Planning on some fun summer activities? Make sure to make sure to create a budget!

7 Ways to Stick to Your Budget This Summer

By | Uncategorized

The care-free days of summer are fast approaching — but be careful not to let those warm-weather vibes spill over into your finances. When you’ve already resolved to follow a budget, summer plans can sometimes derail that commitment. Outdoor events and summer vacations quickly upend even the most well-designed budget plan and inflate your credit card bills all year long. So, how do you stick to a budget when the days are longer, the weather is irresistible, and adventure is calling? We’ll show you the best ways to keep your spending — and your stress levels — in check with these tips to follow your budget this summer.

1. Plan Low-Cost Day Trips

The average week-long vacation costs $1,928 and the average expense for a weekend getaway is $564, according to a 2018 survey from Twine. If you haven’t already been squirreling away savings for a summer vacation, avoid racking up debt by charging a trip to your credit card — and choose a destination close to home. Plan a trip to a national park or a local beach, or even explore the downtown section of a nearby city. To sweeten the deal, pack a picnic lunch that will save you from shelling out money for food while on the road.

2. Check out Free Local Activities

Chances are your surrounding area plays host to different outdoor activities that are either free to the public or charge a nominal fee for admission, such as parades, carnivals, music festivals, and art shows. Check out your local newspaper, your town’s parks and recreation department website, and the area’s tourism bureau to find out about upcoming events. Your local library can also be a treasure trove of information on events in surrounding areas. Exploring your local community doesn’t have to cost a dime and it comes with the bonus of elevating your cultural awareness.

3. Entertain Friends at Home

Summertime is the prime season for barbecues and impromptu backyard gatherings. You may wonder how to stick to a budget when you need to plan meals and spruce up your space for entertaining guests. However, you can easily enjoy the company of your family and friends without risking your budget. Propose a game night or movie night, and ask that your guests each bring a food or dessert to share.

4. Save Small Amounts Every Week

If you haven’t already, start squirreling away a small part of your paycheck each week to put toward unanticipated summer expenses or save for a future vacation (even if you won’t reach your goal amount this year). The amount can be small enough — such as $10 to $20 — that you won’t risk stretching your budget. Try out an app like Digit, which links up to your checking account and designates a small amount to withdraw from your checking account each month. Or you can even try an old-fashioned change jar and drop in spare change that you find around the house. Over time, the savings will add up.

5. Cash Out

Make sure your budget accounts for a little spending money for weekend adventures. You may want to withdraw that amount in cash and keep it in an envelope designated specifically for your planned excursion. Then make a list of your top affordable destinations or day trips, along with an estimated price for each. Challenge yourself to stay within the amount you budgeted each time.

6. Maximize Credit Card Rewards

Now’s the time to cash in on any credit card rewards you have earned over the course of the year. Points and miles could snag you deeply discounted airline tickets or hotel stays. You can also take advantage of cash-back offers on gas — which comes in handy on long car trips. Some credit card companies offer discounts or cash back on movie tickets, amusement parks, sporting events, and shows. Just make sure you aren’t using your credit card excessively only to score rewards and discounts and always aim to pay off your bill in full every month.

7. Minimize Electricity Usage

Sky-high bills from increased air conditioner usage can also sink your budget. Try only to turn on the A/C when absolutely necessary and crack a few windows instead to allow for comfortable sleeping at night. Spend more of your evenings outside in the extended daylight, and give your lights and screens a break.

Check in With Your Credit

Don’t let those summertime vibes destroy your budgeting — or your credit. Whether you’re contemplating how to stick to a budget during the summer or looking to tune-up your credit report, now is a great time to take stock of your financial situation. Get in touch with the pros at Ovation Credit, where we’re always willing to lend a hand. Contact us for a free consultation today.

What is the best credit score? Find out now.

What Is the Best Credit Score?

By | Credit Reports, Credit Scores, Uncategorized

Working to achieve the best credit score is a worthy goal; after all, having good credit opens the door to an array of financial benefits. But hitting a magical number just to say you did it isn’t the best use of your time or other resources. In addition to understanding the best credit score, it’s equally important to understand how to best reach your credit goals, which won’t necessarily correspond to a single number. Here’s what you need to know.

The Highest FICO Score (and Why You Don’t Actually Need It)

FICO is the most widely used credit scoring model and is utilized by lenders and credit card companies to determine your financing approval and your interest rate. On the low end of the spectrum is a score of 300, while consumers with the highest possible score hit an 850.

