Having a hard time getting approved for a credit card? Have you done all you can to try and settle your bad credit on your credit report, but you still don’t meet the credit score requirements? There are solutions for you! One of the best ways to build credit. Is to apply for a partially or fully secured credit card. These credit building credit cards have lower standards because they require you to make an initial deposit of money to secure your credit line. This gives the bank or credit card company more security when lending you money. Lending Institutions However, if you still can not get approved for a secured credit card for bad credit. There is another option. You could apply for a sub-prime loan. These can be obtained from companies in your area. Some examples are: • Mariner Finance • OneMain Financial These companies also have lower standards for lending out money. Additionally, they can use alternative security to ensure they will not lose money by lending to you. There are multiple factors that these companies take into consideration when reviewing your credit application, such as: • How much money you are requesting. • What you intend to use the money for. • How much income you currently have. • How stable your income/job history is. • If you are a homeowner or renter. • If you have any assets that you own outright that can be used as collateral on the loan. • If you have someone willing to cosign with you to improve your overall combined credit score. All of these factors are considered when these companies are looking to extend you credit. Although this type of credit application may be more in depth, it is usually because they need to evaluate your history further as you obviously were not able to get approved with a regular credit card company or bank. In many cases, they will even approve you with a prior bankruptcy. As you have assets that can be used to secure the loan 100%. And a valid means to pay it back. This new credit line can be instrumental in getting a good credit score. Lending Companies vs. Credit Cards There is a difference between lending companies such as the ones mentioned above, and credit card companies. If approved, lending companies will issue you a check to cash or deposit. Then you must pay back that loan according to the terms and conditions in the loan paperwork that you signed. The payment will be a fixed payment every month. Additionally, some places will not allow you to pay off the loan early. That is called a prepayment penalty. The reason being is that when the loan goes full term, the company receives the most interest/profit from the loan. A credit card is a revolving door of credit. You can borrow against it, pay it back how you want, and continue to borrow. This is not the case with loans from a lending company. There is a minimum payment that must be met, but you do not need to make the same payment amount every month. It is suggested that you pay off the whole balance every month, to rebuild your credit. You don’t have to just live with bad credit, take action today to improve your credit score. - See more at: yourbadcreditcard.net/ways-to-build-credit/
Posted on: Thu, 01 Aug 2013 02:05:09 +0000
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