Consumers Searching for Ways to Rebuild Their Credit

[Aug 7, 2007.]

This summer, a number of American consumers are looking for ways to rebuild their credit history. Such a goal is important, considering the fact that a less-than-stellar credit rating can cost you thousands of dollars in interest and life insurance costs.

But how can you go about restoring your credit worthiness at a time when high interest rates and sky-high gasoline prices may make it difficult for you to pay your monthly bills?

To begin with, financial experts say that, this year, obtaining a secured credit card can be the ticket to improving your credit score. You simply deposit cash as collateral and you begin to charge. If you make your payments in a timely fashion, your good credit can be restored. It's best if you can obtain a card that has no application fee.

Next, make sure you're paying more than the minimum monthly payment on your credit card bills. If you simply pay the minimum, you'll make little headway in retiring your balance and your overall credit score could suffer as a result. The more you're able to pay each month, the better able you'll be to attack your credit card balance. Also, make sure you're up to speed on credit card interest rates and shop around for the best deal. Through balance transfers to lower-rate cards, you may be able to save a great deal of money in the long run.

Another sound financial strategy this summer is to do a quick check of your credit report. Inaccuracies on your report could actually end up costing you money. That's because negative entries can cause creditors to charge you higher interest rates. In order to obtain a free credit report, visit FTC.gov.

Of course, in order to improve your credit score, you'll have to exercise patience. That's because derogatory information can remain on your credit report for as long as 7 years.

Julie Ann Amos
August 7th 2007

Recent News

• Wells Fargo Posts Rise in Profit
  Wells Fargo, one of the nation's leading providers of home loans, saw its second quarter profits rise 9%, despite the difficulty that some consumers are having paying their mortgages this year.


• Debit Card Use Can Yield Some Unwelcome Surprises
  Debit card use has exploded in recent years, with consumers turning to the cards as a convenient alternative to writing checks.


• Consumers Question Credit Report Offers
  Some American consumers this summer are questioning "deals" offering copies of credit reports to those who pay for special services. While the practice is legal, experts say it may not be the best idea for a consumer's bottom line.[6th August 2007]


• Citigroup Sees Rise in Second Quarter Profits
  Citigroup Inc. is reporting an 18 percent jump in its second-quarter profit.[6th August 2007]


• Consumer Optimism May be Building
  Consumer optimism appears to be growing again, according to a Reuters/University of Michigan Surveys of Consumers. The optimism appears to be fueled by renewed hope in the job market and in salary situations. [6th August 2007]


• Home Construction Rises
  The troubled housing industry received some positive news recently with a report that new home construction increased 2.3% in June. However, enthusiasm was dampened by the fact that the new construction rate in May was revised downward. [2nd Aug 2007]


• Economic Growth May Be Lower Than Expected
  The head of the Federal Reserve Board is taking a conservative course when it comes to predictions about the economy—a move that's being applauded by some in the investment sector. [2nd Aug 2007]


• Inflation Concerns Continue
  It appears that members of the Federal Reserve Board continue to be concerned about the specter of inflation.[2nd Aug 2007]


• Fed Surveys Consumers About Credit
  The Federal Reserve Board has now released its report on credit card solicitations and applications. The findings are significant, since the study included personal one-on-one interviews with American consumers. [1st Aug 2007]


• Gaining Credit May Be Getting Tougher for College Grads
  A change in practices in the U.S. credit card industry may mean that it will be tougher than ever for college graduates to establish credit. [1st Aug 2007]


• Mortgage Rates Unmoved
  Prospective homebuyers received some encouraging news recently, thanks to the fact that rates on 30-year mortgages stayed steady. The decision to maintain the status quo might have been surprising to some, given all the concerns being raised about inflation at this point in time. [1st Aug 2007]