If you have any charge accounts now, or have ever borrowed from the bank
to buy a car, or if you ar paying on a mortgage, there is credit
information on you.
Up until a few years ago, you could only guess at what your credit rating
was, because the credit bureaus who keep track of borrowers wouldn't tell
the borrowers anything! But that's been changed through several laws, and
now the bureaus have to send you your credit file when you request it.
If you've been denied credit on the basis of their record, they will send
you a copy of that record without charge, if you request it within 30 days
of the credit denial. If you haven't been denied credit but just want to
know what your file says, you must pay a small fee to find out.
Why You Really Must Get Your Credit Report...
It is well worth your trouble to obtain your report. You may well find
(because thousands do) that there is a piece of misinformation that is
injuring you without your knowing it, which you can straighten out by
submitting copies of documentary proof (never mail originals of anything
important - it may get lost in the mail) of bills paid, payments made, etc.
What To Do If You Are "Unlisted"
If, for one reason or another, you are not listed, or they have
insufficient information on you to "rate" your suitability for credit, you
must take steps to correct this.
What To Do If You're New in Town
If you have no record because you hold no cards and have no charge
accounts, or because you have just come in from out-of-town, then you'd
better start assembling one. It may sound a little ridiculous, but nobody
will lend money to someone's who's always paid cash! You have to have
borrowed money or run up charges and paid them back to be able to borrow
larger sums as time goes along.
Start with the local merchants in your immediate area, the ones that
already know you.
Even if you don't need it right now, ask them if you can set up a charge
account with them. In most cases they'll be glad to oblige you, they
already know you're local, and that you patronize them regularly. when you
get the credit, charge a few items each week, and pay your account
promptly when presented. In this way, you'll build up a good credit record
with these merchants in a short time.
Get Your Bank In on the Act
Go to the bank where you keep your checking account, and ask to borrow a
nominal sum (say $500), which they are unlikely to refuse you.
Do this even if you don't need the money, because you do need the
repayment record on their books. Repay the loan on a regular basis when
due.
Do not accelerate, and pay it all back the next month. Strangely enough
the banks do not like that, because to them that indicates a "feast or
famine" situation, rather than a steady payer.
The interest cost on this loan, even if you have no need for the money,
will be well worth paying to build up your credit record. Besides, you can
minimize this interest cost by depositing the money you have borrowed
(assuming you do not immediately need it), in a savings account, and
collecting the interest, which will defray a good part of the cost of the
interest you are paying.
Once these charge accounts and the loan have been operating for a while,
proceed to stage two, and ask a large local department store for a charge
account. Most likely they will be happy to give you their charge card.
Build up your rating with them by occasional purchases and prompt payment,
and then you proceed to stage three, and apply for the less selective
national credit cards, Master Charge and Visa, which you should a this
point be able to get without too much difficulty.
On the Road
Once you have national bank credit, it's easy to get credit from all the
oil companies, which makes traveling around a cash-free pleasure. Some gas
stations take national cards like Master Charge, but most only take their
own credit cards, so you should not overlook these, just because you
already have others.
First Class With No Cash
Once you have all the other cards, a paid-up loan or two, and a fine
record of promptly paying your bills, you may be able to get the most
selective cards of all, the "travel and entertainment" cards.
These are American Express, Diners' Club and Carte Blanche. These cards
operate on a different system than ordinary retail store cards, or the
national bank cards, both of which are revolving credit plans on which you
pay a small amount each month, until your balance is all paid up.
The store or bank hopes you take a long time to pay, because they make
their money on the 1 1/2% monthly (which is 18% yearly!) finance and, or
interest charges.
The T&E cards, however, expect you to pay your bills at the end of the
month! Let your account get 60 days or more delinquent, and they'll cancel
you out as fast as a flash of lightning. Although these cards do not
charge interest, they do charge you a fee for membership.
Let Me Entertain You
So how do you get these marvelous bits of plastic that open up the doors
of exotic nightspots in Tangiers as easily as your nearby Howard
Johnson's? Your good credit record, that you have already established,
will be the most help.
Since the T&E people want you to pay your bills promptly each month, they
want to know that you have a steady record of paying bills promptly to
other people.
