Posts Tagged ‘Cards’
Secured Credit Cards After Bankruptcy
June 1st, 2010 | 
Author: If you have just been cleared from bankruptcy and you wish to continue acquiring assets, services and other goods on credit, you will need to avoid the pitfalls that led you into bankruptcy in the first place. You should start with credit cards that are secured against default.
Note that there are secured and unsecured credit cards. If your memory serves you right, you will remember that secured credit cards were never discharged from your list of debts when you filed for insolvency. Such secured creditors will come after you and they may even take away your possessions to cover up for the debts.
Unsecured credit cards are the best because if you happen to go into bankruptcy again, they may be among the debts that might just have to be forgiven. Note that this is not a guarantee though. On the other hand, some of the unsecured credit cards have their own way of ripping you off your earnings.
Credit cards for people with bankruptcy have charges on them that you have to pay to enjoy the credit services. For example there are those for which you have to pay monthly ledger fees. As much as the amount may seem small when calculated for the month, at the end of the year you will find that you are paying so much unnecessary money in those bills. On other cards you will be charged interest, participation fees and a range of other fees. Tread carefully lest you find yourself insolvent again.
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Wooing Small Business With Business Credit Cards
A few weeks ago (April 18, 2007), Discover Financial Services launched a new business credit card that offers frequent flier miles to small business owners. Among the credit card brands, Discover was one of the last to start offering business credit cards to the small business sector. Reportedly, this is only the latest in a virtual avalanche of business credit cards designed for small business.
One cannot but wonder at the sudden interest.
Perhaps a glance at recent research material will offer some clues. Data shows that in 2006, the small business sector spent $4.9 trillion; but only one-twentieth (5%) of that money was paid through business credit cards in any form (credit or debit card). The credit card companies now want in on that huge market, and believe they can induce small business owners to not only make use of their business credit cards but also to spend more on their cards.
To achieve this, the credit card companies will have to convince the small business owners to use business credit cards in less traditional ways. Traditionally, business credit cards have largely been used to cover travel and entertainment expenses. What card companies want is for businesses to use their business credit cards for everyday spend.
This is the reason behind the new cash back rewards business credit cards. These cards offer 5% discounts on purchases of office supplies, gasoline, courier services and other essential business needs. MasterCard even went as far as launching a business credit card targeted at a specific industry: contractors and construction companies. MasterCard was also the first card company to provide zero-liability protection to small business credit card holders.
Discover’s recently launched business credit cards offer small business the chance to purchase checkbooks. This enables small business owners to pay for purchases from vendors that don’t accept business credit cards. These checkbooks tap into the spending limit on their Discover business credit cards. Visa offers a directly competing program.
American Express sponsors various networking events for small business credit card holders. It also features one of the most extensive business resource databases to help users of its business credit cards to address and resolve their everyday business management problems and concerns.
How big is the potential market for business credit cards, you may ask? If you take the $4.9 trillion small business spending in 2006 and double the current business credit card spend from 5% ($245 billion) to 10%, you have $490 billion. If you charge 15% interest on that, you have a $74 billion potential contribution to profits. In fact, market research companies forecast double-digit growth in small business credit cards between now and 2010, and total charges are projected to reach $740.2 billion by that year. That is a lot of profit.
It has been an uphill climb to get small business owners to subscribe to an expanded use of business credit cards. It takes time, but eventually business owners will respond. One issue that business credit card issuers will have to address is the marked preference of small businesses to pay their full balance for the month as and when it falls due. Card companies do not earn from such transactions. That should be food enough for thought.
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Bad Credit Cards – 17 Functions And Features
A Bad Credit Card refers to the credit card obtained by those having bad credit rating.
Here are important functions as well as features of this card:
1. Cards of bad credit card are a direct & simple opportunity for the people who have landed up earning bad credit rating due to the non-payments of the credit to the credit card supplier.
2. It is also known as the rescuer for the ones having bad credit rating.
3. While it serves more of the functions of a debit card it is also known as a the debit card sometimes.
4. It provides the necessary training ground to the people in order learn to control their spending urge.
5. In technical terms they are also known as the secured credit cards.
6. In this system, the credit card suppliers issue you a card for bad credit card against an account that you need to open in their bank.
7. The deal is simple. The credit card suppliers earn money against the interst you pay to them, but if they keep helping the defaulters and flowing their profits how do they survive? So, they work in a secured manner with these secured credit cards or the card for bad credit cards.
8. The user is required to maintain some minimum balance in the account by all means.
9. The bank has to pay some interest ion the money that is maintained in the account.
10. The user is allowed credit up to some percentage of the amount deposited in the bank account.
11. The credit card limit can therefore range from 50 – 100% of the cash balance of the account.
12. While choosing among the various cards for bad credit cards available in the market, you must look for 4 obvious features.
