There are various quantitative and qualitative ways to determine if you have bad credit—the easiest and most definitive of which is if you have a FICO score of less than 620. According to a recent study by FICO, the leading credit score provider, at least 43.4 million people could be classified as having “bad” credit following this recession. Realizing that you are not alone in having bad credit (though it may feel like it) is the first step, but you must also acknowledge that there are no quick fixes to this situation. Credit can only be improved through consistent responsible activity, so be wary of offers that promise miracles.

A history of bad credit can make a consumer feel as if he or she is drowning. Like a swimmer who sinks beneath the ocean’s surface and makes strong, consistent strokes to bring his or her head above water, a consumer needs to consistently add positive information to a credit report in order to mitigate past negatives and improve his or her credit score.

If you’re in the market for a credit card and have bad credit, you should consider the reason you need a credit card before making your selection. Options for bad credit credit cards have improved since the new credit card law (CARD Act) became fully effective on August 22nd, 2010, but the fees for unsecured credit cards (what most people would consider regular credit cards) remain high.

If the reason you need a credit card is simply to rebuild your credit, a secured credit card is your least expensive option to do so. A secured credit card works just like a regular credit card with one major difference: a secured credit card requires a fully refundable security deposit and your credit limit matches the amount of the deposit that you put down. The minimum deposit is $200.

When shopping overseas, a merchant may ask you if you would like to convert your credit card transaction from the local currency into U.S. dollars. This is called Dynamic Currency Conversion (DCC), and while it may sound like an enticing offer, this conversion is very expensive for the cardholder and should be avoided.

Generally, when an overseas merchant makes this offer, they will use a conversion rate that is far higher than the actual going rate, as high as 7 percent, and pocket the difference as a fee. They get away with it because many customers are not checking the math at point of sale to make sure the conversion was accurate.

When choosing a credit card for your business, you should consider the advantages of both general consumer and small business credit cards because even though small business credit cards have the word ‘business’ in their name, they are not necessarily the best vehicles for business spending.  Such a fact proves true because of both the debunking of a popular myth and the passage of legislation that has altered the make up of the credit card industry.

Many small business owners believe that business credit cards protect them as individuals from any financial struggles their companies may endure by placing liability on the businesses themselves.  They, in turn, believe that personal credit cards leave them vulnerable to such liability and therefore represent a dangerous option.  However, small business owners are personally responsible for the debt incurred on their credit cards irrespective of whether they are using business or general consumer products because, in the minds of lenders, these individuals essentially are their businesses.

The first thing you should do before applying for a loan is go to AnnualCreditReport.com and get your credit report from all three credit bureaus to make sure that there is no inaccurate information that could be damaging your credit score. Everyone is entitled to a free credit report from each bureau every 12 months. You want to be sure to check all three because, although it is a good sign that one of them is accurate, there can be discrepancies so don’t assume that they will be the same.

The next thing you should do is maximize the positive information that is consistently being reported to the credit bureaus (and therefore on your credit report). If there is negative information on your credit report, unfortunately it is not under your control to remove it. Negative information will be removed from your credit report automatically 7-10 years after it was first reported. If this is your situation, it is even more important to increase the flow of positive information in order to dilute the negative.

As we all know, all throughout 2009 credit card issuers raised interest rates on millions of consumers. The way you tackle high interest rates on credit card debt depends on your specific situation. If you have good credit, the first thing you want to consider is a balance transfer. Typically, you need a credit score of 660 or higher in order to be approved for a balance transfer credit card, and a score of 720 or higher to get the best offers. Once you are approved for one of these credit cards, you can transfer your balance from a credit card with a high interest rate to the new credit card with a lower rate. Most balance transfer credit cards offer 0 percent interest on the transferred balance for the first year of the agreement, but generally will charge a fee between 3 and 5 percent of your balance.

While the introductory rate is usually 0 percent, you also need to consider what the regular interest rate is after the introductory period is over. The key to determining how important the regular interest rate is for your situation depends on how long it will take you to pay off your debt. You can determine this by using a credit card payoff calculator. If you are able to pay off your debt before the introductory period is over, the regular interest rate is not of much significance to you. However, if you know it will take you much longer, you should carefully consider how much the regular interest rate will cost you over time.

In this article we cover all you need to know about getting a credit card account for your church. We will discuss what you should consider before applying for a credit card, as well as offer advice on how to set up a church credit card use policy that will prevent abuses or misuses of your credit card account. We will also explain how church credit card donations can become a useful tool for both your organization and the members of your church community.

