Bad Credit – Fast Paths http://fastpaths.com/ Sun, 25 Sep 2022 03:27:54 +0000 en-US hourly 1 https://wordpress.org/?v=5.9.3 https://fastpaths.com/wp-content/uploads/2021/05/default.png Bad Credit – Fast Paths http://fastpaths.com/ 32 32 One Thing You Can’t Afford Anymore: Having Bad Credit https://fastpaths.com/one-thing-you-cant-afford-anymore-having-bad-credit/ Sun, 25 Sep 2022 01:00:00 +0000 https://fastpaths.com/one-thing-you-cant-afford-anymore-having-bad-credit/ If you think inflation feels bad at the grocery store or at the gas pump, consider the pain it inflicts on a credit card statement, where higher prices don’t just impact the cost of the items purchased, but also on the financing to pay for them. And according to several recent studies, a growing number […]]]>

If you think inflation feels bad at the grocery store or at the gas pump, consider the pain it inflicts on a credit card statement, where higher prices don’t just impact the cost of the items purchased, but also on the financing to pay for them.

And according to several recent studies, a growing number of consumers are feeling this discomfort from the bills they see each month, as credit card balances approach record highs and look certain to surpass previous highs and eclipse 1 trillion dollars for the first time.

This is proof that many Americans engage in poor financial behavior.

Yes, I would like to believe that regular readers of a column like mine are financially responsible and not oblivious to debt; I hope what I’m about to say sounds mostly like a sermon given to the choir.

But as times change, strategies with credit change too. Behaviors that were acceptable and responsible a short time ago are no longer as healthy or appropriate today, a situation that will only get worse until interest rate hikes stop and inflation step back.

Meanwhile, the numbers suggest that many Americans — and the country as a whole — are headed for a credit card debt crisis.

Just last year, few people would have predicted such a thing.

As the pandemic took hold in 2020, Americans cut spending and focused on debt reduction; National credit card debt fell from a record $927 billion in the fourth quarter of 2019 to $770 billion in the first quarter of 2021, according to consumer debt data from the Federal Reserve. Bank of New York.

Since then, however, Americans have added more than $100 billion to their revolving credit balances, which now total some $887 billion.

With inflation and interest rates on the rise – along with other factors that are struggling for many consumers – it’s a lock that the old record will soon be broken, likely by the end of the year. ‘year.

At the same time, the rates themselves break another record, for the highest average credit card rate nationwide.

Bankrate.com pegs average credit card rates at over 18%, the highest since 1996.

This barely explains the Federal Reserve’s latest interest rate hike, which card issuers hadn’t fully digested before the central bank raised interest rates by 0.75 percentage points. Wednesday.

In addition, the Fed has signaled that it will likely raise rates again – by a total of 1.25% – before the end of the year.

Ouch.

LendingTree, which in 2019 began tracking rates on 200 of the nation’s most popular credit cards (issued by over 50 lenders) recently pegged the average credit card interest rate at around 21.6%, a record.

And several studies show that the average interest rate on new cards issued today is north of 21%.

With further increases already planned, rates of 25% will not be outliers by the time New Year’s Day rolls around.

This should be enough to dissuade consumers from going into debt, but it is not.

LendingTree analysts calculated the national average card debt among people with outstanding balances to be $6,569. Meanwhile, a CreditCards.com study released this week showed that nearly two-thirds of credit card debtors have had a balance for at least a year.

If you’re constantly faced with credit card bills – never resetting balances after big purchases or just regular monthly expenses – then carrying credit card debt isn’t a temporary way to getting by is an ongoing part of your financial strategy.

Good luck with this, as high prices and higher rates will make it harder to repay in the future, adding years to the time it takes to zero a bill by paying at or near minimum.

Worse still, although you can try to blame the situation on the economy and rising prices, most credit card debt problems are the fault of the borrower.

Yeah, the dollars aren’t going as far now as they were a year ago. But this doesn’t just apply to the goods you buy, it also affects the interest you owe. If you have $5,000 in credit card debt and are making monthly payments of $500 while trying to reduce the balance, less of your money is now going to the principal (unless you have a fixed rate card).

Your behavior may not have changed, but your payment date is further away and your efforts have become less effective.

The good news, if there is any, is that so far consumers seem to be paying their bills. Delinquency levels are historically low, and the debt-to-income ratio is not exceptionally high.

That could change overnight, however, as the cumulative effects of more expensive everyday life continue to knock on our doors.

With this in mind, consumers need to fine-tune their spending and eliminate all high-interest debt.

With so few investment products currently promising double-digit returns, anyone with debt to repay should consider “investing” in repayment as a good return on their money.

Making progress is tough with inflation north of 8%, so write down any debts, track your spending, and see where you can cut ledger expenses to improve the outlook for what you owe.

Trade-offs can be difficult, but ask yourself if debt is causing more pain – monetary or emotional – than spending cuts; if so, tackle the debt.

Consider refinancing where possible. There are still low rate balance transfer offers available; consider moving credit card balances, but beware of transfer fees and the costs that will arise if you can’t pay off the debt before the interest rate expires and the normal rate comes in to kick your ass buttocks.

Consider the timing of major purchases and evaluate financing options before heading to the store or dealership. Monitor your credit rating; the more progress you can make to improve it now, the more it can help you if you need to seek a refinance deal down the road.