13. First is the minimum balance required to be maintained in your bank account; this should be as less as possible.
14. Secondly, the credit limit the supplier is allowing against the cash in the account; this should range from 90 – 100%.
15. Next, there must be no other charges or fees applicable in the procurement of the card of bad credit card.
16. Last but certainly not the least is that the interest you earn on the cash balance of the account must be as high as possible.
17. The card for bad credit cards is a concept to respite the people going through bad credit ratings and letting them enjoy some benefits of the credit cards, alongside amending their credit rating.
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Rebuilding Your Credit With Secured Credit Cards
There are millions of people suffering from bad or damaged credit. As such, these folk have an impossible task obtaining credit cards.
Try to rent something? You might as well go home. Go to your friendly dentist? Without a credit card, your tooth is going to ache for a long, long while. Did your car break down yesterday? Chances are even the friendly tow truck will not get you to safe haven without a valid credit card.
In so many words, a valid credit card is not a luxury anymore. It is a necessity. A secured credit card may be a good solution for any person looking for credit repair, as long as he or she understands their options. Properly used, secured credit cards can actually restore a person’s credit rating and get him/her back on the right track in financial life.
Secured credit cards work closely with the bank. They have the same look and feel as unsecured credit cards with just a few differences. Instead of the creditor offering the banking customer a line of credit, the bank identifies its own credit line with the customer’s checking or savings account. Depending on the credit card being issued, the customer’s bank account will likely be used as collateral. If the customer fails to make a timely payment to the credit card, the minimum amount will be deducted directly from the customer’s bank account.
If the customer has bad credit for any reason, banks and creditors are unwilling to extend credit. This can make it difficult, especially in a society that is completely tied to credit. However, if a customer gets a secured credit card, he or she will be proving himself creditworthy, provided the bills are paid on time. Eventually, the bank or creditors may see the customer has proven himself again and will begin to offer extended credit.
The customer does not have to worry about debt with
these types of credit cards. The only credit line
available is what the customer has put into the special savings account. Keeping it paid will ensure that this credit line is always where it should be, at a comfortable range for the budget.
There are some disadvantages to using secured credit cards. If the customer fails to make timely payments, he or she will have to deal with their high rates of interest and other various late fees. These penalties can continue to rise to where eventually the customer will be broke and will have nothing to fall back upon. This is why it is ultimately important for the customer to keep that bill paid on time, every time.
However, this is still the best option for those who are looking to repair and rebuild their credit. Secured credit cards are the first step to financial freedom and eventually a creditworthy life.
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Prepaid Credit Cards for Teenagers
Have you been wondering how you can teach your teen to behave responsibly when using a credit card? No parent wants to see their child get into financial difficulty running up debts that they cannot afford to pay off, yet many of us know from experience how easy it is to succumb to the temptation of thinking that we can afford to buy now and pay later. Of course we learn through bitter experience that this is not always the case and we don’t want our children to make the same mistake.
One way of helping them learn to manage their finances is to give them a prepaid credit card. Technically of course, this is a debit not a credit card as the card is pre-loaded with cash.
There are a number of reasons why you may decide to get your teen a prepaid card. It may be that you simply want them to learn how to manage their own money and by topping up their card on a monthly basis they will hopefully learn how to budget. Your teenager may be going to university and you want to be sure that they have sufficient funds when they need it, for example a quick phone call to you means that you can top up the card in an emergency . Or your teen may be off on a gap year and you can rest easy knowing that funds will reach him quickly if needed.
There are several advantages to a prepaid credit card.
There are no credit tests needed to obtain one, anybody can apply.
It is impossible to run into debt, only the amount credited to the card can be spent.
If the card is stolen only the outstanding cash on it could be lost, although most cards can be blocked in these circumstances.
The disadvantages are minor, normally there is an application fee when getting a card.
Many cards charge a monthly fee, but this is could be cheaper than a teenager running up interest charges on an ordinary card!
Most cards allow withdrawals from an ATM machine, but charge a fee. These charges vary from company to company and it is worth shopping around to find the best buy to suit your circumstances.
There are a lot of cards now being offered and you should read all the terms and conditions carefully to ensure that you are getting what you require. Check there is no delay in being able to use the card as soon as it has been topped up, that you can withdraw from an ATM machine or use online. Well known names offering a Mastercard will probably cover all your needs. Be careful that you are not buying a non-reloadable gift card.
If you choose carefully and explain to your child that the money you will be depositing
on the card is to cover a certain period of time and they must try to budget, hopefully they will begin to learn how to do just that!
This article is for information and the author accepts no liability for any action taken.
