit
Be sure not to limit yourself too much when it comes to credit cards, however. If you find that you are constantly maxing out your credit card, you will look like a credit risk, causing your credit rating to fall. Even if this limit is paid in full each month, it still indicates to other banks that you could potentially miss a payment, making you a lending risk.
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Mortgage Brokers: What do you do when a client gets denied due to bad credit?
PARTNER WITH THE BEST IN CREDIT REPAIR
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Nationwide Credit Clearing has been in business since 1985 helping thousands of individuals that have “credit challenges” by legally removing the negative, derogatory and incorrect information appearing on their credit reports from the three credit bureaus – Trans Union, Experian and Equifax. By challenging these items, we have found that individuals and couples can lead easier lives in today’s economy.
Nationwide Credit Clearing
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Chicago, IL 60647
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Lower credit score?
How is it that you can actually get a lower credit score when you feel like your spending habits have gotten better? Learn why your credit scores might have dropped since you last checked them by using this informative infographic below:
In summary, here are 5 solid reasons your credit score may have recently dropped:
1. 30 plus days late on payments
2. Credit Card balances exceed 30% total
3. Closing an old account
4. Too many Credit Card Inquiries
5. Identity Theft may have racked up debt without you knowing.
If this seems overwhelming to you, it’s important to call a credit repair company such as Nationwide Credit Clearing
Our Family of Experts is Ready To Get You Back To Healthy Credit
LET US HELP YOU SOLVE YOUR CREDIT TROUBLE (773) 862-7700
Nationwide Credit Clearing, the home of the Free Credit report and Consultation.
2336 N. Damen
First Floor
Chicago, IL 60647
Phone: 773-862-7700
Toll Free: 877-334-3296
Fax: 773-862-7703
E-Mail: support@mynationwidecredit.com
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Debt Solutions: Ways to Begin Eliminating Credit Card Debt
A lot of people end up with staggering credit card debt. Even though it seems overwhelming, trimming your financial allowance through small changes in your lifestyle might help.
Debt Solutions: Day-To-Day Savings
Take a seat and consider the amount of money you would spend throughout the week on coffee, lunches and takeout dinners. Somebody who spends $ 5 each day in the coffeehouse is looking at Hundred Dollar expenditure throughout the course of the month. Invest that first month’s savings on a at home coffee maker and travel mug so you’re able to take the coffee from your home. The same goes for your morning breakfast. You will begin to see extra cash in your pocketbook right away.
For lunch time, take the brown bag with you. The $10 or more you spend every day on one salad or perhaps a sandwich leads to over $200 monthly. Instead, buy salad fixings or lunch meat at the supermarket. For anybody who typically runs late each and every morning, pack your lunch the evening before to prevent adding precious minutes towards your morning routine.
This may be the toughest adjustment for families on the go, but it’s time to cut back on takeout dinners. These quickie meals are budget busters. A few cartons of Chinese food or a couple of pizzas can easily run you $30 or more a pop. Instead, keep frozen prepared meals on hand for those nights when cooking isn’t an option. Double your recipes and freeze batches of soup, chili and casseroles on weekends when you have time to cook. Even frozen prepared foods from the grocery store will save you considerable amounts of money. Avoiding expensive takeout even twice a week can save nearly $250 a month.
Debt Solutions: Monthly Payments
The initial place to search for simple savings is in your mobile phone, cable and Internet fees. Chances are you’re spending money on features you are not using. For people with every cable channel but aren’t big on watching TV, contact your cable company to find out what packages are available that still offer what you need. Your cell phone bill could possibly be another budget drain which can be trimmed through careful research of packages available.
You could search for a bundle package that provides you significantly lower rates on your Internet, mobile phones and cable by utilizing the same company for all those. Comparison-shop between providers and do not hesitate to let them understand what you have been proposed by their competitors. This tactic is known to sweeten many deals.
Debt Solutions: Big-Ticket Items
Make the most use out of your expensive items before replacing them. Keep appliances, cars and electronics until they are no longer useful instead of purchasing every new item that comes on the market. You could be in need of that new tablet, but stick to the existing laptop for a bit — it is not costing you anything at all. Invest a few bucks in repairs to maintain your big-ticket belongings in good condition, and wait to buy new items before you look for a deal you simply can’t pass by.
Now that you know more about how to eliminate credit card debt, get your FREE credit report & consultation from the #1 Chicago Credit Repair Company, Nationwide Credit Clearing.
Nationwide Credit Clearing
2336 N. Damen
First Floor
Chicago, IL 60647
Phone: 773-862-7700
Toll Free: 877-334-3296
Fax: 773-862-7703
E-Mail: support@mynationwidecredit.com
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