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Move away from a traditional credit-focused approach https://fastpaths.com/move-away-from-a-traditional-credit-focused-approach/ Fri, 23 Sep 2022 06:09:20 +0000 https://fastpaths.com/move-away-from-a-traditional-credit-focused-approach/ With the pandemic behind us, the moratorium and restructuring opportunities announced by the RBI to help borrowers facing financial difficulties overcome the cash flow disruption caused by lockdowns and general business disruption, are coming to an end. However, as moratorium measures as well as one-off restructuring opportunities come to an end, banks could start to […]]]>

With the pandemic behind us, the moratorium and restructuring opportunities announced by the RBI to help borrowers facing financial difficulties overcome the cash flow disruption caused by lockdowns and general business disruption, are coming to an end. However, as moratorium measures as well as one-off restructuring opportunities come to an end, banks could start to see a substantial increase in bad debts. According to the RBI Financial Stability Report released in July 2021, macro stress tests indicate that the gross non-performing assets (GNPA) ratio of SCBs could rise from 7.48% in March 2021 to 9.80% by March 2022 in the baseline scenario; and 11.22% in a severe stress scenario.

The current economic climate continues to be uncertain and financial institutions need to be able to distinguish bad credit from good early on. Financial institutions today focus on the use of several generic criteria such as macroeconomic indicators, overall industry trends and internal operational parameters such as compliance with regulatory filings, inventory audits at a given time , related party transactions, sponsor ownership pattern and high value. payment trends for corporate and SME wallet. On the retail side, early warning indicators focus on overall portfolio analysis and limited statistical models that can rely on credit bureau data and borrower payment behavior. This current set of tools and processes used by financial institutions provides only vague answers about impending stress in the loan portfolio and does not allow investigation of the extent of the problem. For example, the use of macro trends or general industry sentiment only establishes trends, but does not provide insight into the actual credit problem at the borrower level. Similarly, using standard credit risk models and financial ratios provides outdated analysis and ignores obvious errors in free cash flow projections. Due to the intrinsic nature of these signals being indicative, financial institutions are also limited in their ability to define corrective actions to prevent further deterioration of their loan portfolio.

While financial institutions understand the need for early warning signals (EWS) to tell bad credit from good credit, re-running old models and indicators only leads to vague plausible answers to identify credit stress. SAP tools should expand beyond generics and focus on identifying specific issues with borrowers to distinguish bad credit from credit requiring liquidity support to get through. The scope of the SAP mechanism must also extend beyond the identification of credit-related stress. SAP measures should be generalized to include factors such as anti-money laundering, fraud, market and liquidity risk measures in order to be able to identify money laundering, embezzlement, fraud and other liquidity and solvency issues.

With the scope and approach of SAP requiring massive change, financial institutions need a complete overhaul of technology and thought process to overcome this challenge. From a reactive checklist-based approach focused on limited internal organizational and macroeconomic factors, financial institutions should focus on leveraging data and machine learning models to gain insights specific to the business. borrower in multiple dimensions such as credit, liquidity, fraud and anti-money laundering. Using techniques and technologies such as web scraping, APIs and open data frameworks, the universe of data sources ranging from desktop data to alternative data sources, social media feeds, events news and macroeconomic data has become readily available. These should be combined with borrower-specific information available from the financial institution to generate specific, on-demand information on borrower behavior and risk predictions.

Regardless of the size and portfolio of the financial institution, having a holistic view of SAP specific to the borrower is the need of the hour. The SAP framework provided by the regulator is a starting point, but SAP systems to predict operational, environmental and/or financial stresses in borrower accounts early on using the power of data will become extremely critical for banks and creditors. financial institutions. Financial institutions should consider investing in smart EWS platforms that have integrated data pipeline mechanisms to ingest data from multiple sources and a flexible interface to cover qualitative and quantitative methods of identifiers across demographics, behavioural, operational, financial, managerial and environmental. Using metrics such as EWI hit rate, asset group performance, and remediation/response performance, the built-in models of an EWS can go through a constant calibration process to improve accuracy. forecasts.

With this, EWS systems using a traditionally reactive or ad hoc method can be revamped to be able to make them relevant to the current situation.



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Disclaimer

The opinions expressed above are those of the author.



END OF ARTICLE



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Visa Petal 2 “Cash Back, No Fees” Credit Card: The Best Card for Fair Credit https://fastpaths.com/visa-petal-2-cash-back-no-fees-credit-card-the-best-card-for-fair-credit/ Tue, 20 Sep 2022 13:17:47 +0000 https://fastpaths.com/visa-petal-2-cash-back-no-fees-credit-card-the-best-card-for-fair-credit/ The Petal® 2 “Cash Back, No Fees” Visa® Credit Card is the rare card that offers a rewards program for people with lower credit scores, providing the ability to earn money while you build your credit — even if your credit score is as low as 580. Also unusual: it requires no security deposit, charges […]]]>

The Petal® 2 “Cash Back, No Fees” Visa® Credit Card is the rare card that offers a rewards program for people with lower credit scores, providing the ability to earn money while you build your credit — even if your credit score is as low as 580.

Also unusual: it requires no security deposit, charges no annual fee, foreign transaction fees even late fees. Instead, it incentivizes cardholders to make payments on time by providing additional cash back opportunities. As long as you make your payments on time, using this card will cost you nothing, even for purchases made while traveling abroad. As such, it’s a solid option for a first credit carda credit card for students or a card for people with a lower credit score.

Awards

The Petal 2 Visa is a flat-rate rewards card that gives you the opportunity to earn the same amount of rewards on all of your eligible purchases, regardless of spend category (for context, some credit cards specialize in certain types of purchases, such as gas credit cards Where grocery credit cards.) But, there is a built-in twist to incentivize good credit-building behavior.

