Tips to help college students build their credit reports and continue their education.
Posts tagged good credit card
Can My Student Loans Be Really Discharged when I Declare Bankruptcy?
Apr 6th
A lot of people think that bankruptcy can completely solve all their credit problems. After all by filing for bankruptcy, you can easily discharge your debts, and start all over again.
But sadly, this is a misconception. Not everyone can take student loan bankruptcy to retire their debts. The bankruptcy policy reforms impose more stringent criteria on who can be eligible to discharge credit on student loans.
Filing for bankruptcy also takes much time. You need to attend several proceedings in bankruptcy court just to prove that indeed you cannot repay your student loan debt. And this is not a very easy thing to do. Why? Because most courts are becoming more and more reluctant in approving student loans bankruptcy.
To finally clear out wrong notions, allow us to explain the real, hard facts associated with student loan bankruptcy.
Facts about Student Loans Bankruptcy
An individual can only be eligible to discharge student loan debt if the applicant can prove that he/she experiences undue hardship. What does this mean? You can take student loans bankruptcy if you can prove that you belong to any of these criteria:
- you are physically unable to work;
- you have made a conscious effort to repay your debt but it prevented you and your family from maintaining a minimal standard of living
- there is a very small chance for you to find employment within the duration of your loan
Yes, there is a possibility to discharge your student loan debts. That is if you can effectively prove that you are either physically handicapped or that the chances for gainful employment in the future are non-existent.
If you would like to push through with this decision, you will be prompted to file a separate motion in a bankruptcy court. You will be required to prove your hardship before a judge and convince him to approve your claim.
By looking at these criteria and processes, you may now realize that it is extremely tough to get student loan bankruptcy. But there are other ways to eliminate your student loan debts. How?
Options you can Take
- Get a student loan consolidation. Student loan debt consolidation is one of the best ways for a graduate to gradually eliminate bad credit. In this program, the student loan debts and other bills or loan repayments will be consolidated or merged into a single amount. Then, you will need to propose a repayment plan to settle your debts. You will inform your creditors about your debt repayment schedule which can take at most five years to completely retire.
But there are also vital requirements in consolidating student loans. You need to have a stable source of income which can provide you disposable funds. You must also meet the minimum credit requirements for both secured and unsecured debts. But still, through a student loan consolidation, you will be able to gradually reduce your outstanding financial obligation. In the end you can be declared totally free from any forms of debt.
- Consider other credit management options. Some people use student loan forgiveness programs. In this program, you will be required to perform a voluntary service to the community for a specified number of hours. You may also be encouraged to join the military so you can totally eliminate your debts. Other options include forbearance and deferment during tough times, income-contingent repayment plans and other credit busting methods.
We hope that through the things mentioned in this article you can now answer this question: can my student loans really be discharged when I declare bankruptcy?
(No Ratings Yet)Credit Card Terminologies for First Time Cardholders
Mar 19th
Now that you’re ready to apply for your first credit card, you need to spend time considering your choices. One crucial step in searching for the right student credit cards is to read the fine print. But since this will be your first credit card, you may find that some of the terms are quite vague.
First Credit Card Terminologies
This article presents some of the basic credit card terminologies that you need to understand before signing up your application. Familiarizing yourself with these terms can help you in determining which credit card would be your best choice:
Annual Percentage Rate. The APR is the rate of interest applied to your charges expressed in an annual percentage. For example, if your credit card APR is 15%, divide into 12 months and you get 1.25%. That means, an additional 1.25% will be added to your monthly balance if you cannot pay it in full on or before your due date of payment.
Interestingly, some credit card companies impose three kinds of APRs: the first APR applies to new purchases; the second, to balance transfers; and the third APR for cash advances. Make sure that you are clear about the exact rate applicable to each transaction.
Variable Rate. If the interest rate is a Variable or Adjustable one, your current APR can change or increase depending on the Prime Rate. Presently, the New Law does not impose a cap limit on Variable Rates so your initial low APR can still double or triple, depending on your Issuer.
