Help Bankruptcy Blog

Getting your own credit card is not as easy as you may think. Applying for a credit card account needs a lot of thinking.

Before marching down to your credit card agent, ask yourself some questions like do you want to pay for the credit every month or carry a balance instead? The type of credit line limit is also to be taken into consideration. Credit cards offer a lot of benefit packages, think of the package that would suit your needs.

If you want to carry on a balance, look for the credit card that offers the best interest rate or the annual fee offer. However, if you intend to pay for the credit every month, then look on the one that offers the lowest interest rate.

Credit limit determines how far you can go with your card. Think of the lowest limit that would fit your needs, not your lifestyle. Remember its supposed to be for necessity and not for luxury. Adding 30% to the limit you agreed on. This will maximize the value of the card. Meaning, you can use the card on a normal basis and still have enough value if an emergency arises.

Credit card companies offer tremendous bonuses on their cards. If you wanted to sign up for these packages, think, think, and think! Will they really be of help to you or are they just there to make your credit life miserable?

Of course the table is laden with different courses. You are only to get one so dont rush into one that looks good. You always have the liberty of comparing one credit card to another.

Always choose the credit card that offers the lowest annual percentage rate (APR). APRs could either be a fixed or a variable rate. Fixed rates do not change as the name implies but is higher. Variable rates changes depending on the economic trends. This is to be taken into consideration if youre deciding on carrying a balance.

Some credit cards offer a grace period of 25 days before they charge the interest on the purchase. But some may not have. Look for those that have one and the longer the grace period, the better the deal.

You also have to check on other fees attached to the credit card. These are the penalty rates as well as other charges like over the limit charges and late payment charges.

When choosing a card, always remember to get the one that would best fit your needs and at the same time the best deal you could get out of it.

Fixing A Credit History Left In Ruins

Everywhere you go, everywhere you look, it seems that a lot of things are fighting or the chance to grab our spending attention. Manufacturers are trying to outdo each other for the chance to get a piece of your earnings. Distributors are coming up with innovative packages and amazing discounts just to get a share of your income. And during those times when the temptation is simply too powerful to resist yet we have no money to spare? Thank God for credit cards, eh?

But one thing leads to another. There are bills to pay, lots of them in fact. And before we know it, were remiss in most of them. We resort to loans and offer our properties as securities. But times are hard and the aforementioned temptations are always present. We end up remiss with our loans as well, and we resort to new loans to pay off those which have become due and demandable.

The result? A credit history filled with red marks.

The Importance Of A Good Credit History

This shouldnt be the case. If there is ever a thing that could shape our destiny, then our credit history would be the prime candidate for such a role. Our credit history has far reaching effects (or consequences, if ever it is tarnished) in our daily lives, more than what is immediately visible. Lets take a look at the things that make a good credit history important for us:

* A good credit history would make it easier for us to acquire loans whenever we need cash to purchase a car, a house or other personal effects.

* A good credit history would also help peg the interest rate for such loans at a lower amount, which would make it easier for us to pay off.

* A lot of companies in this day and age refer to an applicants credit history to determine his financial responsibility. A good credit history will not only allow you to secure money when you need it, it could also help you land that dream job youve always wished for!

Fixing A Damaged Credit History

Our credit history suffers considerably every time we are delinquent with the payment of our bills and the satisfaction of the loans we have acquired. Sometimes, the damage is so grave that repairing the same is almost impossible. But nothing is impossible, dear friend, and no matter how much ruin has been wreaked on your credit history, it can still be salvaged.

The key? Patience.

You have to realize that you cant fix your credit history overnight. It would take a lot o commitment on your part, and it would take a lot of time. You must keep these in mind before you embark on that road back to financial health.

First, you have to come up with a realistic budget. Do not cut back on necessities, as this would just make you create a budget that you wont surely be able to keep. Make a budget plan that includes everything that you need, and your wants kept at the barest minimum possible. This way, your needs would be well covered, and you wont have to deviate from what you have set out to do.

Second, you must learn how to cut down on your spending. Easier said than done, I know, but if theres a will, there should always be a way. Your spending habit is not a pathological disease. It can be curtailed. You just have to try.