You’ll earn 1% on all of your eligible advance purchases. When you make 12 one-time monthly payments, you earn an additional 0.5% cash back for a total of 1.5% – instead of penalty late fees. And some local small businesses offer an additional 2% to 10% discount on purchases at select merchants, which you can find through the Petal app.

welcome bonus

The Petal 2 Visa offers no welcome bonuses – a common practice among cards designed for people with lower credit scores. Check out CNET’s list of best credit card welcome bonuses to see options for applicants with higher credit.

Petal 2 credit limit

Petals 2 Credit limit – that is, the limit you can spend on the card – ranges from $300 to $10,000, depending on creditworthiness. Your credit score, income, housing payments, and other factors will help determine your initial credit limit, but you can request an increase after demonstrating responsible use over time.

More credit cards designed for people with fair or average credit are secure credit cards; you must deposit money into your account before spending it. Even among these types of cards, it’s hard to find one with a credit limit of $10,000. Although a larger line of credit carries the risk of overspending, it can help build your credit score by minimizing your credit utilization rate.

Alternate Maps

While the Petal 2 visa stands out among the crowd, there are alternatives that may be better suited to students or applicants with particularly poor credit.

Discover it® Student Cash Back

Registered students are eligible for student credit cards, which generally offer more modest rewards. The Discover it® Student Cash Back* is CNET’s choice for the best student credit card on the strength of its rewards potential, which is even better than the Petal 2 Visa.

You’ll earn 5% cash back on a rotating quarterly category when you activate it (up to $1,500 spend per quarter, then 1%) and 1% on all other purchases. And with Discover’s Unlimited Cashback Match Welcome Bonus, you can essentially double your annual cash back earned at the end of your first year.

For more information on the Rotary Quarterly category and other benefits, check out our full review of the Discover the Student Cash Back Card.

Credit One Bank® Platinum Visa® for Credit Reconstruction

The Credit One Bank® Platinum Visa® for Rebuilding Credit* has a less compelling rewards structure than the Petal 2 Visa – but it unsecured credit card has less stringent eligibility requirements, as applicants with a credit score below 580 may be approved.

There is an annual fee of $75 for the first year, which increases to $99 thereafter. You’ll earn 1% cash back on eligible gas and grocery purchases, plus your monthly cell phone, Internet, cable and satellite TV bills. It’s not as good as the Petal 2 rewards, but it’s better than most other bad credit cards.

FAQs

What if my credit score is below 580?

If your credit score is below 580, your chances of approval are significantly lower. There are, however, credit cards designed for people with bad credit, including secured credit cards that require you to put down a security deposit.

How can I improve my credit?

Responsible use of the Petal 2 Visa or any other credit card will help you build your credit. For most, that means making payments on time and in full, while keeping your balance at or below 30% of your total credit limit (your credit utilization rate). Credit card issuers will automatically report your spending and payment activity to major credit bureaus.

How does the APR of the Petal 2 compare?

The Petal 2 has a standard variable APR of 15.24% to 29.24%, although your particular APR depends on your credit score. Generally, the lower your credit score, the closer you can expect your APR to be in that range.

* All information about Discover it Student Cash Back and Credit One Bank Platinum Visa for Rebuilding Credit has been independently collected by CNET and has not been reviewed by the issuer.

Editorial content on this page is based solely on objective, independent assessments by our editors and is not influenced by advertising or partnerships. It was not supplied or commissioned by a third party. However, we may receive compensation when you click on links to products or services offered by our partners.

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Top 10 Strategies to Boost Your Credit Score in No Time https://fastpaths.com/top-10-strategies-to-boost-your-credit-score-in-no-time/ Sun, 18 Sep 2022 11:48:12 +0000 https://fastpaths.com/top-10-strategies-to-boost-your-credit-score-in-no-time/ Your credit score is the most important indication of your financial situation. It gives lenders a quick snapshot of your credit usage habits. As your score increases, you automatically have a better chance of being approved for new loans or lines of credit. Also, if you have a higher credit score, you might be able […]]]>

Your credit score is the most important indication of your financial situation. It gives lenders a quick snapshot of your credit usage habits. As your score increases, you automatically have a better chance of being approved for new loans or lines of credit. Also, if you have a higher credit score, you might be able to borrow money at the lowest interest rates.

If you want to know more about credit rates, feel free to visit FinImpact. Now let’s take action. What are the best ways to quickly improve your credit score?

Photo, Dylan Gillis.

#1: Review your credit reports

Your credit report should be your first step if you want to increase your credit score because it contains the data that forms the basis of your credit score. Your debt, repayment history, and credit management are all included in your credit report. It could also contain details of your overdue invoices, repossessions and bankruptcies.

#2: Disputed Credit Report Errors

You are entitled to an accurate credit report, which means you can dispute any inaccuracies by contacting the appropriate credit reporting agency, which has 30 days to review the issue.

Your credit score can be negatively affected by errors, which can result from data entry errors made by creditors, social security numbers, birthdays or easily exchangeable addresses, or data theft.

#3: Target 30% or less credit utilization

The percentage of your credit limit that you are currently using is called your credit utilization.

The easiest way to control your credit usage is to pay off your credit card balance in full each month. If you still can’t do this, a good rule of thumb is to keep your total outstanding amount at 30% of your total credit limit or less.

The next step is to focus on reducing it to 10% or less, as this is what is advised to increase your credit score.

Top 10 Strategies to Boost Your Credit Score in No Time

Photo, Sophie Dupau.

