In Debt? Surefire Tips to Paying Off Credit Cards

paying off credit cardCredit cards are a great way to buy products and services but they can cause some real financial trouble if you fail to consistently make payments on time. Given the high interest rates that are applicable on late payments, credit card debt can pile on quickly which makes paying off a credit card increasingly difficult over time. However, people who are smart with their finances know that they can do away with their credit card woes.  Here are some debt management tricks and tips to help you pay off your credit card bills quickly.

Cut Costs Now

If your debt is piling up, the best thing to do is leave your credit cards at home whenever you go shopping. Make sure to eliminate all unnecessary expenditures. Maintain a record of how much you spend and where you spend it including the smallest of transactions. Have only one card and make it your “for emergencies only” card.

Snowflake Payment

Making a “snowflake” payment means paying small bits of money to your credit card in addition to your required monthly payment. Some call this “found” money. First you’ll need to check with your bank to ask whether or not they permit you to pay these mini-installments. If they do, there are a lot of things you can do to help find money. Maybe you’ll receive a refund from an insurance claim. You might pet-sit or house-sit, mow lawns or clean swimming pools. And with the help of the Internet there is always the option of selling things on Craigslist, E-bay, Etsy and Amazon.

Use the Debt Snowball

An example of the “debt snowball strategy” would be for you to pay $100 on the first card and $50 on the second card. It may take some time but eventually you will have paid off the first card and then can begin paying $150 on the second card. You may be pleasantly surprised to notice how quickly you will clear your credit card debt.

Borrow from Friends or Family

Taking a loan from a bank establishes a time limit in which it needs to be repaid to avoid penalty charges. Borrowing money from your family and friends to pay off your credit cards can be a less stressful option because the time limit for repayment won’t be as stringent. However, this does not mean that you don’t need to pay them back in a timely manner or that you don’t need to pay a minimum interest even if they do not ask. It’s also very important to let them know how much they are appreciated for helping you through a bad time.

Stop Spending

It’s imperative to understand the value of money before you start handling it because it makes no sense to work hard to pay off debts if you continue spending excessively. You must work on reducing your expenses and try to save money for your future assets. Also, if you continue to spend money blindly, you may very well find yourself in bankruptcy.

Once you approach your credit card debt with these strategies you will begin to see it waning away. Make it a rule to spend within your means and to save a set amount each month. Remember your expenses should be income minus savings and not the other way round. All the best with your finances!

For more debt management tips, check this video: https://www.youtube.com/watch?v=JRpY9pBCQ5A&feature=youtu.be 

Improving Your Credit Score Surefire Tips

improving credit scoreThe U.S. Department of Veterans Affairs ensured home mortgage program assists veterans and active service service members obtain houses at economical rates. In general, the VA loan program is more lax than standard loans, but the process does need a minimum credit rating. Not everyone has a perfect credit score, and you might have to take steps to enhance your credit history before looking for a VA home mortgage. Read on to learn about the tips on improving credit score. 

Why Credit Scores Are Important

Credit rating show past patterns of repayment on various kinds of insolvency you have had in the past, and typically concentrate their concentrate on the past 2 years. Businesses report the patterns of their customers’ payment to companies such as Equifax, Experian and TransUnion. The ratings from these three credit reporting agencies are all a little different. The greatest and least expensive scores are thrown out, and the middle score becomes the one made use of for loan application evaluation. The computation of your credit rating is made by using an algorithm that was developed by the Fair Isaac Corporation, which is generally reduced to the term “FICO score.”.

Does the VA Home Loan Program Have A Minimum Credit Score?

The VA ensured home loan program does not require a minimum credit score to qualify for a loan, lenders who offer VA house loans generally have a minimum credit score that is required for approval of an application. These minimum scores are usually set at 620 or 640, depending on the loan provider. If your middle credit rating from the above reporting firms comes in lower than this number, you must take active steps to improve your credit record.

Improving Your Credit Score.

You can help raise your credit rating to supply a more beneficial payment outlook for a loan by carrying out these procedures:.

  • Review your credit record for mistakes– Your credit record may include old or inaccurate details that is influencing your credit report currently. Have the information remedied so that it no longer reduces your score. You will need to supply supporting info about the payment of any indebtedness that is incorrectly reviewed your credit record.
  • Pay off a bad loan– If you have a credit blot on your record, find a method to pay it off instantly, and ensure it is reported to the credit score firm. This action will assist to enhance a bad credit rating.
  • Stop making late payments– This procedure is among the simplest ways to raise your credit rating. Make certain vital payments are made on time as soon as possible, and remain to pay them on time to keep your record clean.
  • Pay down existing balances– If you have a charge card with a $10,000 limit and you have actually made use of $5,000, utilizing this much of the limit will hurt your credit record. Pay the balance to 30 percent to improve your record and prevent making use of the card.
  • Take a tough take a look at how you use credit– Do a comprehensive assessment of how typically you rely on your credit cards, and re-work your finances to utilize credit less regularly. You may have to downsize your desires, hobbies and vacation arranges to cut back your use of credit. However, this step will assist to enhance your credit rating in the near and far future.