Third, when worse comes to worst and you find yourself needing some extra cash, try to secure a loan from your family and friends. These loans are personal in nature, and need not reflect on nor be determined by your credit history. Friends and family are there to support us. You might have to swallow some of your pride, but think of the bigger picture your life needs that credit history to get back on track.

Its not an easy road, by any means. But if you find yourself in such a situation, its the only road you could take. But like we said earlier, nothing is impossible, and you would only reach that destination paved with financial independence once you take the first step.

The quickest way to get rich, as many people say, is to be your own boss. Corporate employment, or slavery as many people do claim, would not bring you to the Promised Land fast. Youd have to prove yourself to the company for many years before they reward you with luxurious income that would allow you to save up an amount higher than what youll be compelled to spend. Being your own boss seems to be the way to go.

But being your own boss requires that you have your own business. This is easier said than done. For starters, you would need the capital to jumpstart your business venture. This amount is quite inaccessible for most of us. Another, having your own business is fraught with risks. You would have to be ready for any contingencies. Being struck with an unexpected risk early in the lie of your enterprise may prove disastrous, and your business might not be able to recover.

These perils of having your own business need to be attended to if we want to have a venture that would flourish instead of being stuck on the ground. Most of them are financial. Capital needs money. Risks can be secured with your cash at hand. The damage brought about by actualized dangers can be minimized if you could spend for the cure.

Enter Business Loans

Business loans are wonderful options for startup businessmen and established ones alike. Business loans would be able to provide you the money you need when you need it.

Most lending institutions have realized that at par with a persons need for occasional credit is a business equal need to acquire some cash to help its finances whenever it encounters some rough sailing. Responsively, they have started to offer business loan packages to answer for these needs.

Not every business can avail of a business loan, however.

Things To Know Before Applying For A Business Loan

Before you file your application for a business loan, please take note of the following things:

* Know if you are capable of paying off the business loan. The purpose of securing this kind of a loan is to make your business flourish and to help it hurdle some tough times. If, eventually, you wont be able to pay off such a loan, youd just find yourself in deeper trouble than when you started out.

* Know how much your business needs. If you could keep it at a minimum, do so. The lower the amount you would borrow, the lower the interests you would have to pay.

* The history of your business would play an integral role in the grant or rejection of your application. Your business years of existence are one of these considerations. Some lending companies would only deal with businesses that have 3 years of life tucked under their belts. There are other companies, though, that deal with all kinds of businesses.

* Your business should possess a good credit file. This includes your credit line and your current Paydex score. Your Paydex score represents how much you have satisfied previous credits. Some lending institutions require a Paydex score of 70% or higher.

* Banks, at the average, decline 92% of the business loan applications forwarded to them, so dont be disheartened if they refuse yours. There are always private lending institutions to resort to.

* If your business is a sole proprietorship or a partnership, expect the lending institutions to scrutinize your credit history. Businesses of this nature are considered as extensions of the business owners financial personality.

* You would have to place collateral to secure the business loan. Real estate is always preferred for this purpose.

* Interest rates would most certainly vary, so try to canvass for the best deal that would require you to pay an affordable interest rate. Do not jump on the first opportunity that is presented.

So, you have decided you need a credit card. However, you must remember that not all credit cards are created equally. Your friend’s credit card doesn’t mean that it is also the best for you. Before going to this bank and get its credit card, you must consider the several factors that you should take into consideration when deciding which credit card you want to get.

Some of those factors include:

o Interest rate. When you are the type of person that pays off your balance monthly, you would probably disregard the interest rate. Unfortunately, most people are having problems keeping with their credit card balance. Most people do carry a balance in their credit cards. If you sometimes late paying and carrying a balance, then it would be the best decision to have a credit card with a low interest rate. Having a card with a low interest rate save you a lot of money. You might disregard the difference between a 10 percent and 20 percent interest rate, but the difference could be significant if you have balances for a long period of time. Major credit card companies like Visa, MasterCard, Discover, and AMEX, have low interest versions of their credit card.

