Credit Card Report
Financial News Made Easy

A collection of news and information articles about all things credit:

Credit Cards

• Navigating the deluge of credit cards

In a country from which there are hundreds of credit cards to choose, picking one that best suits your financial needs and lifestyle is no easy task.

There are cards that offer rewards, cards that tout low interest rates and cards that have no annual fees.
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“If it sounds too good to be true, you really have to take a look at it,” said Noelle Fischer-Herbert, vice president of corporate development at Pacific Service Credit Union in Walnut Creek, Calif.

How current a consumer is in keeping bills paid off is a key factor in deciding what kind of card best suits a person.

Consumers who use credit actively and pay off their balances every month might want to consider a rewards card.

“While interest rates are important, it does not really factor in because they are paying the balance every month, so, in theory, there is no balance to carry the interest on,” Fischer-Herbert said.
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Financial Management

• Arm Teens With Good Credit Skills

From the minute teen-agers step onto college campuses, they are bombarded with offers of free T-shirts or airline miles from credit-card companies seeking their business. By the end of freshman year, the average student has racked up $1,500 in credit-card debt, according to college lender Nellie Mae.

To help your child avoid the pitfalls of credit, teach teens credit-management skills early, while they are still at home.

There are various choices for your teen’s first plastic, including debit cards and prepaid cards as well as traditional credit cards. At whatever age you feel appropriate to assist your child in signing up for a card, make sure you explain that “credit is a tool of convenience, not an extension of income,” says Kim McGrigg, spokeswoman for credit-counseling firm Money Management International.

Establish clear guidelines for monthly spending limits and items worthy for credit-card use, and also be clear on which of you is putting up the cash.
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Car Loans

• Owing more on your car than it is worth

The easy-credit binge that left many homeowners with foreclosure headaches also has strapped many car buyers with long-term loans on depreciating assets. In auto industry parlance, that means many people are upside-down in their cars and trucks, owing more on them than those vehicles are worth.

The situation isn’t new. In many ways, it is the natural consequence of borrowing money to pay for something that loses value the moment it is put into use.

But auto dealers and manufacturers interviewed at the North American International Auto Show in Detroit last week and at the Washington show say the problem is getting worse.

Traditional 36-month car loans are traditional only for consumers with the highest FICO auto loan credit scores, dealers say. That means people with credit scores of 700 and above and people able and willing to make hefty down payments, 18 percent or more, on their loans.
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Divorce and Credit

• Safeguard your credit in divorce

If you’re planning to file for divorce this year or are already splitting your assets with your soon-to-be ex-spouse, your credit is likely to take a hit.

Many people don’t realize lenders do not honor court decrees that assign payment responsibilities for joint loans. The mistaken assumption that you’re off the hook for financial obligations can result in a series of missed payments that may trash your credit score for years.

This needn’t happen if you safeguard your credit before you file for divorce. Consider these tips from John Ulzheimer, author of “You’re Nothing but a Number” and an expert at Credit.com, a consumer personal-finance site.
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