While the achiever in you may set your sights on 850 as your ultimate goal in the credit repair process, it’s actually not necessary. Why? Because lenders and other creditors use credit score ranges to offer the best rates. As long as you’re in the “excellent” category, you’ll get the same low rate. Depending on the type of financing you apply for, an excellent credit score could be anywhere between 720 and 760. If you hit that benchmark, you’ll receive the same interest rate as someone with an 850.

How to Improve Your Credit

If your current credit score falls below the “excellent” category, it’s definitely in your best interest to fix your credit. There are a number of ways you can do this, no matter what your current financial situation may be. If you’re a DIYer who wants to take advantage of the best credit score possible, you just need to follow these three steps before you start seeing noticeable improvements.

1. Dispute Credit Errors

If you don’t already have the best credit score, the first major step in the credit repair process is ensuring the accuracy of your current credit report. You can request a free copy every 12 months from each of the three major credit bureaus. Once you have them, you’ll see every credit line you’ve had for the last several years. Make sure each one is accurate, especially when it comes to late payments and delinquencies.

When you find something that isn’t current, you can send a credit dispute to the credit bureau. If done successfully, you can get the negative item(s) removed and improve your credit score. The credit bureaus allow you to submit disputes online and through the mail to make it as convenient as possible. They’re legally required to investigate your dispute request within 30 days.

2. Lower Your Debt

Once your credit report is updated and accurate, you can still take some steps to improve other areas. One of the most important factors affecting your credit score is your debt, especially revolving debt from credit cards or another line of credit. Try to pay down that expensive revolving credit as quickly as possible. As you do, you’ll notice a distinct increase in your score, getting you closer to the best credit score possible.

Even if you pay off your credit card balance each month, your charges can still be bringing down your credit score. Your credit card company may report balances to the credit bureau before your payment is due. Try making payments at least twice a month in order to lower your balance amount before balances are reported.

3. Make Your Payments on Time

Most importantly, preserve and improve your credit by making your payments on time each month. Even a payment that is 30 days late can cause a drop in your credit score. Every 30 days after that can cause another dip, so don’t let the same bill drag down your credit score multiple times.

An effective way to avoid this problem is by signing up for auto bill payments, either through your bank or each specific creditor. As long as you keep on top of your bank account balance to avoid overdraft fees, you can successfully fix your credit with on-time payments each month.

Need Help Fixing Your Credit?

A comprehensive credit repair plan can help you get the best credit score possible in the shortest amount of time. Enlisting the help of a professional credit repair service ensures you’re maximizing your opportunity to improve your credit score.

Sign up today for a free consultation from Ovation Credit to find out how we can help.

Marriage is a big commitment. It's important to discuss finances and credit scores before the big day.

Getting Married? Have This Financial Conversation First

By | Uncategorized

You think you know everything about your fiancé? Think again. Before you get married, you and your future spouse need to have the money talk first. It won’t affect whether or not you both say “I do,” but it might change whether you both agree to get a shared bank account.

In addition to maybe getting a shared account, here are six things you should talk about.

1. What kind of debt do you both have?

Did you both rack up a lot of debt going to college? What are your monthly car and student loan payments like? What is your debt-to-income ratio? If either of you has a lot, it’s best to say so before you tie the knot. Having the infamous “Where did all of our money go?” conversation is never fun and can lead to problems that extend beyond finances in a heartbeat. Know what kind of debt your future spouse has. It may suggest that you should either have separate bank accounts, or that one of you should be in charge of all finances so that credit repair can take place.

2. Know each other’s credit scores and histories.

A strong credit score is needed if you want to buy a house one day. If your spouse frequently misses payments because he or she doesn’t manage money well (and might need to fix his or her credit), it can put a big strain on your relationship. You should know what each other’s score is because it might change your respective responsibilities. Maybe one of you agrees to make all payments, or you add your spouse as an authorized user on an account to improve their credit score.

Looking over each other’s histories might also reveal credit errors. If you spot any, you’ll want to start a credit dispute as soon as possible. One reason is, if you plan on having kids, it’s a lot easier to fix a credit score when it’s just the two of you because you’ll have more cash every month to put toward payments. Another reason is that credit disputes and credit repair can take time. The sooner you begin the process, the better.

3. Will you need to work together to improve credit?

Do both of you suffer from low credit scores? If you need a loan, will either of you qualify? As stated, credit disputes and errors take time. To fix credit (or just improve credit), it may require a joint effort. To do so, you’ll both need to make a concerted effort. Not only will all bills need to be paid on time, but one or both of you might need to take out a secured loan or line of credit to begin the credit repair process. From there you’ll both need to diversify your lines of credit and begin paying down your debt.

