Credit cards, mortgages, car loans, and other lines of credit affect your credit history and credit scores. Every time you obtain a credit card your credit score is going to fluctuate. If the account becomes delinquent you will show poorer credit scores than a person with accounts in good standing. Since your credit scores are used to assess your risk to a company it is imperative to keep your scores as high as possible. To help you understand your credit scores and why you need to access your free credit scores periodically, information has been provided below.
Free credit scores and your FICO score are two different things. Transunion, Equifax, and Experian all have a credit score that they create based on your free credit report. The information in your free credit reports will be given ratings. There are five categories used to devise the credit bureau credit scores. These three scores are then used to create your FICO score. The five categories the credit bureaus use are listed below. The percentage of how each category affects you has also been listed.
- Length of Credit History: 15 percent
- New Credit: 10 percent
- Types of Credit Used: 10 percent
- Debt: 30 percent
- Payment History: 35 percent
From this list you can see that the length of your credit history, new credit, and types of credit are going to minimally affect your credit score. They do matter to come up with the entire score, but the amount of debt and your payment history will matter a great deal more. Debt is the amount of credit you have including revolving debts. Credit cards fall under revolving debt, which is also unsecured debt. The more unsecured debt you have the more risk companies see.
Your payment history is more important than the amount of your debt. In fact your payment history will determine if you are considered where you are on the range of bad to excellent credit. A credit score is calculated between 300 and 850, with the worst credit being 300. If you fall below 600 on your credit score you are considered a high risk. 750 and above is ideally where you want to be on the credit score range.
Individuals with lower than 600 would have to apply for bad credit credit cards or prepaid cards, if they want a credit card. A person with a higher credit score will often get a better credit card and thus a better annual percentage rate. From this information you can extrapolate a conclusion about free credit scores and your FICO score.
The FICO score is created using the median of the three credit bureau free credit scores. This score is then used to determine if you should be awarded any line of credit including the credit card you are applying for. Furthermore, each line of credit you have will affect your free credit score. For those with bad credit, having a bad credit credit card can help increase the credit scores if the reports are good. This process is slow, but it is one way to repair credit if you need to.
A credit card can be a handy tool to have around in the event of an emergency. It can also be a tool to help build your credit history for later in life when mortgages and other loans may be needed. If you are a student then the Discover Student Card might interest you, but it is by no means the only student credit card available. You have the choice in choosing a card that will work for you, whether it is for your college expenses or for an emergency.
What you need to know about any credit card is that the companies report to the credit bureaus at least four times a year. Some companies will report each month, while others report each quarter. When the company reports your account is in good standing, they also show the balance on the card and the credit limit. If you keep the card balance below 50 percent of the credit limit, this will help your credit history and in turn your credit score.
Since the Discover student card is an option for students it is important to know what this credit card can offer you. The Discover card provides you with 5 percent cashback bonus on travel, home improvements items, department store purchases, gas, groceries, restaurants, and many other purchases. For students you will find cash back rewards for text books and other school supplies you need each year. At various times of the year there are deals for 5 to 20 percent Cashback Bonus. These specials are often awarded for online shopping at Discover’s exclusive store. Other purchases not named in the Cashback Bonus program can offer one percent unlimited rewards.
The student credit card from Discover also provides 0 percent APR for the first six months on purchases. Any purchase you make in the first six months will not have the APR you have been awarded. If you pay that balance off before the six months are up, you will never pay interest on it. In addition to the purchase promotion rate there is no annual fee, even for students.
Some student credit cards will only award the card for an annual fee. When you look at the promotional rate and no annual fee you are already saving money. To top off the better features of the card is a $0 fraud liability guarantee, meaning any fraudulent charges are not liable by you.
Discover offers a minimum annual percentage rate of 14.99 percent on their Discover student credit card. This rate is variable and can change at any time. Discover is one of the credit cards that is not usually willing to lower their interest rate below the first APR ever offered. What this means is your card will never be below the 14.99 percent, but if it is raised for any reason, you may try to get it reduced back to the 14.99 percent. This will only happen if your credit card is in good standing.
With the new credit card laws in effect, you may be looking for a new credit card. Before you apply for a credit card you will need to access your three free credit reports. By accessing your free credit reports you can examine what your creditors are reporting about you and what an inquiry might find. We will list some of the information you can find on your credit report and how it can affect you and your credit history.
- Addresses: the places you have lived in the last few years are often listed on the credit report. If you have not moved in the last three years, you may only see your current address. It also depends on when the credit report has refreshed their data about your addresses. This information is used to see if a person moves around a lot or has a steady life at one address. It does help assess risk.