So first American Express, or Carte Blanche, or Diners' Club, looks at
your credit record. Then at your salary or other income. Most of them have
cut-off points below which they will not grant their cards. But even if
you earn more than their minimum requirements, they don't automatically
okay you for their credit...
They look at your stability!
How do they measure stability? How long have you worked on your present
job? If you don't have a minimum of two years of steady work in one place,
they may not consider you at all. How long have you lived at your present
address? At your previous address? And do you rent an apartment which
means you could move tomorrow, or do you own your own house, which means
you will probably still be in the same place next year. How stable is your
livelihood? Do people in your field of work get laid off frequently?
Now You Can Really Start to Live!
Once you have all the major national credit cards in your wallet, you can
live like the millionaires do, even though you haven't yet become one.
You can go into a fancy store, or even call them on the telephone, and
order those wonderful luxuries which make life so much more exciting, like
furs and diamonds, for your loved one, or new furniture or appliances for
your living room, bedroom or kitchen.
All of this can come true in the wonderful world of credit.
Now in today's world you can charge almost anything on a credit card, from
admission to a medical care at a hospital in Atlanta, university courses
in New York City, funerals in Los Angeles, and even the services of legal
prostitutes in Las Vegas.
Erasing the Bad Marks
But what do you do if you haven't been able to pay your bills promptly, or
you've run up more than you can handle, or you don't have a very stable
work history? Do you have to give up the dreams of credit-card living? Not
entirely!
Once you find out which credit conditions in your background are the most
troublesome (from the credit report you have already sent for), you then
start to create new conditions that you can then base your records on.
If you were out of work, perhaps you can get a reference from someone you
know who owns a business and is willing to say that you worked for him, if
the credit card company checks your references.
If your bills are too high, and you've missed a few payments, perhaps you
should see one of the free consumer- counseling services that are
springing up in the larger cities which will enable you to consolidate
your debts into a manageable amount.
Remember that credit card companies don't care very much about the amount
you owe, but they care a lot about whether you pay steadily, every single
month, even if the amount each month is small, and the entire debt will
take years to pay off!
Don't overlook ways to establish good credit without buying anything!...
For example, you have telephone service in your own name, you have a
record of paying bills to them which is then part of your credit record.
The same for your gas and electric supplies from you local public
utilities. These services, when they are in your name, will show
prospective merchants that you do have a record of paying bills, even if
you haven't yet established retail store or bank credit.
Using Your Credit to Save Cash!
The world of credit has one more trick you should know about, this one
that actually saves you money right on the spot.
All you have to do is carry your credit cards with you when you go out
shopping, even if you intend to pay by cash. Then you have to keep an eye
open for the smaller, personal service-type shops, where the boss himself,
or one of the partners, is always present (you'll see why in a minute).
As you walk in, check out the decals on the door to see which credit cards
they accept.
Then select your purchase in the way you normally would - taking your
usual care to be sure you're getting the right item at the right price.
When the deal's all set, produce your credit card (one of those you know
he takes), and say "I'd like to charge it, please!"
At this, the merchant's face will probably drop about six feet, but he'll
take your card and walk over to the imprinting machine (or maybe to the
telephone to check your credit status).
He hasn't got much choice, he has to take your card if he uses their decal
in the window. But the point is, he hates to, because he has to pay the
credit card company a percentage of the sale, usually somewhere between 6%
and 10%.
Now, while he's vulnerable, is the time to hit him with a casually dropped
remark like "say, how about knocking 5% off the price, and I'll pay cash
instead?" The chances are he'll accept your offer, because it saves him
the other part of the credit card company percentage, and because it saves
him bookkeeping chores, and waiting from 3 to 7 days for his money to be
credited to him by the credit card company.
The reason why this gimmick doesn't work in big stores is that the clerk
doesn't give a damn what it costs the boss, and has no authority to take
an additional percentage off the price, so he'll just go ahead and write
up your credit card invoice.
Copyright © Andre Vas, Direct-Credit-Card.com, All Rights Reserved.
Here's a GREAT FREE resource with everything you'll EVER
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and applying for the BEST one:
==> http://www.Direct-Credit-Card.com
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