Talking About Credit Cards For a New Year

It’s the holiday season, and the year is slowly coming to a close. Now is definitely the time to check out all things finance, even though it might not seem that way. There are many banks and lenders in the UK that will be practically giving away money, and it’s up to you to check them out. Do you need a new credit card? Believe it or not, the answer might be yes. Let’s go back into things a bit to really give you the full picture around the issue.

You see, it’s all about being able to get the best credit terms without having to spend a lot of money overall. If you’re still dealing with the same credit cards that you opened up years ago, you might qualify for lower interest rates. This means that more of your monthly payment will go to what you actually charged and not just the interest. The trouble with high interest cards is that so much of the minimum monthly payment is going to pay the credit card company itself, not necessarily for the things that you bought. Smart credit management means looking at these things as a way to get the full benefit out of them. That’s the true issue of the matter, and you need to take it seriously.

What if you’ve cleaned up your credit in the last few years? Believe it or not, new offers aren’t just going to come to your door. It’s possible, but if you’re not already being targeted on several mailing lists or you’ve chosen to opt out of that system, you really have to make sure that you’re looking at the best offers in the market. If you apply for multiple credit cards in a tight window, you should avoid making heavy damage to your credit score. Sometimes having too many credit inquiries on your reference file can be a big problem, but when done in a short window, the damage is lessened sharply.

Do you travel often? A rewards card might make sense for your needs. There are a lot of people that go only on the advertising alone, and that’s a really bad way to select credit cards for the upcoming financial year. You want to go with a card that has features that matter to your lifestyle. If you don’t do a lot of traveling, all of the miles in the world aren’t going to do you any good. However, if you can turn miles into points that can be used in other places, that’s going to be much more beneficial to your life. Continue reading

Credit Cards & Scoring

Before a Credit Card company accepts or rejects your application for a credit card they will invariably undertake a credit review to establish if you are a good or bad credit risk.  They will do this in two principle ways:  they will conduct a credit check and credit scoring review.

What is a credit check?

A credit check will be made on factual information held about you on a credit register.  The are three main credit reference agencies collecting and holding information on us. These are Equifax, Experian and Callcredit.  The information these agencies hold will allow the lender to check details including your name and address, your credit history with other lenders, as well as any County Court Judgements (CCJ’s) or defaults recorded against your name.  Together this information will form your ‘credit refererence’.  This credit reference therefore will determine your ability to secure a credit card and borrow money at attractive rates of interest.

credit reviewWhat is Credit Scoring?

Credit scoring is a method of rating your credit application by applying a value or ‘score’ to the answers that you provide when completing your credit application.  A lender will hold their scoring system confidential, but it is likely they will award scores based on things like: how long you have been resident at your current address, how long you have held your bank account, your occupation and how long you have been employed in your current job, and your annual household income.

You should, at any rate, regularly check your credit reference files yourself so you can see what the lenders or credit card companies are seeing. Another advantage is that It will also help you know if anyone is fraudulently using your name to open new credit agreements.  The main credit reference agencies are Experian and Equifax and you should check them both if only to confirm that the information they hold on you is correct.  The third agency, Callcredit, is a fairly new company. Continue reading

Interest Free Credit Offers Are Still Valid – Get Yours Today!

If you have bad credit, chances are good that you’re not going to get an interest free credit card. However, if you have been taking good care of your credit, it’s time to get some reward for your hard work. Enter the zero percent APR credit card offer. These offers are now being saved for creditholders that have great credit scores — yes, even in this economy — and they need a little more credit. You might find that you get to actually enjoy 0% APR for 15 months or better.

There’s plenty of good credit offers. If you’re looking around for credit after a long time of not even being bothered, you might want to actually think about shopping around. Just because an offer says 0% doesn’t mean that it’s not just a teaser rate. You want to see where your rate will go after you actually exceed that intro rate. If the interest rate is too high based on your score, then it’s better to avoid that card.

Interest Free Credit OffersThe Internet is a great way to actually shop around without fear. You’ll be able to check out multiple offers and see which ones would be a good fit. But you can’t forget to look at the fine print. If you aren’t looking at the fine print before you sign up, you might be in for a wild ride.

Do you want rewards points? You can get them, but you might end up paying a little more in terms of interest than other people. You have to really think about things like this. Credit card companies are a business, and that business is to make money. There’s nothing wrong with that, but you need to really figure out what you’re going to do and how you’re going to do it. It’s your life, and it’s your credit. Nobody can really tell you what to do — all we’re doing here is giving you something that you might want to keep in mind.

Do you really need another credit card? You might want to actually get one for emergency purposes, especially if your short term emergency fund isn’t as robust as you would like yet. There’s a lot of reasons to get another credit card. It can actually improve your credit score over time if you’re willing to be responsible with it.

So, what do you think about these cards? Sound off in the comments, and good luck!