- Bank accounts: your bank accounts may be listed on the credit reports. At the very least the report will have what banking institutions have made inquiries in the last year regarding you.
- Inquiries are one of the last things on a credit report, and show companies whether you have had numerous inquiries over a certain period of time and what those inquiries were. It can show whether you have applied for credit cards from multiple companies over the last month or two.
- The largest section of the credit report will look at your lines of credit.
Each line of credit you have ever had will be displayed on the free credit report, unless you have something removed. The lines of credit can be mortgages, car loans, student loans, credit cards, and any other form of credit. Under each line of credit will be the date the account was opened, for how much, and whether the account was paid in full, closed, and closed by whom. It will also show any delinquencies you may have had. Along the bottom of the information per each line of credit will be days or months listed showing whether you were on time, late, or missed a payment. The three free credit reports display information a little differently, so you may also see written conclusions about the card and a reason for that line of credit to be considered negative.
If you see nothing negative it means the reports are all positive, which is where you would like your credit to be when you apply for credit cards. Bankruptcies will also be displayed on the free credit reports, along with any charged off debts you might have.
Free credit reports are your financial history spelled out in a neat little report for companies and you to access. When you obtain your credit report you will see everything as the credit card company sees it. From this information you can decipher if a credit card company might be willing to give you a credit card.
If your credit card reflects a poor history you know that there are limited credit cards you can apply for, such as bad credit credit cards. As a student you may have little to no credit which affects the type of card you can apply for. The main point about free credit reports is that it is a tool for companies to decide if you are worthy of a line of credit and the risk you pose.
For you it is a method to check your financial history to see if it melds with your own conclusions. Identity theft is an enormous problem in the United States. If you fear you have been a victim of identity theft or credit card theft, your credit report can show any lines of credit that may be in your name. From this you can tell if there is any invalid line of credit, such as one you never opened and dispute the issue. Identity theft often means accounts are opened and the perpetrator allows these accounts to become delinquent. By checking your free credit reports you can ensure nothing untoward has happened, and that you get it cleared up quickly if something has occurred.
Choosing between credit cards is an arduous task, and what can make things worse is getting the wrong card. Shopping for credit cards takes time, patience, and some skill. It also takes knowing what that card can offer you, like the Orchard Bank Classic Cards.
Orchard Bank provides the MasterCard logo, which is the second largest logo in the world. Secondly, they offer a credit card you can build your credit history with. Orchard Bank Classic Cards is a group of cards for you to choose from. Some of these cards will be secured credit cards and others are bad credit credit cards. Bad credit credit cards mean you have let your credit scores fall. You’ve been labeled a risk, but you also have a way to get your perfect scores back through one of the Orchard Bank Classic Cards.
With the account you have the ability to access your online information 24/7, along with receiving emails and test messages when you require them. The difference between Orchard Bank Classic Cards and most other credit cards is our number three advantage of the card. Orchard Bank will report monthly to the credit bureaus to help raise your bad credit as quickly as possible.
Orchard Bank also has a different process for awarding the credit cards. They have a card selection process you go through before the application process. In other words, they pre-qualify you for the Classic Cards you would be best suited for. You do not have to take any of the secured credit cards being offered, but they do help narrow down your choices. It takes sixty seconds to find out which credit cards you pre-qualify for without affecting your credit score.
Once you decide on the right card out of the Classic Cards you can fill out the application, chose a card design, and wait for the results. The application will affect your credit score, as any running of your credit will, but this is done only after the pre-selection to see what card or cards might be awarded to you.
Secured credit cards are better than cash or checks in at least 5 ways:
- You can shop online, and buy gas when the stations are closed
- You can reserve a hotel room or an airline ticket over the phone
- You have recourse if goods are defective or never delivered
- If your credit card is lost or stolen, you’re protected
- Secured Credit Cards will help you build your credit rating
We all know that shopping on line can often save both time and money. Finding a specific product via a Google search is much more efficient than telephoning every store in your town, or driving from store to store. And often, the price including shipping is less than you’d pay in person.
And, while some on line stores do accept electronic checks, you usually have to wait until your check clears before your merchandise will be shipped.
If you do much traveling at night, you know how convenient it is to pull into a station that’s closed and use your credit card to fill up. You can’t do that with cash or a check.
Next, reservations: Unless you secure your spot with a credit card, you take the chance of not having a room or a seat when you need it.
Safety is another issue. Whether you buy on line, over the phone, or from a catalog, there’s always a chance that the company isn’t on the up-and-up. When you’ve paid for your purchase with a credit card, the credit card issuer will back you in your complaint – and credit the purchase back to you.