Annual Fee. This is the fee that you must submit on a yearly basis to keep your account active. Some credit cards carry no annual fees but secured credit cards usually do since these cards are especially offered to people with no credit or bad credit history.
Credit limit. The credit limit or credit line defines the maximum amount of charges a cardholder can charge to his/her credit card. The size of the credit limit and the usage can significantly affect a person’s credit score. Ideally, cardholders must keep their credit limit usage minimal (no more than 30% – 40% of available credit) to get a high score.
Due Date. This is the date that you are expected to submit your payment. Failing to submit your payment on your due date means paying late penalty and interest rate charges. Remember that late fees can badly pull down your final credit score.
Balance Transfer. These are charges from another credit card that have been transferred over. Some cardholders may choose to transfer balances to enjoy the lower interest rate or 0% APR that the other credit card offers.
Cash Advance. When you use your credit card to borrow or withdraw cash from an ATM, it is called a cash advance transaction. Keep in mind that cash advance transactions have no grace period so you automatically incur the cash advance APR the moment you make the withdrawal. Aside from the APR, you may also be charged with the cash advance transaction fee.
(No Ratings Yet)Credit Card Advice for First Time Cardholders
Mar 16th
Whether you are a student or not, if this is your first time to handle a credit card, this post was written just for you. Read on the rest of the post to know the available options you have when applying for your first credit card and learn tips on how to use your card for building good credit.
Student Credit Cards for First Time Cardholders
If you are a student, then you can either apply for a student credit card or a secured credit card. It is interesting to note that the New Credit Card Law restricts students who are below 21 years old from getting student credit cards unless they have a co-signer or they can show proof of independent income.
Meanwhile, a secured credit card requires a security deposit so be prepared to submit an upfront payment when you apply. The security deposit may range from a minimum of $200 and above, depending on the credit limit you wish to get. For students, it is best to start with the minimum required deposit as a lower borrowing limit will encourage them to exercise more control over their spending.
Another option is to get a department store card or a gas card. However, most merchants who Issue these cards are more stringent in reporting late payments to the credit bureaus. Also, these cards can be used for payment at selected shops only which can be a great inconvenience.
What about prepaid debit cards? There are debit card issuers that now offer credit reporting but you need to watch out the fees! Although you will not be charged with APR, some debit cards may come with too many fees which can really be a burden. If you do not pick the right one, you may end up paying for more than you bargained for.
Use Your First Credit Card for Building Credit
See to it that your chosen credit card will report your payments to the major credit bureaus. Remember, your primary goal for getting a credit card for students is to build-up your personal credit history. Therefore, it is crucial for you to maintain an impressive performance as a cardholder.
It is not about how much you charge to your credit card each month. What matters most is how consistent you are in paying off your charges. Submitting your payments on time is the key to keeping your credit history in good standing.
Don’t bother to carry over a balance in your credit card from month to month as it will not have a bearing in your credit rating. Paying off your monthly balance in full each month is more likely to impress potential lenders than leaving unpaid charges in your account.
Before signing up for your first credit card, spend time and effort studying the Terms and Conditions of your chosen Issuer. Bear in mind that the only way you can compare credit cards accurately is by checking the fine print. Making the wrong choice today could bring about problems later on so be diligent with your search.
(No Ratings Yet)How to Get Out of Student Credit Card Debt
Mar 4th
When used responsibly, student credit cards can be great tools for building solid foundation of credit history. A study conducted by Nellie Mae, a reputed student loan center, reveals that college students graduate with an average of $2,700 to as much $7,000 worth of credit card debt.
If you are presently stuck with credit card debt, don’t panic. Consider the following strategies to eliminate your debts one step at a time.
Strategies to Eliminate Debt on Credit Card for Students
1. Take charge. Even if your credit card debt seems insurmountable, it’s never too late to recover. Take positive action right now and build up your motivation.
2. Know your debts. Before trying to figure out a solution, you need to be aware about the exact status of your debts. Review your billing statements. Order a copy of your credit report so you can check all the accounts you have.