o Reward programs. Visa, MasterCard, Discover, or American Express and other major credit card companies have reward programs. Reward programs give you special privileges or services for being a credit card holder. Some of these programs include frequent flyer programs, where you are given one frequent flyer mile for each dollar spent. If you are quite a traveler, then a credit card with this program might be for you. Some offer cash-back options. Most common are discount offerings at retail stores or online chains.

o Annual fees. The annual fee is an important consideration, especially those who have a hard time paying off their balances monthly. If you think that the annual fee you have to pay to keep your card is way too high compared with the privileges you get from your card, it would be probably better to stop using the card.

o Member benefits. Credit cards promise various benefits. Some have travel protection as part of the benefits, while others offer roadside assistance. You have to consider your lifestyle in checking out a card’s benefits.

Remember: On choosing credit cards, choose wisely. If you need to, discuss your specific financial needs with your financial advisor.

A Primer On Declaring Bankruptcy

Dealing with the real world brings about another identity from us, that is, our financial selves. With how closely interwoven the real world is with economic matters, our financial self is usually made a gauge to reflect our worth as a person. Call it unfair and demeaning, but the fact is, people will not transact with us on a financial level if we have a less then stellar financial self to present.

That our financial selves would encounter some difficulties from time to time is a given. Sadly, most people seem to experience the worst end of these hardships, and they are left in ruins, unable to pay their bills and the other demands of their financial lives without sacrificing their daily needs for sustenance. These difficulties can be attributed to a lot o factors. Financial mismanagement, of course, is the primary culprit. Unexpected contingencies striking like thieves in the night can also cause our financial downfall.

These difficulties are made more unbearable when we have several loans to pay. Our incapacity to satisfy these loans can bring about more troubles of the legal kind, and worse, the surrender of certain properties we need for a good life.

Often, people situated as such would rather disappear from the world to escape from their many obligations. Fortunately, there is a legal way to do this, through the process popularly called as bankruptcy.

What Is Bankruptcy?

Declaring bankruptcy is a way to dissolve your existing debts. The way it goes is that you will have to file an application before the appropriate court. The court would decide if your petition is meritorious, that is, it satisfies the following requisites:

* The applicant is incapable of satisfying all of his debts when they become due.
* The applicant has filed the petition in good faith, meaning, it was not a deliberate attempt to evade his creditors and his liabilities.
* The applicant has exhausted all other available remedies and he has no recourse left but to apply for bankruptcy proceedings.

If the court declares you bankrupt, your assets would be delivered to a trustee. The trustee would be charged with the responsibility of assigning portions of this estate to your creditors, in proportion to the amount you owe them. Upon exhaustion of your assets, youd be free from all your existing debts. The result is a fresh start for your financial self.

Consequences Of Bankruptcy

What shouldnt be neglected, however, are the strict limitations that being declared as bankrupt would impose on your financial life. Your line of credit would be suspended, which means that you are barred from acquiring new loans. This may prove to be a problem if ever the need arises within the 2 year period (more in certain cases) of your credit suspension.

Also, your state of bankruptcy would be reflected on your credit report. Aside from future problems with creditors regarding your loan applications, this might be taken as a negative sign by employers who would review your credit history to determine your financial fitness.

If all of these consequences perfectly justify the dissolution of your current debts, then the first step in bankruptcy proceedings is to consult with a bankruptcy lawyer.

Two Types Of Bankruptcy

The most popular type of bankruptcy is what is called as Chapter 7 proceedings. This type incorporates the details we have discussed so far, most notably the liquidation of your assets to partially satisfy the claims of your creditors. The trustee would call on such creditors for what is called a 341 meeting, where your assets would be assigned in proportion to their respective claims. Any amount that your assets would fail to satisfy would be written off as losses for your creditors.

There are other types of bankruptcy proceedings, but instead of involving the dissolution of your loans, they involve the restructuring of your debts to fit a schedule that would be amenable to your financial capacity. The negative effects are less than those that result from Chapter 7 proceedings, but your debts wont go away.

What bankruptcy proceedings to pursue would depend on you. Try to consult with your bankruptcy attorney to get the right advice that would be most beneficial for your situation.