Should You Close Out an Old Credit Card Account?

/ BY / Credit 101

Congratulations! After doing some comparison shopping, you’ve applied for and received a new credit card with a much better interest rate than your current one. Since you won’t be using that old account any longer, you’re thinking about closing it out. That’s not necessarily a good idea. To maintain the best credit score, you could be better off not using the card instead of canceling it. Answer these questions before making your decision. How long have you had the card you want to cancel? Your credit score is based in part on the length of your credit history. If you’ve had the card a long time, and you’ve kept the account up to date, that contributes to a good credit score...

Are Credit Monitoring Services Worth the Money?

/ BY / Credit 101

There are a couple of reasons why you might consider buying a credit monitoring service. If you’re in the market for a new home you might want to make sure that your credit report and your credit rating are in good shape before you apply for a mortgage. Or you may be concerned about identity theft because you’re a customer of one of the many retailers that have been hit by credit card thieves—Target, Home Depot, K-Mart, etc.—and wonder if some crook is out there using your credit card information. Credit monitoring services promise to assist you in both of these situations. They keep a close eye on your credit report at one or all of the credit bureaus and alert you...

Credit Cards Can Help You Build Good Credit -- and Earn Financial Perks

/ BY / Credit 101

A recent Bankrate survey found that 63 percent of young people in the Millennial generation—born between 1982 and 2002—don’t have a single credit card. That could be a problem as they move further into adulthood. Although the credit-card-avoiders may not get stuck with credit card debt, they will also lose out on the many benefits that come from using a credit card wisely. There are many reasons why Gen Ys don’t have credit cards. During the Great Recession, they saw their parents, grandparents and older siblings losing jobs and struggling to pay off their debts, including credit card bills. They don’t want that to happen to them. The Gen Ys are also facing a world where it’s harder to get...

Credit Reporting Agencies: What’s the Difference?

/ BY / Credit 101

The three major credit reporting agencies (CRAs) determine your credit score and provide it to credit card issuers and lenders. A good credit score will help you get approved for credit cards and for lower interest rates on loans; a bad score will make it harder to get card approval and more expensive to borrow money. But did you know that the credit scores you get from the big three CRAs--Equifax, Experian and TransUnion—may vary by several points? That’s because of the way that the three credit bureaus collect information and the way that credit scores are calculated...

What To Do If You're Over the Limit

/ BY / Credit 101

If you don’t track your credit card spending carefully, you may find yourself going over your credit limit. It’s also fairly easy to do with a card that has a small credit limit. If you’re over the limit, don’t panic. Thanks to the Credit Card Accountability, Responsibility, and Disclosure Act (CARD Act), overlimit fees are pretty rare these days, and taking the proper steps can help you avoid going over the limit ever again. It used to be that overlimit fees were big business. Credit card companies charged anywhere from $25 - $39 every time you went over the limit. What’s more, they could stack charges, allowing them to push your balance over the limit (for example, if your payment was late and you were...


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