As for loss… If your credit card is stolen your liability will never be more than $50 – and some cards offer zero liability. All you have to do is call and notify your credit card issuer.
If your cash is stolen – it is simply gone. And if your checkbook is stolen and the checks used, you’ll have to jump through hoops to prove that you didn’t write those checks.
Last but not least, a secured credit card will help you build or rebuild your credit scores.
Just as with any other card, your usage will be reported to the credit bureaus each month – slowly improving your credit scores with each month of responsible use.
Treat your secured credit card with respect, and you’ll be rewarded with higher credit scores. So…
- Never charge more than 30 – 50% of your available credit
- Always pay your bill on time
The UPSIDE VISA® debt free prepaid card is a parent’s answer to controlling spending while making sure that teens have access to money when they need it. It’s the card that’s made to order for teens 13 and up – and for college students up to age 25.
With instant reload from a parent’s bank account or credit card, it’s the easy answer to getting funds to a child quickly should an unexpected expense arise.
And the best part is, you and your child can try this card for FREE!
The basic plan, which allows for a maximum balance of $1,000, comes with no activation fee, no monthly fee, and no fee for loading from a parent’s checking account. This plan does not allow ATM withdrawals, but is accepted anywhere Visa debit cards are accepted.
The Upside Access plan carries a monthly fee of $2.95, can carry a balance of up to $2,000, and does allow ATM withdrawals, both at home and abroad.
Upside Edge allows a balance of up to $5,000 and the annual fee of $29.95 will be refunded if cumulative loads reach $2,900. This plan also allows ATM access plus free direct deposit if the teen has a part-time job. In addition, if your child is 18 or over, Upside Edge offers an online check writing service.
All three plans credits points for the Sponsorship Program and UPside Mall purchases, and the Upside Edge also gives 1% cash back on funds loaded. Points can be saved, as they never expire.
All three plans also give parents real-time Internet access to their child’s transactions, so you and your child always know the current balance on the card.
Upside Access is far safer than cash, because lost cash is lost, but funds on a lost card are not. All you have to do is let us know the card has been lost or stolen. Then we’ll cancel your card number and issue a new one.
Yes. And no.
Disreputable credit repair agencies will tell you to dispute every negative entry on your credit report – even if it’s truthful. Their theory is that when you keep disputing these entries month after month after month, they’ll get tired of you and just drop them.
And perhaps it works for some people in some circumstances. But you’re sure wasting a lot of your time and energy when it would be easier and better for you to simply work on repairing your credit through legitimate means.
So, if the negatives are accurate and their time limit has not expired, the answer is no. Don’t dispute them.
But… there are entries that you should dispute, because they are errors. And in fact, some of them could be evidence that your identity has been stolen.
These include:
- Current accounts that are not yours – You haven’t opened an account at that department store, so why is an account showing up? Dispute it, and dig deeper to find out who did open it. You may need to report identity theft.
- A new employer – who happens to be someone you don’t even know. Again, this can be a symptom of identity theft.
- A change of address – when you haven’t moved. It could be a phony address that a thief is using temporarily.
- Listing of a spouse who isn’t yours. Someone who stole your identity may not know your spouse’s name – and has thus listed a different spouse on a credit application.
- Late payments, charge-offs, or collections that aren’t yours. This could be a sign of identity theft, or a data entry error.
- Closed accounts that list anything but “paid as agreed” if you always paid on time and had paid in full when the account was closed.
- Accounts listed as unpaid that were included and charged-off in a bankruptcy.
- Accounts listed as unpaid that were, in fact, paid in full. This is a bookkeeping or record keeping error and needs to be corrected!
- Negative items that have passed their “expiration date.” This is 7 years for most things, and 10 years for bankruptcy.
Some items are not worth disputing…
While it’s nice to keep everything accurate, some errors are not worth the time it takes to file a dispute. Among these are:
- Misspellings of your name – that’s a harmless data entry error
- Listing of an old address – that’s just out of date information
- An old employer listed as current – still no harm done
- Incorrect reporting of who closed an account – you or the bank. This one sounds like it might be important, but it isn’t. What’s important is that the entry shows that you were paying as agreed while the account was open and that you no longer owe a balance.
Do you find yourself paying late charges because you forget to pay a bill on time?
With direct deposit and automated bill pay, the Facecard prepaid MasterCard® will save you from that drain on your finances. And direct deposit means your money will be available for your use sooner.
You can also load your Facecard from your bank account or by transfer from a credit card or debit card. The maximum that may be loaded from a credit card is $500, and the maximum balance you may carry on your Facecard is $2,500.
The Facecard is just a little different from most pre-paid credit cards, because it is available to U.S. citizens 13 years of age and older – most cards require holders to be at least 18 years of age. You still do have to provide a Social Security number, full name, and address, in compliance with Federal Regulations.
