Tag Archives: loans

 

Nov06

Can Credit Cards Save You Money?

Posted: November 6, 2018 by Rachel Shepard

Although it can be easy to forget as we’re swiping away, credit cards are a form of debt; the balance you build on your credit card is debt you owe to the issuing bank.

 

Given that they are debt and, by nature, debt is a negative, it may seem counterintuitive to consider that credit cards may actually help you save money — but they can. Everything from earning rewards to easy access to reusable financing can help you save money simply by using the right credit card.

 

Of course, it takes smart credit card use and responsible financial behaviors to make the most of your credit cards’ money-saving potential. No matter how strategic your plan, irresponsible use of credit cards will likely cost you more than you can save.

 

Purchase Rewards Can Be Very Valuable

 

The most obvious way your credit cards can save you money is through purchase rewards. The majority of prime credit cards — and even several subprime cards — now offer rewards programs that provide cash back, points, or miles on all of your net new purchases.

 

Most rewards credit cards have a flat unlimited rewards rate (1% to 2% is standard) that applies to every purchase. However, many rewards cards these days also have set bonus categories that provide higher rewards rates for category purchases. For example, a travel rewards credit card might offer triple points for travel-related purchases like airfare or hotel stays.

 

The best way to maximize your credit card rewards is to choose a credit card that offers bonus rewards for the purchases you make most often. If most of your budget goes toward groceries, for instance, choose a card with a high bonus rewards rate for grocery store purchases.

 

Although most credit card rewards are paid for by the interchange fees that issuers charge merchants for each transaction, many high-rate rewards cards will also charge high annual fees. Subprime rewards cards can also charge a variety of fees, so pick a credit card with no or low fees, like the ones on this list.

 

You’ll also want to be sure to pay off your purchases well before you start accruing interest fees to ensure your earnings stay in your pocket, rather than going right back to the bank. Even the most lucrative rewards credit card won’t provide enough in rewards to make paying big interest fees a good idea.

 

Issuer Portals Can Unlock Exclusive Discounts

 

In addition to purchase rewards, your credit card may also give you access to the credit card issuer’s online shopping portal. Offered by most major banks, issuer shopping and discount portals can contain exclusive coupons and discounts for tons of popular brands, as well as special offers for extra bonus rewards on partner purchases.

 

How the shopping portal works will vary by issuer. Some portals provide coupon codes to be entered at the time of sale, some portals use trackable cookies to automatically credit your account, while other portals will simply attach the discount to your card account for online or in-store use.

 

Save On Interest Fees with Credit Card Grace Periods

 

While many occasions call for a long-term installment loan that you can repay over months or years, sometimes you simply need a small loan to get you through the next two weeks. Rather than turn to expensive payday or cash advance loans, you may be able to use your credit card as a means of short-term financing.

 

Given that many payday loans can have APRs in the three digits, using a credit card — even a subprime card with a 30%-plus APR — is already a better deal. But, that deal gets exponentially better when you only need a few weeks to repay your balance. That’s because most credit cards offer a grace period on new purchases to pay off your balance before you start accruing interest fees.

 

Although some cards don’t offer a grace period (most commonly the case with subprime credit cards), cards that do offer one will provide a grace period of at least 21 days, though the full period is generally from the time the transaction posts until the day the bill for that billing cycle is due.

 

One important thing to remember is that the grace period for interest only applies to new purchases. Other transaction types, such as a balance transfer or cash advances, won’t qualify for the grace period. The interest fees for ineligible transactions will start to accrue as soon as the transaction posts to your account.

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May01

Paying for Car Repairs with Poor Credit

Posted: May 1, 2018 by Ashley Dull

While few people are overjoyed about the three- to four-figure sums that typically accompany auto repairs, the cost of getting back on the road can be downright terrifying for those without enough emergency savings.

 

Auto repairs can be particularly troublesome for poor-credit consumers who may have a hard time finding the financing they need to cover the costs. But a few options out there can help make repairs possible, some of which won’t require a deposit.

 

Use a Personal Installment Loan for Large Repairs

 

Given that the average auto repair comes in at more than $500, the bill your mechanic hands over can easily reach into the thousands. When you need to finance a sizeable chunk of money, a personal installment loan is almost always your best bet because they can be repaid through monthly payments over time.

 

Installment loans can be obtained in larger amounts than most other types of financing, typically ranging from $500 up to $35,000.  Repayment terms for most personal installment loans will range from six months up to six years. Most personal loans won’t require a deposit or collateral and can often be dispersed as soon as one business day.

 

While most mainstream lenders will prefer at least good credit for a personal loan, online lending networks can help you find lenders with flexible credit requirements. BadCredit.org’s expert-rated list of personal loan providers have large network of lenders to help you find a loan that can meet your individual needs and credit profile.

 

Use a Credit Card for Small Repairs

 

Depending on the size of your repair bill, it may be feasible to use a credit card to cover the cost. This is especially true in cases where you just need financing for a few weeks, as nearly all credit cards will offer a grace period of one billing cycle to pay off your balance before you’re charged interest.

 

At the same time, credit cards aren’t recommended for long-term financing, as they tend to have high interest rates, particularly subprime credit cards that often have APRs over 25%. Of course, even the high APRs charged by credit cards will be significantly less than that charged by a short-term or cash advance loan, which can have APRs of three digits or more.
When to Replace Instead of Repair

 

Depending on the extent of the repairs — and the state of your credit — you may be better off replacing your vehicle than putting thousands into a bottomless pit of mechanical misery. If you can get poor-credit auto financing and find an affordable car that is newer and in better condition than your current vehicle, it may be a better investment to upgrade rather than repair.

 

That being said, buying another car is a bad idea if you still owe money on your current vehicle (unless you can reasonably sell it — make sure to disclose the needed repairs in your ad). Some dealers may accept a less-than-pristine car as a trade-in, but others will likely balk at one in need of certain high-cost repairs.

 

You should also consider any additional insurance costs that you may incur from obtaining a newer car. If possible, look for vehicles that still have an active manufacturer’s warranty for the most purchase security.

 

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Feb20

Why Bad Credit Doesn’t Mean You Can’t Get a LoanThere Are Options Out There for You

Why Bad Credit Doesn’t Mean You Can’t Get a Loan

Posted: February 20, 2013 by Rachel Shepard

Although having bad credit is never seen as a positive thing, it does not mean that you will be denied every loan for which you apply. There are plenty of options for those with bad credit, as long as you know where to look. Before you get discouraged about the state of your credit rating, research these loan options and find out which types of lenders are more likely to grant you the money that you need.

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