Many experts suggest paying off debt from smallest to largest. This will remove some of your monthly obligations and free up more cash to throw at your larger debt.

4. What are your long-term goals?

Do you want to travel? Buy a house? Have kids? All of these are big financial commitments, and you need to know about them so you can start budgeting. Depending on the goals, one or both of you might need to make some spending changes. Impulse and fluff buys may need to be scaled back and a monthly budget put in place. If it’s a struggle to put away money each month, then you’ll need to establish a savings plan as soon as possible.

5. Should you have a prenup?

Unfortunately, approximately half of all marriages end in divorce. If either of you has worked hard to establish a strong financial portfolio, then a prenup may save you at least a little heartache if or when you two do decide to call it quits.

6. Establish a monthly budget and savings goal.

Come up with a list of non-negotiable monthly items—mortgage, car payments, credit card payments, utilities, etc. How much money must absolutely be set aside to cover everything? Look at how much is left over, and put a little aside for both of you to spend on fun items. The rest needs to go into savings. How much you spend on your fun (or unnecessary) purchases is up to you. If your partner considers something to be a must-have, but you don’t see it that way, consider not pushing it if it’s not too much every month. Everyone has their own quirks. However, if you are just scraping by every month and accumulating credit card debt in the process, it may be time to have a talk.

Get Expert Advice

Luckily, it doesn’t just have to be the two of you. At Ovation Credit, we’re here to help, too. For a free consultation, go to our site. We can help you improve your credit, fix any credit errors, and resolve any credit disputes.


5 Reasons Why Paying Your Bills on Time Is Not Enough

By | Credit Scores, Uncategorized

Accounting for 35 percent of your credit score, payment history is the number one factor affecting your credit standing. A single missed payment could lower your credit score by 60, 80 or 100 points, depending on the date of the late payment and your current credit score. Generally speaking, higher scores are hit harder by late payments than lower scores and older late payments have less impact than recent ones.

If you want great credit, you must pay all of your bills on time — that’s a given. However, excellent payment history alone will not give you the credit score you desire. You must also pay attention to the factors that make up the remaining 65 percent of your credit score.

5 Factors That Influence Your Credit Score

Credit scoring models look at a variety of factors when calculating your score, including payment history, credit card utilization, length of credit history, mix of credit and inquiries.

1. Credit Card Usage

With the exception of payment history, credit card utilization impacts your credit score more than any other factor. A whopping 30 percent of your credit score depends on it. Your utilization score represents the percentage of revolving debt you have in comparison to the total amount of revolving credit available to you. Most revolving credit comes in the form of credit cards, but it can also include any other type of revolving credit, such as a revolving loan.

Ideally, your credit card utilization should be 30 percent or less. For example, if you have $5,000 in revolving credit, your total balances should add up to no more than $1,500. To find out your utilization percentage, divide your total balance by your total credit then multiply the answer by 100.

2. Length of Credit History

The length of your credit history accounts for 15 percent of your credit score. To calculate your length of history, credit scoring models determine the average age of all credit accounts listed on your credit report. Closed accounts that have fallen off of your credit report are not considered.

When it comes to credit history, there is no magical number you should strive for. However, the longer history you have, the better.

3. Mix of Credit

Accounting for 10 percent of your credit score, your mix of credit depends on the types of credit accounts listed on your credit report. A diverse mix that includes installment loans, revolving credit and secured credit is best. The following is a brief explanation of each type of credit.

  • Installment loans: Personal loans, student loans, furniture loans
  • Revolving credit: Credit cards, retail credit cards, gas cards
  • Secured credit: Auto loans, home loans, equipment loans

For the best possible score, maintain a mix of credit accounts but don’t go overboard. A single installment loan combined with two credit card accounts and an auto loan is sufficient to show how you manage different types of credit.

4. Hard Credit Inquiries

There are two main types of credit inquiries: soft and hard. Soft inquiries are initiated without your knowledge by companies screening you for pre-approved offers. They do not affect your credit score.

Hard inquiries, however, account for the remaining 10 percent of your credit score. Hard inquiries include any and all credit applications initiated by you or by a lender on your behalf. Scoring models look at two factors when considering hard inquiries: the number of inquiries present and the date they were initiated. Older inquiries carry less weight than newer ones.