As with many pre-paid credit cards, there is no monthly fee if you use your card regularly, but the Facecard minimums, like its age limit, are lower. To avoid the $3 monthly fee, you can load as little as $100 per month on your card or spend as little as $100 per month using your card. This makes the Facecard a great pre-paid card for teens whose parents might want to load their monthly allowance or emergency funds onto the card. Transfers from one Facecard to another are always quick and always free.
The Facecard also offers “Prewards” - digital incentives (like coupons) that are automatically added to your Facecard as soon as you click on “accept” after receiving an e-mail notice. . Merchants in our partner network send digital incentives to your Facecard for you to enjoy at their restaurant, store or place of business. Each Preward is for a specific business and is good for a set time limit.
The Facecard cannot be used for gambling or any illegal activities. The Teen Facecard cannot be used to purchase alcohol, tobacco, adult entertainment, firearms, or ammunition.
When you finish your schooling and set out into the working world, you’ll find yourself at some point in need of credit.
You may want to buy a car, rent an apartment, or just get a cell phone in your own name. And of course, before long you may want to buy a home. Not only that, good credit will help you land a good job and get lower insurance rates.
The best idea is to start while you’re still in school, but if you haven’t done that, start now.
The first step is to order your free online credit report, even if you’ve never established credit in your own name. That’s because identity theft is rampant, and there could be accounts in your name that you don’t know about. So first check to see where you stand.
If there are problems, start right away to correct them.
If there are no problems, the first step is to open a checking and a savings account. Keep good records so that you never overdraw your checking account, and strive to put 10% of your income into the savings account each month.
Next, slowly establish at least 3 lines of credit. Choose from major credit cards, gas credit cards, or a retail store line of credit. Make sure that if you choose a retail account that the store does report to the credit bureaus.
Before you apply, look at their requirements to be sure you qualify. You don’t want to be rejected on your first application!
If necessary, get a relative with excellent credit to co-sign, or get a secured credit card.
A secured card requires you to deposit money in a savings account as security for the line of credit. But since these cards report to the credit bureaus, your wise use will help you establish a good credit history. After you’ve established yourself with the company, you can ask to be switched to an unsecured account.
Once the first source of credit is established, wait a few months and apply for a second one. Again, first read the requirements and make sure you qualify.
Be careful to use less than 30% of your available credit, and always, always pay your bill on time.
Next get a small installment loan from a bank or credit union and make every payment on time. If you need a car, choose a good used model. The interest rate will be a little higher, but since the price tag will be far less than that of new car, your payments will still be smaller.
Instead of pushing your budget and giving yourself sleepless nights worrying over bills, spend less and put a portion into savings each month. A cushion of savings will give you freedom, and the ability to take advantages of opportunities later on.
So make your future bright: Establish good credit, restrain your spending habits, pay every bill on time, and save a little each month. Not only will you have fewer worries, but when you do need credit it will be easier to get and will cost you less.
The Horizon Gold Credit Card is a line of credit that can be used to shop exclusively at the Horizon online shopping website. There is no advance fee to establish credit and Horizon Card Services™ does not attempt or claim to attempt to establish or repair your credit history. Your application, however, will be reported to at least one major credit bureau.
This account is available to individuals 18 years of age and older who possess a valid U.S. credit card, debit card, checking or savings bank account. We will not check your credit, income, or employment prior to issuing your card. Prior bankruptcy will not prevent you from receiving the card. The one time fee for card issuance and account validation is $5.
Payments on your account will be automatically debited to the credit or bank account you designate upon application.
Your monthly payment will be 5% of your outstanding balance or $10, whichever is greater. The Annual Percentage Rate for Purchases is 0.00%. There are no penalties for prepayment.
When your account is activated, you will be automatically enrolled in the Horizon Monthly Membership/Benefits Plan. This membership includes a $500 unsecured card, plus access to My Privacy Protection, My Universal RX, My Roadside Protect and My Legal Assistance benefits. The $24.95 monthly fee for these membership benefits will be auto-debited monthly.
- My Privacy Protection gives you unlimited Internet access to view your own credit report.
- My Universal Rx offers unlimited access to local participating pharmacies, with up to 40% off covered prescription medications.
- My Roadside Protection will pay up to $50 / 15 miles for up to 3 service calls per year for fuel delivery, lock-out service, and flat tire changes. Note* This is not an accident vehicle recovery service.
- My Legal Assistance gives you Internet access to legal resources and one toll-free 30-minute consultation with a legal professional. Consultation does not cover criminal charges/issues.