Best Credit Cards for a Church
We often get questions from people asking what kind of credit card is best for a church or non-profit organization. The simple answer is this: when it comes to credit cards, it does not make a difference whether your organization is a church, non-profit, or for-profit company.

If you choose to activate this card, the annual fee is basically like a purchase of an equivalent amount charged on the card; you must pay this balance in full if you want to avoid incurring interest. If you can’t afford to pay the total amount, pay the minimum required (typically 3% or $15, whichever is higher) so as not to be charged late fees, though the remaining balance will accumulate interest.

If you choose not to activate the card, call your provider and tell them that you have not activated the credit card and want to close your account. They may still try to make you pay the annual fee, but make it clear to them that you are not liable for any fees because you are closing your account before actually activating the card.

A person is considered new to credit if they have had their own loan or credit card for less than 3 years (or have never had one at all). For example, if you are a college student, new to the country, between the ages of 18 and 21, or recently divorced with no credit under your name in the past 10 years, it is highly likely that you have limited or no credit history.

Keep in mind that even though you fit the definition of limited credit, you may not qualify for an unsecured credit card if you have mismanaged the little credit that you have. If you have missed payments on credit cards, loans, utilities bills, or anything else that is reported to the credit bureaus, applying for a secured credit card is probably your only option.

Your credit score is calculated from a lot of different credit data in your credit report, so there is no formula that guarantees your score will go up in any specified period of time. The factors that affect your credit score include things like your payment history, the length of your credit history, the amount of debt you have, and the percentage of credit you use in relation to the amount of credit that is available to you.

Before you can start working on improving the information that affects your credit score, you need to make sure that no new negative information is being reported on your credit report. For example, you don’t want to have an open credit card account on which the lender, on a monthly basis, continues to report you as being delinquent. It’s fine if you have existing negative information on your credit report, but it is important that you cut off any additional negative information from coming in before you can start improving your score.

Your credit limit depends on your overall credit risk. Credit card companies do not want to allow you to charge a great deal on a credit card unless they are fairly sure you will pay it back responsibly. Believe it or not, they probably do not want to have to deal with collections and lawsuits either. There are a number of factors which contribute to your overall credit risk, such as your credit score and your income relative to your debt. Your credit score is essential because a credit card company can be confident in increasing a credit limit if you have proven capable of paying lower limits. Likewise, card companies want to see that you income can support your existing debt and credit lines before granting you additional credit.

Before you start looking at your options for credit cards, you should be aware that the Credit CARD Act, effective February 2010, added new rules for consumers under the age of 21 interested in having their own credit card. If you are under 21 years old, you will need to show that you are able to make payments – in other words show proof of income – in order to open a credit card account.

The other alternative is to have a cosigner on your credit card account. This person must be 21 years of age or older and be able to prove their ability to repay the debt incurred on your credit card account. They will assume joint liability for your credit card debt, so it will have to be someone who trusts you to make your payments on time and use your credit card responsibly. If you have opened a credit card account with a cosigner and want to increase your credit limit, your cosigner must agree to the increase in writing.

A good way for you to build your credit history if you are new to credit is to apply for a secured credit card. A secured credit card works just like a regular credit card with one major difference: a secured card requires a security deposit and your credit limit matches the amount of the deposit you put down. Since your credit line is tied to your deposit amount, a secured credit card will help you build credit history with low risk to both you and your lender – and your approval is guaranteed.

If you’re new to credit, it’s going to be difficult for you to get a regular credit card because you have no history to indicate to lenders that you are a trustworthy candidate for credit. You can prove it to them by getting a secured credit card in which your deposit acts as collateral against your credit limit. Once you have shown you can manage a secured credit card responsibly for about a year, it is likely that your credit card company will offer you a chance to apply for a regular credit card. People who are likely to have no or limited credit history include college students, recent divorcés or widows (whose credit history was in their spouse’s name), or people who have recently immigrated to this country.

Secured credit cards are designed for people with bad, limited or no credit history and use a security deposit that doubles as a credit limit to protect issuers from what are considered to be risky customers. If you do not have an outstanding balance at the time you decide to close your secured credit card, the entire security deposit is returned to you. Because issuers incur little risk with secured cards, these products typically also have low fee structures and minimal requirements for approval. All you generally need to do to open a secured credit card is provide a valid Social Security Number (SSN) and, of course, place the refundable security deposit.