#4: Avoid applying for new credit cards

Avoid submitting new credit applications while you try to restore your credit. The lender will frequently perform a “thorough investigation” when you apply for new credit, which is a credit check that appears on your credit report and affects your credit score.

Your level of risk as a borrower is reflected in the number of credit accounts you have recently opened and the number of difficult applications you have received. therefore, these two factors account for 10% of your credit score.

#5: Eliminate past due balances

A major factor affecting your credit is your payment history, which accounts for 35% of your credit score. Your credit score suffers more the longer you go without making payments.

After reducing new credit card purchases, use the money you’ve saved to pay off your outstanding card balances before they’re charged (the licensor has closed the account for future use) or given to a agency collection.

#6: Eliminate your debt

You will need to start paying off this debt in order to improve your credit score because the percentage of your total credit that you hold in debt is 30% of your credit score.

Think of the debt avalanche approach and the debt snowball method if you have positive cash flow, meaning you’re making more money than you owe.

Top 10 Strategies to Boost Your Credit Score in No Time

Photo, CardMapr.nl.

#7: Leave accounts open

It’s rare to cancel a credit card to boost your credit score. Make sure closing an account won’t do the bare minimum to your credit before you do so. You might be tempted to cancel overdue credit card accounts, but the balance will remain on your credit report until it’s paid in full. It is advisable to keep the account active and make payments on time each month to reduce the balance.

#8: Use credit monitoring to track your progress

Credit monitoring programs make it easy to track changes in your credit score. These services, many of which are free, keep tabs on changes to your credit report, including a refunded account or a newly created account.

Many of the best credit monitoring programs can help you avoid fraud and identity theft.

#9: Consider Debt Consolidation

If you have a lot of outstanding debt, it may be beneficial for you to get a debt consolidation loan from a bank or credit union and use that to pay them all off. Since you only have to worry about one payment, if you can get a loan with a lower interest rate, you can pay off your debt faster. It could improve your credit score and reduce the amount of credit you use.

#10: Talk to your creditors

Although calling your credit card provider may be the last thing you want to do, you might be happy with the help you can get. Communicate with your creditors about your situation if you are having trouble.

Many companies offer short-term hardship plans that will lower your interest rate or monthly payments while you work to get back on your feet. They might even be able to reach a mutually beneficial deal if you let them know you might miss an upcoming payment.

Conclusion

Raising your credit score is smart, especially if you want to get one of the best credit cards or take out a loan to buy an important item like a new vehicle or a new house.

However, keep in mind that improving your score may take a few weeks or even months. So, while patience isn’t a factor in calculating your credit score, it’s a quality you’ll need while working to restore your credit.

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Best personal lenders for a 550 credit score https://fastpaths.com/best-personal-lenders-for-a-550-credit-score/ Fri, 16 Sep 2022 20:06:50 +0000 https://fastpaths.com/best-personal-lenders-for-a-550-credit-score/ Our goal at Credible Operations, Inc., NMLS Number 1681276, hereafter referred to as “Credible”, is to give you the tools and confidence you need to improve your finances. Although we promote the products of our partner lenders who pay us for our services, all opinions are our own. It’s harder to qualify for a personal […]]]>

Our goal at Credible Operations, Inc., NMLS Number 1681276, hereafter referred to as “Credible”, is to give you the tools and confidence you need to improve your finances. Although we promote the products of our partner lenders who pay us for our services, all opinions are our own.

It’s harder to qualify for a personal loan with a 550 credit score, but it’s possible. (Shutterstock)

Having a low credit score does not completely eliminate your personal loan options. Some lenders offer personal loans for people with credit scores as low as 550, which is considered a bad score. But these lenders usually charge higher interest rates to offset their risk of lending to a borrower with bad credit.

Here is some additional information about your personal loan options if you have a 550 credit score.

Credible, it’s easy to compare personal loan rates from various lenders, all in one place.

Can you get a personal loan with bad credit?

Some lenders offer loans to consumers with bad credit, but you’ll likely get a higher interest rate and less favorable terms than someone with good credit. All lenders have different credit score requirements, but scores below 600 for the FICO and VantageScore credit score models are generally considered poor or very poor.

If you’re having trouble qualifying for a personal loan with decent interest rates because you have a bad credit scoreadding a co-signer with good credit to your personal loan application can improve your chances of qualifying for lower interest rates.

Best personal loans for a 550 credit score

The following two credible partner lenders accept personal loan applicants with a 550 credit points:

Before

  • Minimum credit score: 550
  • Loan amounts: $2,000 to $35,000
  • Loan conditions : 2 to 5 years
  • Costs: Assembly costs

OneMain Financial

  • Minimum credit score: None
  • Loan amounts: $1,500 to $20,000
  • Loan conditions : 2 to 5 years
  • Costs: Assembly costs

Best personal loans for credit scores below 600

These six credible partner lenders accept credit scores between 550 and 600 for their personal loans:

best egg

  • Minimum credit score: 600
  • Loan amounts: $2,000 to $50,000
  • Loan conditions : 2 to 5 years
  • Costs: Assembly costs

loan club

  • Minimum credit score: 600
  • Loan amounts: $1,000 to $40,000
  • Loan conditions : 3 or 5 years
  • Costs: Assembly costs

LendingPoint

  • Minimum credit score: 580
  • Loan amounts: $2,000 to $36,500
  • Loan conditions : 2 to 6 years old
  • Costs: Assembly costs

Universal Credit

  • Minimum credit score: 560
  • Loan amounts: $1,000 to $50,000
  • Loan conditions : 3 to 5 years
  • Costs: Assembly costs

Upgrade

  • Minimum credit score: 560
  • Loan amounts: $1,000 to $50,000
  • Loan conditions : 2 to 6 years old
  • Costs: Assembly costs

Reached

  • Minimum credit score: 580
  • Loan amounts: $1,000 to $50,000
  • Loan conditions : 3 to 5 years
  • Costs: Assembly costs

Visit Credible for view your prequalified personal loan rates from various lenders, without affecting your credit.

