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  • Credit Freedom Experts

Updated: May 16, 2020


 
 

We all get credit card offers in the mail. When this happens, a lot of thoughts run through our mind. We wonder if should accept the offer, throw the offer away, or if we even need a new credit card. If you find yourself asking these questions, then you have come to the right place for some answers. There are major differences between most credit cards out there which includes not just their interest rates or credit limits.


So we start with a few different cards:


Store Credit Cards: Store cards are usually offered during your checkout at most large retail locations. Typically the cashier will offer a few nice perks if you agree to sign up for a credit card. However, they only work at that particular merchant location and possibly any other sister companies or subsidiaries. Some examples of merchants who offer these cards are your local gas stations, clothing stores, home improvement stores, and many more.


Store Co-branded Credit cards: These cards have the same features as store credit cards with the additional benefit of being able to using them almost anywhere due to the fact that they are linked with a payment network like Visa or MasterCard. The benefits of these cards are usually better. However, the approval process is also more stringent.


Whether it is a store credit card or a co-branded store credit card you will see a lot of different benefits from points to percentage off deals, cents off per gallon, cashback deals, and special offers on specific dates.


Secured Credit Cards: These starter cards are usually for people trying to establish credit or trying to rebuild their credit. Two examples would be Self or The Credit Builder Card, which we offer our clients as an option to help them rebuild their credit. The only difference between a secured credit card and a regular bank credit card is that you are securing the credit limit with your own money and not the bank's. The benefits are that an exceptional secured credit card reports to all 3 major credit bureaus and you have lower spending limits, which make it easy for you not to over spend. Once you cancel the account you receive your initial deposit back.


Bank Credit Cards: There are so a variety of bank issued credit card options. Having the best deal including interest rates, annual fees, and other benefits depends entirely on your credit score range and credit report. There are a small hand-full of credit cards that offer the best deals and benefits you can get, and then there is every other credit card that has a fancy name but very few benefits and higher fees or interest rates . You must read the literature that is available and compare different cards to decide whether or not you want to add an inquiry to your credit report.


The benefits most credit cards may offer:


Airline miles % Cashback on purchases

Cents off per gallon Warranties

0% interest rate for period of time Car insurance

No annual fees No introductory fee

Low interest rate for a period of time Low interest rate or 0% on balance transfers

Points from purchases


One thing most people have to remember is that just because your pre-approved, doesn't mean you are approved. When they decide to pre-approve you, they only do a soft pull on your credit report and not a hard pull, which can make or break you during the approval process.


A majority of credit cards or store credit cards have benefits and drawbacks. Some have a lot more benefits than others. If you're looking to apply for the best card, then you'll also need to have the best credit score, which is usually above 700+. That's right! There are some perks to having a very high credit score, which is why you should maintain your credit score and keep your credit utilization below 30%. We recommend, that if possible our clients should keep their utilization below 10% on all credit cards and never go over 30% on any credit card, even if other accounts may be at a zero balance. The best thing one can do is to pay it off every month and keep utilization low when the card is being used.


Your credit score will determine whether or not you get approved. Keep in mind that there are credit cards available for people in all credit score ranges and the choices are endless. That also means that bad predatory credit cards are offered to you all the time as well, and you need to know what you sign up for before you make a decision. Keep in mind opening a new credit card and closing the account quickly will reflect poorly on your credit report, so be sure you are comfortable with using your new card.


Credit Freedom recommends two different cards to our customers which can help clients build or rebuild their credit. Self has a great credit building card that is secured from your secured line of credit. This is considered a 2 for 1 deal, which you'll never really see anyone else offer. You pay a small fee up front depending on the plan chosen. Then, you make monthly payments which also depends on the plan chosen at sign up. The best part is, you get your money back at the end of the 12 month period if you choose to close the account (small fees are charged). We also offer The Credit Builder Card, which is a secured credit card that only requires a $200 deposit and no credit score approval. The best part is both options report to all 3 major credit bureaus. Positive revolving credit is a must for someone who is seeking to have a high credit score.


If you have any questions on building your credit score you can contact us today at 321-400-5260 or email info@creditfreedomexperts.com.


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  • Credit Freedom Experts

Updated: Feb 4, 2020


One of the many things our client’s come to us without is revolving credit accounts. Since most of our clients have had their credit cards charge off, they have no type of accounts with a line of credit under their names. This means they most likely have no credit cards, which believe it or not, does not help when it comes to boosting your scores.


The main thing we encourage these clients to do, is to add positive revolving accounts to their credit reports. These accounts, if kept under 30%, will positively impact their scores. Why? It is known and highly recommended that people should keep their overall utilization below 30% to show responsibility to creditors. Typically, low utilization rates help keep your score on the higher end – along with other facts of course. Nonetheless, credit card utilization, or revolving credit accounts, count for 30% of your overall score. This is a huge percentage of your overall score, which means that credit cards or revolving credit on your reports matter significantly.


Revolving credit gives borrowers a limit in their line of credit for spending. Think about your Capital One card, for example, which gave you a credit line of $10,000. These accounts have no fixed payment amounts and once paid off; the limits can be used all over again. The most known type of revolving credit are credit cards. Both secure and unsecured cards fall into the revolving credit category. It is important to remember that no matter the limit set on your card, you should never ever max it our or come close to it if you are trying to keep your scores relatively high. When our clients cannot qualify for a credit card due to their scores and negative reports, we always recommend that they seek a secured card or that they sign up to the programs we are affiliated with. Once signed up to our recommended programs, or once they have sought out a secured card of their choice, their accounts report to the credit bureaus, thus adding revolving credit to their reports. However, clients must pay on time, every month, in order to see a positive outcome from these accounts. Carrying high balances brings your scores down, as well as not paying them on time. Our end goal is to have positive revolving credit, which in turns results in positive, high-end scores.


Contact Credit Freedom Experts today if you have any further questions about your credit.

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  • Credit Freedom Experts

Updated: Mar 8, 2020



Credit Score


Credit scores can be anywhere from 300-850 on the FICO scoring model which is the most commonly used model to evaluate your overall credit history. Lenders look at your credit score for certain patterns of behavior that are good or bad.


Common terms you may have previously heard include: super prime, prime, and subprime borrowers. Each category has the potential to affect your interest rates which will in turn affect your monthly payment by hundreds of dollars to thousands of dollars or more per month. Not knowing what category you fall into can hurt you financially and make most lenders see you as a more risky borrower.


FICO and Vantage Score Prime vs Subprime graph

Auto loans

When it comes to auto loans according to Experian, borrowers with credit scores of 660 or less, had an average loan interest rate in 3rd quarter 2018 ranged from 7.52% to 14.41% for new vehicles, and 10.34% to 18.98% for used cars. You may end up paying $60 or more per month on a subprime loan than a prime loan when comparing interest rates between the two.


Home Loans

Also, home mortgage loan interest rates are not as high as auto loan interest rates. However 1% can cost you up to $200 a month extra on the average home loan. Your score shouldn't be taken lightly and you should do everything you can to raise your score. Becoming a prime borrower is where most people usually want to be to get some of the most favorable interest rates when shopping around for a new home.


Credit Freedom Experts

Helping our clients fix their credit is what we are here to do. We also go over your credit history with you and walk you through the process to raise your score. We go over all your bad habits and credit history, and then provide the tools to create new positive credit building habits that will save you money and fulfill some of your financial goals.


If you need any help our experts are here to help you. contact us at 321-400-5260, or sign up for a FREE Credit Report Consultation.

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