Make sure that there are no unfamiliar charges in each of your accounts. If there are errors, call your Issuer right away to correct the matter. If your creditor refuses to act upon your complaint, send a dispute letter to the credit bureau that issued your report. An investigation will take place within 30 days. Afterwards, you will be notified about the result of the investigation along with an updated copy of your report.
3. Create a doable repayment plan. It is important to create a written plan that you can use as a guide towards debt recovery. Do your best to follow the plan no matter how difficult or inconvenient it may seem.
4. Transfer high rate debt. One way to ease your burden is to get a credit card for students with a low or zero balance transfer rate. Transfer all your outstanding balances from your high rate card. This way, you can pay off your debts without the additional interest rate charge.
Choose a zero rate balance transfer credit card with a sufficient introductory period and reasonable fees. Remember, you’ll need to complete your payments while the zero interest is still applicable. Carefully read the fine print to make sure that the Terms and Conditions are fair.
5. Stop spending. You will surely have a difficult time paying off your debts if you continue using your credit cards for students on new purchases. This is not the time to splurge. If you need to use your card to keep your account from closing out, use it only for a small purchase and pay it back the same day you made the purchase.
6. Cut costs. Find ways to cut back on your monthly bills and personal expenses. For instance, you may consider giving up some subscriptions or switch to a lower plan of cable, internet, etc. Every cent you save, you can put aside to pay off your debts.
7. Seek professional help. Don’t be afraid to seek help from a trusted credit counselling agency. A credit counsellor should be able to give you advice on how to manage your finances more effectively.
(No Ratings Yet)Student Credit Cards: First Step To Becoming Financially Responsible
Feb 25th
Work At Home Job Opportunities For You
Most parents are hesitant to provide or allow their teens to have their own credit cards. They are afraid that this freedom will just lead to a more serious problem – bad debt. However, it is important to note that allowing our children to have a first-hand experience on managing finances is better that just telling them about it.
Importance of Having a Credit Card for Students
Getting student credit cards for your teens is a great start for them to build their own credit while in high school or college. Remember, credit history is important when applying for a job or loan. Good credit can impress a potential lender or employer. At young age, teens can learn basic finance skills that they can use in the future.
A credit card is convenient for college students since they won’t have to ask for cash from their parents each time they need to pay for something or buy materials for their projects.
College students who are working during summer breaks, on the other hand, can use their student credit cards to pay their tuition fees or purchase items. They simply charge it to their credit cards and pay them off with their own earnings from their part time jobs.
Tips On How To Teach Your Child About Credit
- Be sure to keep the credit limit to $250 0r $500. Students with part-time jobs might ask you to let them for a higher credit limit since they are already working but make them understand that they should just stick to that credit limit to avoid spending too much on purchases.
- Make your child understand that they can use the card for personal expenses but they must pay these bills from their own allowances.
- Teach them the importance of budgeting and expense tracking.
- Set rules on how they should use their student credit card. Make them understand the difference between what they need and what they want.
- Explain how a student credit card works – its fees, interest, grace period, etc.
- Let them know the importance of paying off their credit card balance on time.
How To Find The Best Student Credit Card For Your Teens
- Check if the student credit card has no annual fee.
- Find a credit card for students that has 0% Intro period.
- Check if it offers rewards programs that are just right for your children.
It is important to let your children understand the dangers of having too much credit. Some of the most common results of being incorrect credit card use are, debt accumulation, bad credit history and debt problems.
(No Ratings Yet)What You Should Know About Student Credit Cards
Aug 14th
If you’re planning to get a college credit card, this article was written for you. Owning a student credit card can be an advantage but the risk of falling into the debt trap makes some people skeptical about letting students have their own credit cards. In this article, we will discuss important points that you should know about credit cards for students:
Points that you should know about Credit Cards for Students
Getting to Know Your Student Credit Card
Student credit cards often require a co-signer. Some issuers of student credit cards still require a co-signer to ensure that the student will not default his/her debts. Your parents may volunteer to be your co-signer but keep in mind that repayment is still your personal responsibility. If you’re going to ask someone to cosign for you, it’s important to make sure that your cosigner enjoys an excellent credit rating. More >
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