5. Multiple New Accounts

Too many new accounts can lower your score by decreasing your length of credit history and increasing the number of hard inquiries appearing on your credit report. For this reason, you should avoid opening multiple accounts within a short amount of time. Strive to wait at least six months between credit applications.

How to Improve Your Credit Score

To improve your credit score, take steps to address and optimize all of the factors affecting your credit score. The following tips will help you.

Improve Payment History

Do this by making all payments on time. If you have late payments listed on your credit report, contact the lender to see if there is a remedy. You may be able to restructure your loan or set up a payment arrangement in exchange for the removal of the delinquency from your report. This only works if your account is not currently in collections.

Lower Credit Card Utilization

Do this by paying down your credit card balances or asking for a credit limit increase on one or more of your revolving accounts. Remember, balances should account for no more than 30 percent of your available credit.

Increase Length of Credit History

This can be accomplished by being patient and letting your credit profile age. Avoid obtaining new credit, as this will shorten the average length of your credit history. Also, consider leaving older accounts open even if you’re not using them.

Diversify Mix of Credit

You can do this by obtaining new types of credit. If you have two or more credit cards, do not apply for more revolving credit. Instead, consider taking out a personal loan.

Decrease Hard Credit Inquiries

Do this by spacing out your credit applications. Only apply for credit if it’s absolutely necessary. Note: multiple inquiries for a car loan or mortgage are often grouped together and only considered as one inquiry, provided they occur within a reasonable time frame.

Credit scoring models are complicated and mysterious on purpose. Credit agencies do not want you to know or understand the exact formula they use to calculate your credit score. However, they offer enough transparency for you to optimize your credit profile in an effort to earn the best possible score. If you learn all you can and take steps to improve your credit profile, you will see your score improve over time.


College Students – Don’t Make These Common Financial Mistakes

By | Personal Finance, Uncategorized

College can be expensive, and some college students add to the price tag when they make financial mistakes such as using student loan money for a trip. Another mistake some make is going to a pricey college for four years when they could go elsewhere for two years and transfer. Here is an exploration of these mistakes.

College students financial mistakes

Using Student Loan Money for Unintended Purposes

Many times, students have money left over from their loans after tuition, room and board, and other direct expenses are taken care of. These loans are supposed to cover educational expenses and educational expenses only. Related expenses such as essentials for a dorm room could be okay. But a vacation during spring break or splurging on renting a high-end place — most likely not. Yet, quite a few college students see that leftover money as “free money,” not realizing that years of compounding interest rates could end up doubling the price tag of that spring break trip.

The solution is usually to anticipate your expenses well and to accept only that amount of student loan money. If you don’t have the money, you won’t spend it.

Not Taking Advantage of Financial Opportunities

Going to college inexpensively has become trickier, but there are still some ways, especially if you live in certain states. For example, community college students in Tennessee, Rhode Island, Oregon and New York will be able to attend for free by 2018 (or are already able to), provided that they meet residency requirements, GPA requirements, income requirements (sometimes) and a few other regulations.

Some other states also have similar programs. For example, tuition in Minnesota is free if you study a high-demand subject. California also gives one year of community college free, and low-income students have been able to attend with their per-credit fees waived since 1986. Virginia’s community college students get a $3,000 annual grant when they transfer from a state community college to a participating four-year college. In short, ways to save can be found in many places, cities and states.

What does all this mean? It means that some college students who aim for four-year degrees should seriously consider attending community college first and then transferring to a school offering a bachelor’s program. The difference could be many tens of thousands of dollars and paying off student loans much more quickly.

College Students Using Credit Cards Irresponsibly

Some students graduate owing as much as $7,000 on their credit cards; the average student graduates with $3,000 in the negative column and has four or more cards, according to Sallie Mae. College is the first taste of freedom for many students, and even those who charge only $20 here and there, or even just $500 a few times a year, could find themselves at risk of hurting their credit scores sooner rather than later.

After they graduate, they may be looking for work while juggling obligations in the way of rent, student loans and credit cards. It takes just one missed payment for a credit score to suffer.

Responsible credit card use in college often means:

  • Having a sound reason for getting a card
  • Using a card with low credit limits and interest rates, and no annual fee
  • Paying your balance fully every month
  • Having one card
  • Charging something only when you know you can afford it
  • Being the sole user of your card (not lending it out to friends)
  • Not getting cash advances

If you think you may be prone to abusing your credit card, go ahead and close the account. On the other hand, if you have already graduated, credit repair services could help you get back on track.

College should be a time of great freedom and learning. Making good decisions can set you up for life, but it can take only one financial misstep to hurt you.