Other Lenders to Consider

The following two lenders are not Credible partners, so you won’t be able to easily compare your rates with them on the Credible platform. But they may also be worth considering if you’re looking for a personal loan with a 550 credit score.

NetCredit

  • Minimum credit score: don’t divulge
  • Loan amounts: $1,000 to $10,000
  • Loan conditions : 6 to 60 months
  • Costs: Origination fee (in some states)

Timely

  • Minimum credit score: don’t divulge
  • Loan amounts: $300 to $12,000
  • Loan conditions : 24 to 54 months
  • Costs: Assembly costs

Methodology

Credible assessed the best personal lenders for a 550 credit score based on factors such as customer experience, minimum fixed rate, maximum loan amount, length of financing, loan terms and fees. Credible’s team of experts gathered information from each lender’s website, customer service, and via email support. Each data point was checked to ensure it was up to date.

How to apply for a personal loan with a 550 credit score

If you are planning to apply for a personal loan in the near future and you have a credit score of 550, you may want to put those plans on hold until you can improve your credit. The higher your score, the easier it is to qualify for loan products and get better interest rates.

Opening of a secured personal loan, a secured credit card or a credit loan can help you improve your credit before applying for an unsecured personal loan. You can also become an authorized user on a family member’s credit card to improve your credit score.

When it’s time to apply for a personal loan, the application process may be different depending on which lender you are applying to. But you can generally expect to follow the following steps:

  1. Compare the prices. Research different lenders to find those that lend to borrowers with lower credit scores.
  2. Get prequalified. Once you find a few lenders, fill out their prequalification forms to see what rates and terms you might qualify for.
  3. Complete the application. Most lenders have quick and easy online applications to complete. You will need to provide information proving your identity and income, such as a copy of government-issued photo ID, recent pay stubs, tax returns, or bank statements.
  4. Close the loan and receive funds. If you are approved for a loan, you will sign a loan agreement and the lender will disburse your funds, usually by direct deposit to your bank account. You will then start making payments on the loan as agreed.

Don’t forget that you also have the option of applying with a co-signer. If the co-signer has a good credit rating, this can help you qualify for better interest rates, as the lender can rest assured that someone with a strong credit history will be responsible for making the loan repayments if you you are unable to do so.

If you’re ready to apply for a personal loan, Credible makes it quick and easy compare personal loan rates to find the right one for your situation.

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Is credit consolidation a bad idea? Here’s what Dave Ramsey thinks https://fastpaths.com/is-credit-consolidation-a-bad-idea-heres-what-dave-ramsey-thinks/ Wed, 14 Sep 2022 15:00:26 +0000 https://fastpaths.com/is-credit-consolidation-a-bad-idea-heres-what-dave-ramsey-thinks/ Image source: Getty Images If you’re thinking about credit consolidation, you might want to read Dave Ramsey’s advice. Key points Credit consolidation is the consolidation of multiple credit cards into one debt, which can often lower your interest rate. Still, financial expert Dave Ramsey thinks that’s a bad idea. Ramsey notes that when you consolidate […]]]>

Image source: Getty Images

If you’re thinking about credit consolidation, you might want to read Dave Ramsey’s advice.


Key points

  • Credit consolidation is the consolidation of multiple credit cards into one debt, which can often lower your interest rate.
  • Still, financial expert Dave Ramsey thinks that’s a bad idea.
  • Ramsey notes that when you consolidate your debt, you’re not really solving the debt problem.

Financial expert Dave Ramsey urges people to take debt repayment seriously and focus on paying off their debt as quickly as possible. But there’s one debt repayment tool he thinks might not be a good idea to use: credit consolidation.

As Ramsey explained, “Credit consolidation is the process of accepting multiple credit card payments (with very high interest rates) and consolidating them into one payment. The goal of consolidation is to exchange all those payments and high interest rates for a loan with one payment and a low interest rate.”

Swapping expensive debt for cheaper debt might sound like a good idea, and even Ramsey admits it “sounds good.” But, despite the fact that credit consolidation may at first glance seem like a good approach to getting out of debt, Ramsey is not a fan of it.

Here’s what Dave Ramsey has to say about credit consolidation

Ramsey has a few key objections to consolidation.

First and foremost, it says you might not always get a better rate when you consolidate your debt — and sometimes your new loan can charge even higher interest than your existing debt. In this situation, he rightly points out that there would be no advantage to using this approach.

But even if you can get a better rate, he still doesn’t believe that credit consolidation is a good approach to take. It’s because “You can’t borrow to get out of debt.”

Ramsey said if you consolidate your debt, you’re not solving the real problem, which he says is that you’re not sending enough extra money to your creditors and you have no control over your spending. .

A lower interest rate won’t solve these problems, he explained, so you shouldn’t look to credit consolidation as a solution.

Is Ramsey right?

As mentioned above, Ramsey is correct that you wouldn’t want to consider credit consolidation if you had to do it at a higher interest rate. In most cases, you also wouldn’t want to go through this process if you ended up paying the same rate as on your current debt – especially if your new loan would lengthen your repayment time since the extra time spent paying interest will make reimbursement more expensive.

