As the economy begins to show signs of recovery, a large part of the people negatively affected by this crisis also begin to emerge from their problems. Whether due to a layoff or investments that greatly lost their value, a substantial number of Americans faced financial difficulties in 2009.
As the calendar marches toward a new year, many people are looking for ways to better control their financial affairs, hoping to be more prepared if another recession rears its ugly head in the future. One of the best ways to prepare is to properly manage your credit, which can be accomplished in multiple ways.
Many people know that they have a credit score, but they do not know what it is or how it is determined. Credit bureaus like Experian and Equifax can provide credit history to anyone who requests it, but that's only half the process. The other half is the reason you have that history.
Obtaining secured credit cards involves a careful and meticulous search on the part of the customer, but can be an effective means of recovering credit, even with a poor or minimal history. The secured credit card requires the cardholder to deposit a certain amount of money with a lender, and the credit limit is generally equal to the amount deposited.
A good credit history is not only based on the way a person handles their credit card payments. The monthly payments on bank loans for car purchases, personal loans or even mortgages, if paid on time, also have a positive influence on the credit rating.
Although it may seem that obtaining a joint loan is not ideal for those hoping to give their credit score a boost, it is, as long as the payments are made on time and the account is settled seriously. Parents often serve as guarantors for their children, allowing them to use their good credit history as a cornerstone to create their own score.
Before granting credit, lenders analyze the stability of the applicant. Something that is true in today's economy, where lenders who made irresponsible loans to unqualified borrowers ended up going out of business or needing federal help.