How to Pick the Right Credit Card

By | Credit Cards, Uncategorized

Choosing the right credit card can be a daunting task. You must consider your credit score and eligibility before anything else. If you have at least an average credit rating, then there are a set of questions you will always want to ask. Take the time to address these common factors to determine the best possible credit card for you.

Right Credit Card


What Type of Credit Card Is Right for You?

Are you a big shopper or is your credit card more about building credit? Regular spenders can look at cashback and other rewards. A slightly higher annual fee could get offset by the amount you get credited from your incentives. Meanwhile, what if you are getting a card to build your credit score? If this is the case, you should look for one that’s affordable to maintain with minimal use.

What about the interest rate of your card? You have little control over that unless you have nearly perfect credit. The best interest rates on credit cards are typically in the 9.49 to 12.99 percent range. But remember, these rates are still high; you should not feel comfortable carrying any real amount of debt on your card.

Alternatively, borrowers with good credit can opt for a 0 percent card. This option gives you the chance to avoid paying interest for a set period. If you fail to pay off your debt in time, the accrued interest will add on. This card is appealing for sure, but you should treat it like a consolidation loan.

Choosing the Right Annual Fee

You would think the best annual fee is none, but this is not always the case. You must compare the other details of a credit card to know what it’s worth to you. The other fees could pile up on a no-fee card and make it cost more than one with, say, a $39 annual fee. Nevertheless, if you are targeting a small limit ($300-500), it would make complete sense to choose the card with the lowest annual fee.

Chase Higher Credit Limits

Are you still establishing your credit? If so, the right credit card for you would be with a credit card provider that will increase your borrowing limit over time. You can ask the company or search in Google to see what experience others have had with the same card.

Increasing your credit limit does not have to be a bad thing. Keep your debts under control, and every limit increase will result in a reduction in your debt-to-credit (credit utilization) ratio.

Furthermore, if you are starting off with a secured card, make sure you can convert it into an unsecured card at a later date. Make sure this card actually converts and doesn’t just result in a pre-approved application for a different card, as keeping the original one helps you sustain a higher average credit age.

Choosing the Right Card APR

Credit card APR rates are based on the issuer. You won’t find any super low-interest rates, but there are some cards with a 0 percent offer for the first 12 to 24 months. If you can qualify, it would be a good idea to look into those options first.

You should absolutely compare credit cards based on their APRs. The problem is that you do not know ahead of time what rate you will receive. Your creditworthiness is evaluated, and your credit report gets pulled. After that, you get an offer for the card that states the APR you will receive.

The only easy way to compare APR rates by card is to check the range. Most cards come with three variable APR rates. You can assume, based on your credit status, that two of these rates are possible for your situation. So, look for the best cards (compare other terms) in the lowest interest range.

Keep in mind that your goal should not be to carry debt on your credit cards. Therefore, going with a card with more incentives but a 1 to 2 percent higher interest rate is perfectly fine.

Check the Balance Transfer Terms

You might not make balance transfers yet, but in the future, there is a strong chance you will find them valuable. So, you should keep an eye out for optimal balance transfer terms. Start by comparing the actual fee for making these transfers. Then, check the introductory offer — in most cases, you will receive around 12 months of no interest before your transfer must be paid off in full.

The fee for making a balance transfer is often in the 3 to 5 percent range. Some of these credit cards offer a promo period where there is no transfer fee. These particular cards will serve as interest-free loans, as long as you can pay them off before the promo period is over.

Now you are ready to find the right credit card for you!

Picking the right credit card for you will take some time. You must compare the options based on both your credit status and your spending habits. Some cards offer as much as 3 to 5 percent in cash on your purchases. Make a real effort to compare the terms, as you don’t want to be sucked in by a card that’s only good on the surface.



Student Loan or Credit Card Debt Which Is Worse?

By | Debt, Uncategorized

Credit cards and student loans are two major debt lines plaguing American households today. It’s said that the average American family carries $16,061 in credit card debt and a whopping $49,042 in student loan debt.

The latter statistic is worth looking into further.

Student Loan and Credit Card Debt

How Your Student Loan Impacts Your Credit

Your student loan is as real as any credit card or loan on your credit file. It’s not anymore “forgiving” than any other type of installment debt. This means every delinquency will hurt your credit score.

The worst case scenario comes from defaulting on your student loan debts. This is something you absolutely want to avoid. It can send even the strongest credit scores down 100s of points. The road to recovery will be long, and the damage will stay on your credit report for seven years.