However, he is wrong about whether credit consolidation can help. Despite what he says, sometimes the high interest rate is really the problem when it comes to debt repayment. You may have reformed your spending habits and sent every dollar you can to your creditors, but if your interest rate is 27%, it will still be much harder to get out of debt than if your interest rate is 27%. interest is 7%. %.

So while you shouldn’t assume that simply consolidating your debt will help you out, you should Definitely consider taking this step to lower your interest rate if you’re serious about paying down debt and committed to not falling back into the hole.

If you can lower your financing costs, all those extra dollars you work so hard to send to your creditors will not only be eaten up in interest, but they’ll actually help the principal balance drop faster.

There’s no reason for you would not want this – and every reason to move forward to make it easier for you to pay off your debts so you can get out of debt faster and with a lot less stress.

The best credit card waives interest until 2023

If you have credit card debt, transfer it to this top balance transfer card guarantees you an introductory APR of 0% in 2023! Plus, you won’t pay any annual fees. These are just a few of the reasons why our experts consider this card a top choice to help you control your debt. Read our full review for free and apply in just 2 minutes.

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Petition circulating asking Waynesboro City Council to consider a rent inspection program https://fastpaths.com/petition-circulating-asking-waynesboro-city-council-to-consider-a-rent-inspection-program/ Mon, 12 Sep 2022 22:42:00 +0000 https://fastpaths.com/petition-circulating-asking-waynesboro-city-council-to-consider-a-rent-inspection-program/ WAYNESBORO, Va. (WHSV) – In Waynesboro, Va., the organization is calling for solidarity among tenants. A petition is circulating asking the city council to consider a rent inspection program. The goal is to prevent property deterioration, unsafe living conditions and neighborhood decline. “We’re seeing a lot of landlord neglect, which is the other side of […]]]>

WAYNESBORO, Va. (WHSV) – In Waynesboro, Va., the organization is calling for solidarity among tenants.

A petition is circulating asking the city council to consider a rent inspection program. The goal is to prevent property deterioration, unsafe living conditions and neighborhood decline.

“We’re seeing a lot of landlord neglect, which is the other side of the imbalance where people need a place to live, and there aren’t a lot of places to live in Waynesboro,” said said Nora Scott of Virginia Organizing.

This inspection would be the responsibility of the owner.

“If their property doesn’t meet that inspection, it has to be re-inspected for a period of time and like they can’t just rent if they don’t maintain their property,” Scott said.

Scott said too often renters, especially those with kids or bad credit, end up living in places with mold or broken appliances. They said tenants should know their rights.

“I feel like a lot of tenants right now don’t feel like they can engage in potentially predatory actions on the part of their landlord. They’re worried that if they say anything either or if they make a complaint, their landlord holds them back when they ask for a different accommodation,” Scott said.

A group of organizers went door-to-door asking about renting in Waynesboro, Scott said, and some told stories of poor living conditions. Others said their situation was good.

Either way, they said it was important to learn the details.

“We should care about what happens to our neighbors because it affects us whether we think it or not. You may be having a good time with the landlord you have now, but you move to another location in Waynesboro, and that could change,” Scott said.

To sign the petition or to learn more, visit the Virginia Organizing website.

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Benefits of bundling home and auto insurance https://fastpaths.com/benefits-of-bundling-home-and-auto-insurance/ Fri, 09 Sep 2022 20:33:14 +0000 https://fastpaths.com/benefits-of-bundling-home-and-auto-insurance/ Our goal is to give you the tools and confidence you need to improve your finances. Although we receive compensation from our partner lenders, which we will always identify, all opinions are our own. By refinancing your mortgage, the total finance charges may be higher over the life of the loan. Credible Operations, Inc. NMLS […]]]>

Our goal is to give you the tools and confidence you need to improve your finances. Although we receive compensation from our partner lenders, which we will always identify, all opinions are our own. By refinancing your mortgage, the total finance charges may be higher over the life of the loan.
Credible Operations, Inc. NMLS # 1681276, is referred to herein as “Credible”.

If you own a house and a car, you probably have insurance coverage for both. But since you probably purchased the policies at different times, you may have gone through a different insurer for each one. And you might pay more than necessary as a result.

Insurers generally offer discounts to customers who “bundle” their policies, that is, who buy both forms of insurance from the same insurer. They do this because the discount makes you more likely to purchase additional policies and reduces the risk of you switching to another insurer.

Although bundling can save you money, you’ll want to shop around to find the best rate available for each of your insurance policies.

Here’s what you need to know about bundling home and auto insurance:

What is a home and auto plan?

Home and auto insurance helps you protect two of your most valuable assets. When purchasing these policies, you may experience what is known as a bundle discount or a multi-policy discount. Insurers offer this incentive to entice customers to take out multiple policies with them.

According to the Insurance Information Institute, combining your home and auto policies can save you 5-15%, but some insurers may offer deeper discounts.

With the average homeowner paying $1,272 a year for home insurance and $1,204 a year to insure a vehicle, according to the National Association of Insurance Commissioners, bundling could save you more than $500 a year.

However, don’t assume that the first discount – or policy – offered to you is the best one. You’ll need to shop around to be sure you’re getting the best deal available to you. Credible makes it easy to compare policies and rates from different insurers to help you get the best policy for your needs, at a great price.