Using a secured credit card is ultimately a great way to cost-effectively build or rebuild a solid credit history since secured cards report to the major credit bureaus in the same manner as any other credit card. In fact, no distinction is made between secured and unsecured credit cards on a credit report. Finally, since you can add to your deposit over time and thereby increase your spending limit, a secured card can also provide all the spending power you might need.

The first thing you need to do to move from a secured credit card to an unsecured credit card is use your secured credit card responsibly. Keep your balance low (well below your credit limit), make your payments on time, and pay off your balance in full as often as possible. If you can do these things consistently, most credit card issuers will qualify you for an unsecured credit card after about one year.

After you’ve proved your reliability, there are three likely scenarios for making the transition from a secured credit card to an unsecured credit card. The first is that you close your secured credit card account completely after being approved for a new unsecured card. As long as you close your account in good standing and carry zero balance on the card, your entire security deposit will be returned to you. Generally your credit card company will send your money in the form of a check.

Usury laws specify the maximum legal interest rate at which loans and credit card accounts can be extended.  A bill for one such law is soon to be introduced to the House of Representatives and would cap the interest rate on all credit card accounts at 16 percent.  While the goal is to lower interest rates for applicants that represent a high-risk to creditors, usury laws will actually hurt this very segment of consumers.

If passed, banks are not likely to respond to usury laws by extending credit to everyone that applies at a rate of 16 percent or lower.  The more likely repercussion is that banks will deny credit to consumers whose credit histories do no warrant an interest rate at or below the usury law’s cap. Thus, if passed, usury laws will prevent an entire segment of consumers from acquiring credit when they need it the most.

There will be several.  2010 will usher in the end of  “gotcha” rate hikes, which for so long have surprised consumers.  This and other changes, that are the result of the CARD Act, will cause the negative sentiment most consumers and Congress have towards the credit card industry to dissipate considerably, but it will be close to the end of the year before we see that happen.
Additionally, credit card companies will begin to compete with each other for customers again in 2010.  Competition in the market has been frozen because, due to record high default rates, the focus for issuers has been on loss prevention.  This will continue into 2010, but consumer credit will begin to become more readily available.

Lastly, and again due to the CARD Act, secured credit cards will make a comeback in 2010.  This is because under the CARD Act, consumers under 21 who want to apply for a credit card will either have to show proof of income or obtain a cosigner in order to be eligible for an account.  If neither of these options are achievable, secured cards will become the only option for consumers between the ages of 18-21 who are in the market for credit.

Yes.  You don’t have to have a credit card to have bad credit. If you have or have had a student loan, auto loan or mortgage that you have been late making payments or defaulted on, then your credit score would have been negatively affected.  Likewise if you have had a credit card in the past that you managed irresponsibly then there could be damage on your credit report for up to seven years from the date that any of your old accounts were opened.  Additionally, if you have any accounts in collections (e.g. medical or utility bills), your credit would have suffered.  Lastly, if you have declared bankruptcy in the last 10 years, then your credit is probably pretty bad.

If none of these things apply for you and your are still unable to get a loan, then you probably have no credit, in which case you may want to apply for a secured credit card.  With a secured credit card, a deposit starting at $200, acts as collateral against your loan, and you can start building/improving your credit history with very little risk to you or your lender.

Your new credit card will show up on your credit report roughly a month after you receive the card in the mail.  This first record of your new account on your credit report will mark the end of your first billing cycle.  Each credit card company reports according to its own schedule, therefore there is no set industry standard date for reporting.  Usually, most credit card companies report to the credit bureaus within a couple days of the close of your billing cycle, which falls roughly on the same date every month.  For example, if your billing cycle ended on the 15th of each month, your credit card issuer might report to the bureaus on the 16th or the 17th of each month.  Given that you haven’t received your first statement, you can call your new credit card issuer to find out when your billing cycle begins and ends.

Credit card companies report you as being delinquent to the three major bureaus after you have been late on your payment for 30 days or more.  In your case, you have been late for 67 days, so your credit score will already have been affected.  Your credit card issuer reports to the three major credit bureaus every 30 days, so it is very important that you make a payment immediately to avoid being reported as 90 days delinquent, at which point your credit score will take another hit.  The effect that your late status will have on your credit score will be marginal and can be repaired if you practice responsible behavior for the next 12 months.
However, you should check your next credit card statement carefully or call your credit card company now, because your interest rate may have very well gone up (perhaps considerably) due to your late status.  Being this late on your credit card payment could have a costly effect on your wallet, depending on if or how much your interest rate has increased.  If it has skyrocketed, you should try to pay your balance off in full.  If you can’t do that, you may want to consider a balance transfer.