You can usually negotiate with your student loan provider. If you’re in financial distress, try to work out a payment plan for the near future. Even avoiding a delinquency entry on your file can save you an 80-point drop after your first 30 days of being delinquent.

Your student loan reports both good and bad. However, it’s the bad that does the most to your credit rating, while good efforts have little reward. You need to avoid the penalties to your FICO score to have a chance to repair your credit effectively.

How Credit Cards Differ from Student Loans

Credit cards are a type of “revolving” debt, which means there’s an open credit line at all times. You will be able to borrow up to your max amount so long as the minimum monthly interest payments are paid.

It’s imperative to stay up to date on your credit card debts. Defaulting will cause extensive damage to your credit. You can typically pay a very small payment to keep your card alive. Meanwhile, the minimum payment for your student loan might be a bit more difficult to sustain.

Your credit score’s second-biggest factor is your utilization rate. This is the amount of debt you carry versus the amount you’re able to borrow. The higher it is the worse it says about you as a borrower. You want to keep it low (below 30 percent) for as long as possible; your payment history is another calculation variable and it considers your previous utilization levels.

Pay Credit Cards or Student Loan First?

It’s quite the dilemma. Paying your student loan helps with offing a major outstanding debt. However, paying off your student loan will not impact your credit utilization rate for the better in any way.

If you have a substantial amount of credit card debt, it makes sense to tackle that first. Each $1,000 you knock down will have a bigger impact on our credit rating, but keep in mind if your student loan runs into default it will be all for nothing.

Your payment history still remains the number-one factor in your FICO score calculation. Thus, it’s a good idea to see how you can improve it. This would mean maintaining payments on your student loan while reducing other debts.

You want to use any extra cash to tackle your overall credit card debt. The goal is to bring your utilization rates down as much as you can. This can be done from accepting credit limit increases too – so long as you avoid using the newly available funds.

Using Tax Refunds to Pay Off Student Loans

You will not want to make the mistake of using your tax refund as a way to pay off your student loan. Everyone thinks it is hard to take care of, so using your taxes is a sensible way to get the debt under control.

The truth is, your student loan will not hurt your score if the debt remains on your balance sheet. Trouble only arises when you run delinquent or if you default the loan. This means you can leave this particular installment loan for last while focusing on paying off higher-interest debts.

You are endangering your creditworthiness by putting your tax refund to use to pay off your student loan. The large lump sum can go toward your credit cards and have a much greater impact. Remember, credit cards accrue interest month after month as you fail to pay them off; it won’t take long for your debts to pile up if these are left unchecked.


At the end of the day, the worst type of debt to carry is the one you fail to pay off. It’s important to prove you are a good, trustworthy borrow in every sense of the term. Therefore, you must maintain positive status with your accounts (including your student loan) even if you only pay the minimum.

If you ever feel unable to pay your student loan payments, consider one of the three payment plans they offer. You can arrange to pay as you earn, based on your income or contingent on a certain amount of generated income.

If you fail to come to a deal then missing your payment will result in a late payment entry on your credit report. The damage will be irreversible; now that you know what’s at stake, make sure you sort your debt repayments accordingly.


Boo! Credit Scores Can Be Scary, Fear Not with These 5 Secrets

By | Credit Scores, Uncategorized, Your Credit

Credit score repair company

Credit Scores can seem scary when you think about how that three-digit number can affect so many financial decisions in your life. Frightening enough, that score can then scare away lenders when you’re applying for a loan or a mortgage. The ones not frightened away give you a horrifying interest rate!

Before you go and hide under your covers, here are 5 ways to calm your fears and improve your credit score.

1. Pay Off Your Balances, Especially Large Ones, Quickly

This pointer might sound obvious, but the sooner you can eliminate your balances, the healthier your credit score will be. If you make a hefty purchase with a credit card, try to pay it off right away, even if you must sell a favorite possession to obtain the funds. When you do so, you might find that your score goes up substantially. Plus, you’ll lower the interest rate you’re paying. At the very least, try to pay down your highest balances to the greatest extent that you can.

If you’ve routinely paid your credit card bills late, don’t fall into despair and assume that punctual payments won’t do you any good now. Instead, start paying those bills on time. Despite your history, your credit score will eventually reflect your newfound effort. What’s more, you’ll get into a good habit.

Remember as well that you can use an online service that will automatically pay your credit card debts each month. Such a tool will ensure that you won’t ever forget one of your bills.