Compare home insurance from the best insurers

  • Entirely online, take out home insurance instantly
  • Compare quotes from highly rated home insurance companies in your area
  • No spam, phone calls, upsells or fake quotes

Get insurance quotes now

Benefits of bundling home and auto insurance

The exact amount you save by bundling your home and auto insurance policies varies by insurer. But saving money isn’t the only reason to bundle your policies. Other benefits include:

  • Simplified font management: Having all your policies with the same insurer makes it easy to view and change your coverages, review your bills and pay because you can do it all from one account.
  • Insurance Security: Bundling your policies could make your insurance provider less likely to drop your landlord’s coverage if you file multiple auto claims.
  • Combined deductibles: Some insurance companies set a single deductible shared between all your policies. So rather than having to pay a $500 deductible for damage to your home and another $500 deductible for damage to your car resulting from the same windstorm, for example, you would only have one $500 deductible that applies to both assets.
  • Increase in savings: Bundle discounts and other policy discounts are not an opportunity. You can stack discounts for even more savings.

Learn more: What does home insurance cover?

Disadvantages of bundling insurance policies

Bundling auto and home insurance policies makes sense to many consumers, but it’s not always the best solution. Consider these potential downsides:

  • Coverage may be insufficient: Bundled discounts can encourage you to shop by price rather than coverage. Coverages vary from insurer to insurer, and not putting coverage first can leave you underinsured.
  • Bundling discourages purchases: If you feel like you’re getting a very low price on your fonts, you might be less inclined to shop around for a better deal.
  • Reduced flexibility: Bundling policies means that you must accept the coverage offered by the insurer. You may find that the best home and auto insurance policies come from two different providers.
  • Not always cheaper: An insurance company with higher premiums than its competitors won’t necessarily discount enough of a plan to save you money.

Check: Comprehensive car insurance: what does it mean?

How to save the most money

You can expect to save at least 5% on your premiums if you purchase two or more insurance policies from the same insurer. But to maximize your savings, try these tips:

  • Review your policies. Periodically review your insurance coverages to make sure you’re not paying for coverage you no longer need, such as an endorsement for an expensive musical instrument you no longer own or collision damage waiver on a passenger car. low value.
  • Look for additional discounts. Maybe your credit score has improved or you’ve retired since you took out your policy. These life changes could entitle you to lower rates. You might also have gotten a discount if you recently installed sophisticated security equipment in your home.
  • Buy quotes. As you review your coverages and look for discounts, shop around to see if you can find the right coverage for less with another carrier.
  • Consider increasing your deductible. It’s important to make sure you can pay your deductible in case you need to file a claim. otherwise, you will not be able to complete repairs to your home or car. However, you may be able to get away with a higher deductible if your insurer combines deductibles for bundled policies.

Good to know: A deductible is the amount you pay out of pocket before your insurance starts paying for a covered event or peril. Deductibles work the same way for homeowners and auto insurance. Generally, the higher your deductible amount, the lower your premium will be.

Is bundling auto and home insurance right for me?

Bundling policies can save you money, but not always. It makes sense to compare quotes for bundled and separate policies from a few different providers.

That said, some circumstances lend themselves well to grouping, and others do not:

  • Large owners insurance contract: The larger your policy, the more you can save. If you’re insuring a high-value home or a home in an expensive market, a package could earn you a significant discount.
  • Bad credit: A bad credit history can prevent you from obtaining preferential rates from certain insurers. Low-cost policies, even if they come from separate insurers, might cost you less than bundled policies from an insurer with stricter credit guidelines.
  • High car insurance premium: If traffic tickets, accidents, or other circumstances have resulted in unusually high auto insurance premiums for you, a discount auto insurer will likely be a cheaper option than bundled policies from a traditional carrier.

Shopping for homeowners and auto insurance is serious business that can mean the difference between securing your financial future and exposing yourself to unnecessary risk and expense. This is why it is important to compare rates with multiple carriers before purchasing a policy.

Credible lets you compare rates from over 40 reputable partner carriers. Our platform is easy to use and you’ll quickly have the information you need to find a great deal on the best policy for you.

Need home insurance?
The Credible Marketplace, which includes Young Alfred’s insurance services, makes it easy to find an insurer and policy that’s right for you.

  • fully online — Complete all insurance forms online and purchase home insurance without ever picking up the phone. If you have any questions, Young Alfred offers 24/7 customer service.
  • Save time, money and effort – Compare quotes from highly rated home insurance companies in your area. It’s quick and easy.
  • Data Privacy — Your information is kept secure. We do not sell your information to third parties and you will not receive any unwanted phone calls from us.

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Disclaimer: All insurance related services are provided by Young Alfred.

About the Author

Daria Uhlig

Daria Uhlig is a Credible contributor who covers mortgages and real estate. His work has appeared in publications such as The Motley Fool, USA Today, MSN Money, CNBC and Yahoo! Finance.

Read more

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$50,000 Kaiser Permanente Grant to Improve Financial Literacy https://fastpaths.com/50000-kaiser-permanente-grant-to-improve-financial-literacy/ Tue, 06 Sep 2022 02:01:27 +0000 https://fastpaths.com/50000-kaiser-permanente-grant-to-improve-financial-literacy/ September 5, 2022, 4:00 PM HST * Updated September 5, 2:35 p.m. Permanent Kaiser According to the Bureau of Labor Statistics, the consumer price index rose 9.1% from a year ago. Financial stress can trigger feelings of shame, anger, and depression, affecting a person’s overall mental and physical health. To help Hawaiian families, Kaiser Permanente […]]]>

September 5, 2022, 4:00 PM HST
* Updated September 5, 2:35 p.m.

