Credit cards are actually a loan in disguise. They are not free money. If this golden rule is understood it would prove to be the first step towards avoiding the never-ending credit card debt. Taking a credit means taking a loan from someone who has extra at this time when you don’t. But this is the beginning of the credit card debt. Credit card debts come in handy while traveling and other expenses where cash is hard to find or hard to carry. Moreover it is good to have credit card debt limit free for times when cash is sparse. Many people overspend on credit cards and end up in credit card debt. The vicious circle never ending high credit card debt interest start and finally leads to total loss of peace of mind. To avoid credit card debt some important note should be made about spending patterns. Credit…

Credibility counts. And no one knows it better then the credit bureaus. These are the places where you can get a rating to certify your creditworthiness. And of course they charge you for it. The approach is simple enough. They keep an eye on the credit transaction that a person enters into and then its repayment. The banks and credit card companies use this information before striking a business with an individual. Credit bureaus are not watchdogs. They are just observers who want to know if a borrower is respecting the borrowed monies. They have to keep a track of how borrowed money is used. Trans Union, Equifax etc. are some of USA’s credit bureaus. They are governed under an act and also under a mandate to revive a person’s reputation if he can get a hiatus of at least seven years after one bad credit. But if one goes…

The three major consumer credit bureaus in the U.S. have recently created a new credit scoring system that will give financial institutions a more consistent evaluation of the credit worthiness of applicants. The three agencies — Equifax, Experian and Transunion — have introduced the new system called “VantageScore”. The new scoring system will be used immediately for reporting to banks, lenders, and credit card companies, and will be available to consumers later in the year. This means that instead of the companies providing three different sets of evaluations — often quite different — there will be much less variation within an applicant’s file. All three companies will be using the same formulas to arrive at their credit evaluations. A spokesperson for the group said scores will be “virtually the same across all three of the national reporting companies.” But consumer advocacy groups are not impressed with the new system. Since one of…

The idea of a balance transfer deal was introduced to the UK in the year 2000 by innovative online bank Egg plc, who offered customers a bait of 0% interest for six months on balances they transferred from another credit card. The feature was an instant hit, and more and more card issuers began to offer similar deals as competition for customers grew more intense. Before long, it seemed that every card available had 0% deals of ever-increasing lengths. It didn’t take long for savvy cardholders to spot a pretty major flaw in the credit industry’s thinking though. With so many cards offering 0% deals, what’s to stop people from becoming serial balance transferers, moving their debt to a new card as the 0% period expires? And so the game of credit card surfing began. People began to systematically switch their balances to card after card, and if they were…

Credit cards are easy, right? You have a credit limit. As long as your balance isn’t as high as your credit limit, you can pay for things with your credit card. When you pay for something with your credit card, you don’t have to pay for it until later. You pay interest on your credit card balance and as long as you don’t go over your credit limit, everything’s fine. Well, not quite. Here are some of the most frequently asked questions about credit cards – and their answers, of course. What’s interest? In a nutshell, interest is money that you pay a lender for the privilege of using HIS money to buy something. What’s this about ‘interest rates’ and percentages? The interest rate is a way of determining how much you’re paying for borrowing money on your credit card. It’s stated as a percentage of the outstanding balance on your…