2. Consider a Debt Consolidation Loan

You could speak to a financial expert about taking out a debt consolidation loan. This solution isn’t ideal for everyone, but perhaps you’d benefit from one.

First, you might find it easier to pay off your credit cards by combining the amounts of money you owe to various credit card companies into one sum. It might feel less painful to make a more substantial payment each month rather than a series of smaller payments. Plus, you won’t accidentally overlook a payment that you owe. Even more appealing, your overall interest rate will be lower. And taking out such a loan might soon result in a higher credit score.

3. Bring Your Credit Utilization Ratio Down

Your credit utilization ratio is the portion of your total credit limit that you spend every month. This ratio should be less than 30 percent. Of course, that number might sound low, especially if your limit is less than $1,000.

Keep calculating your credit utilization ratio each month. If you find that it exceeds 30 percent, try to pay more with cash or a debit card. You could also try to make fewer purchases, rely on coupons and discounts more often or start shopping around for less expensive products and services.

Another way to improve your credit utilization ratio is to ask for a higher line of credit. That way, you might not need to reduce your spending rate. If you have any credit cards that will grant such an increase without investigating your credit, consider making this request. Just be certain that none of those companies plan to do a hard credit check; having such an inquiry performed lowers your score a little.

4. Don’t Be Afraid to Use Your Credit Cards

Even though it’s important to keep your credit utilization ratio down, you should still be making regular purchases with all of your credit cards. Spending with your plastic and then making your payments in full is a highly effective way to raise your credit score. By contrast, when you completely avoid taking your credit cards out of your wallet or purse, you’re not doing anything positive for your credit report. And closing one or more of your credit cards could actually hurt your score.

On top of that, using your credit cards might allow you to collect exciting rewards. Possibilities include securing special deals on airfare and hotel stays as well as getting cash back when you buy certain items. Why pass up those goodies?

5. Seek Help from an Outstanding Credit Repair Service

Finally, a dependable credit repair service can help you boost your score and maintain that higher number over the long haul. It can keep careful track of your credit report and identify any mistakes or irregularities that might be unfairly damaging your credit.

The experts who work at such a company could also sit down with the credit card companies and other parties you owe money to. And they might be able to hammer out new agreements that are more lenient and favorable to you.

So there you have it: five financial tricks that can lead to real credit treats. These actions could provide you with the monetary rewards ― including better loan terms and insurance rates ― and the peace of mind that come with a healthy credit report.


How Can I Improve My Credit Score?

By | Uncategorized

fix your credit

Your credit score isn’t a mysterious number. You have direct control over every single point. Some improvements will take longer than others, but there are a number of steps you can take to improve your credit score both immediately and in the future.

1. Order a Credit Report

You may receive a monthly credit score from a credit card company or get your score in a letter when you’re denied for credit, but your score doesn’t tell the whole story. You need to see your full credit report to understand exactly what’s impacting your score.

Things you’re looking for include total number of accounts, account balances, payment history, credit inquiries and negative items such as collection reports. Once you understand what’s reported on your credit report, you can begin your plan of attack.

2. Dispute Negative Items

Depending on your starting credit score, one negative item, such as a late payment or charged-off account, can drop your score 100 points or more. If you successfully dispute a negative item, your credit score will bounce right back up to where it was.

To win a dispute, the information on your credit report has to be either inaccurate or without adequate supporting documentation. Some common items to consider disputing include the following:

  • Negative remarks that have the wrong date.
  • Collections or charge-offs that were added back to your credit report after a bankruptcy or settlement.
  • Accounts where you don’t recognize the lender or collection agency.

When you file a dispute, the lender or collection agency is required by law to show proof that the information is accurate. If they can’t do so, the negative item must be removed.

3. Stop Applying for New Credit

When trying to repair your credit, think like a doctor — first, do no harm. Every time you apply for new credit, your score for recent inquiries goes down whether or not you are approved. If you are approved, your average age of accounts also goes down because of the new account.

Recent inquiries and age of accounts add up to about 25 percent of your total credit score. That leaves a lot of room for improvement just by pressing the pause button.

4. Look Into Credit Limit Increases

The only possible new credit you should consider is a credit limit increase on existing credit card accounts. The amount you owe in relation to your available credit makes up 30 percent of your credit score. One or more maxed-out credit cards can tank your score.

The reason to look at credit limit increases but not other forms of new credit is that credit limit increases usually don’t have a negative impact. An increase doesn’t open a new account, so your average age of accounts doesn’t go down.