Permanent Kaiser

According to the Bureau of Labor Statistics, the consumer price index rose 9.1% from a year ago. Financial stress can trigger feelings of shame, anger, and depression, affecting a person’s overall mental and physical health. To help Hawaiian families, Kaiser Permanente awarded a $50,000 grant to Goodwill Hawai’i aimed at improving financial literacy and corresponding health inequalities among low-income people.

The grant is part of a $2.5 million grant package that Kaiser Permanente has awarded to Change Machine, an organization that helps build financial security for people in low-income communities. Through the grant, Change Machine will provide its financial coaching platform and training to 190 social service organizations in eight states and the District of Columbia, including Goodwill Hawai’i, and aims to reach 100,000 people annually.

Goodwill Hawai’i will use the Change Machine platform to help individuals and families manage financial matters such as loans and debts, taxes, budgeting, savings and credit building. The program also helps build capacity to ensure the stability of financial coaching programs at Goodwill Hawai’i. Additionally, Goodwill Hawai’i will have access to tools that support collaboration between financial practitioners and community leaders.

“Debt, bad credit and financial insecurity can affect your physical and mental health,” said Greg Christian, president of Hawaiian Market, Kaiser Foundation Health Plan and Hospitals. “This grant will provide Hawaii residents with access to tools and services to improve financial literacy and help reduce economic and health disparities in our community.”

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Start in college? Here’s why a student credit card is essential https://fastpaths.com/start-in-college-heres-why-a-student-credit-card-is-essential/ Sun, 04 Sep 2022 11:00:29 +0000 https://fastpaths.com/start-in-college-heres-why-a-student-credit-card-is-essential/ Image source: Getty Images Now is the perfect time to start building a good credit history. Key points Student credit cards are a good introduction to credit for students. If you get a student credit card and pay the bill on time, it can help you build a high credit score. The fall semester is […]]]>

Image source: Getty Images

Now is the perfect time to start building a good credit history.


Key points

  • Student credit cards are a good introduction to credit for students.
  • If you get a student credit card and pay the bill on time, it can help you build a high credit score.

The fall semester is starting again, so if you’re in college, it’s probably a busy time for you. Between moving into dorms or an apartment, enrolling in classes, and buying books, there’s a lot to do.

As you prepare for college life, there’s also a smart money move you can make right now. If you don’t have a student credit card yet, it’s worth getting one. By getting a student card and using it wisely, you can get a head start on building your credit score and maybe even get some extra perks in the process.

How Student Credit Cards Work

A student credit card is a type of credit card designed specifically for students. If you know how credit cards work, student cards work the same way.

When you get a student credit card, the card issuer approves you for a credit limit, also called a line of credit. This is the maximum balance you can have on the card. Student cards normally start with low limits, such as $500.

Each month, the card issuer sends you a credit card statement. Your credit card statement will contain:

  • Charges you made during this billing cycle
  • The statement balance, which is the total amount you owe
  • The minimum payment amount required
  • The payment due date

Here’s the key to using credit cards successfully — pay the full statement balance each month. When you pay in full, you pay no interest on your purchases. You only pay the actual cost of these purchases.

On the other hand, if you don’t pay in full, that’s when the card issuer may start charging interest. This basically means you pay extra for purchases you haven’t paid for. Some people only make minimum payments, but it takes a long time to pay off your balance and costs you a lot of interest.

LEARN MORE: How does credit card interest work?

Why should you get a student credit card?

The main reason to get a student credit card is that it can help you build your credit history. Your credit history is what determines your credit score, a number that will have a big impact on your life.

For example, when you apply to rent an apartment, chances are the landlord will do a credit check. If you don’t yet have a credit score, you may need to find a co-signer, such as a relative with a high credit score, for your lease. Or, the landlord might require a larger security deposit.

This is just one example among many others. Your credit score also comes into play when applying for loans, such as car loans and mortgages. In most states, it can even affect how much you pay for auto insurance.

If there is no information about your credit history, you will not have a credit score. It’s called being invisible credit, and it’s a problem for many people, especially young adults. No credit score means that lenders and other third parties have nothing to do when they check your credit.

But if you used a student credit card and paid on time, you won’t have this problem. Each time you pay your bill on time, the card issuer flags that payment in your credit history. Each is like a good grade, and over time, that positive activity adds up to a high credit score.

This is an important advantage, but it is far from the only advantage of a student credit card. Here are a few others you should know about:

  • A credit card is a safe way to pay for your purchases. Almost all credit cards offer zero fraud liability, meaning you are not responsible for fraudulent charges made with your card.
  • Some student credit cards offer rewards, such as cash back, on your purchases.
  • Many credit card companies offer free identity protection and credit monitoring to their cardholders. This allows you to stay on top of your credit score and credit file activity.

How to get a student credit card

The first step to getting a student credit card is finding the right one. If you have a bank account with a bank or credit union, check to see if they have student cards available. Some do, and it’s often easier to get approved for a credit card when you’re already a customer of the card issuer.

Otherwise, browse the best student credit cards and choose the one you like. Once you have found a card, you can apply for it online. Credit card applications ask for personal and financial information, including:

  • Full name
  • Date of Birth
  • Physical address
  • Phone number
  • E-mail address
  • Social Security number
  • Annual revenue

You will need some form of income to be approved for a credit card. However, it does not have to be employment income. If you receive scholarships or grants, or even an allowance from your parents, you can include this as income on your credit card application.

Credit cards have a mixed reputation in personal finance circles, and it’s true that bad credit habits can land you in debt. But when used responsibly, they are a useful financial tool. Your credit score is extremely important, so it makes sense to start working on it now.

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