At many banks, a credit limit increase request won’t count as a credit inquiry, either. Look for online offers to increase your credit limit or a credit limit increase request button. Most banks will warn you if they will pull your credit report and make an inquiry. If they do, check your other credit cards for offers that won’t require a pull.

5. Pay Down Your Credit Balances

Generally, a maxed-out card of around 90 percent of the credit limit is terrible, 75 percent is bad, 50 percent is OK, 30 percent is good, and less than 10 percent is excellent. The faster you can get your credit card balances down to these thresholds, the faster your credit score will improve.

Note that even people who have never paid a dime in interest need to watch their credit card balances. Your credit score balance is calculated on the statement date.

If you run up $900 in charges on a card with a $1,000 limit, your credit score will plummet when the monthly statement is issued. The good news is that if you pay the balance in full by the due date, your credit card will go right back up when the next statement shows a $0 balance.

6. Use Your Credit Cards

Always having a $0 balance on your credit cards is actually worse than having a small balance. The reason is if you aren’t using your credit cards, the credit scoring model doesn’t know what you’ll do if you suddenly start using them. Always try to use your credit cards for at least one charge each month.

Some people mistakenly believe this means you have to pay interest to have a good credit score. You don’t. When you have a small balance on your credit card statement, you can still pay in full each month (before any interest accrues) and have an excellent credit score.

7. Set Up Automatic Payments

Late payments do a lot of harm to your credit score, but it’s easy to simply forget about a bill. To make sure this doesn’t happen, put each of your credit cards, loans and other monthly bills on auto pay.

If you’re worried about being able to pay in full each month, set up automatic minimum payments, and then pay the rest when you can. Payments are considered on time as long as you pay the minimum amount due.



Home Equity Loans and Your Credit

By | Credit Repair, Credit Reports, Credit Scores, Home Buying, Homeowner, Mortgage, Personal Finance, Uncategorized

Home equity loans, as the name suggests, are a way for homeowners to borrow against the equity that they built up in their home. For a number of years following the 2008 financial crisis, lenders were reluctant to offer home equity loans because the value of so many homes had decreased. This lowered the equity that people had built, so it was difficult for many Americans to take advantage of them.

The good news is that as the housing market has stabilized, fewer people are at risk of defaulting on their mortgage, and home values are on the rise. In fact, the home equity market has improved for its third straight year, and, according to USA Today, the number of loans increased by about 20 percent in 2015. Consequently, lenders are more willing to extend home equity loans to customers who qualify.

The key word is “qualify.”Owning a home and having some equity doesn’t mean you automatically qualify for a home equity loan. Lenders want to be sure that you’ll be able to repay your loan. Your credit score and credit history are key indicators. So lenders won’t just look at the amount of equity that you have in your home, they’ll review your credit score and your payment history on other lines of credit, such as credit cards and your existing mortgage.

Credit Scores

While a potential home equity borrower may be current on all of his loans, he may still have a credit score that is too low for him to qualify for a home equity loan. Enlisting the help of a credit repair service such as Ovation Credit Service is a great way to improve your credit score. Our services work with credit bureaus and creditors to resolve issues that may be hurting your credit score.

A key service of credit repair services is educating you about factors that are impacting your credit score and keeping it lower than it could be. Not everyone understands how things like credit utilization and the number of open lines of credit can affect credit scores. Having an expert on your side to help navigate your credit report can help improve your score and show you which behaviors are likely to have the greatest impact on your score.

Types of Home Equity Loans

There are a lot of home equity lenders. You can go to your local bank, where you already have a relationship, or shop online for the most competitive rates. There are two main types of home equity loans:

  • Traditional Home Equity Loans are a lump sum amount paid to you when you’re approved. These are best for repaying credit card debt, consolidating other loans, paying for your kids’ college tuition, or splurging on a big-ticket purchase such as a car. The funds are given to you, and you make payments based on how much you borrowed.
  • Home Equity Lines of Credit (HELOC) are a great way to borrow against the equity in your home and keep some funds in reserve. If you’re renovating a room in your house or want to take a nice vacation, you can tap into some of the equity available to you. You only pay back the amount of equity from the line that you used, but you have other funds available if you decide to expand the scope of your renovation project or extend your vacation.

Things to Consider

A traditional home equity loan is a great tool for borrowers who want to improve their credit score. Having some cash available to consolidate high-interest credit cards—or pay them off entirely—is a good way to manage your credit. A credit repair service can recommend which lines of credit you should pay off first to have the greatest impact on improving your credit score.

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