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I have several credit cards are a temptation in my pocket, what effects can bring me cancel?
Cancel the cards just for the sake of not wanting to use them is a bad idea.

First of all, can negatively impact your FICO score. One of the most important calculations used to determine your score is the ratio of the money you owe on your cards and the spending limit you have. By canceling the cards, that relationship changes negatively.

For example, if you have 5 cards with $ 1000 limit each, have a $ 5,000 limit ($ 1,000 x 5 = $ 5,000). If you owe $ 750 between all the cards, the relationship between what you and the limits are 15% ($ 750 / $ 5.000 = 0.15 = 15%). If you decide to cancel 4 of the cards to avoid temptation, then the ratio rises from 15% to 75% ($ 750 / $ 1.000 = 0.75 = 75%). That looks very bad because it appears you manage your finances so badly that just to cover your living expenses you have to use most of the credit available to you. This lowers your FICO score.

Better to have unused cards in a difficult place to get them.

Also do not forget that many banks are taking the decision to reduce the limits available. So maybe canceled your cards and then you’re left with the only limit you reduce and stay with unlimited card available.

Credit cards themselves are a temptation for many people.

I can give you much advice about how not to use them, but the truth is this: if you make the decision-heart-to improve your financial situation, so any advice will be served. We’re not talking about having the money for an emergency. But simply “want” to buy things or go out and not have the money as you want to pay with cards. It really is not a responsible decision.

Before the economic crisis make a dent in the economy of our homes, many banks and granted the credit card regardless of credit history too much on the applicant. Now the picture changes: if you request a credit card with all the bank security consult records of debtors to check if we have not paid into force. Where figuremos in one of those records, forget that you give your credit card.

This has led to a new business: small financial and even individuals who are dedicated to gestionarte granting the credit card ASNEF .Usually they also offered to gestionarte log output of defaulters. It is important to note that out of ASNEF not easy. If the inclusion of our data in the records of defaulters was not due to an error in the vast majority of cases we pay off the unpaid. These companies then offer a personal loan at very high rates or mortgage to pay off debt and get out of ASNEF.

The best option is to try prevent by all means you include in a register of defaulters. If your financial situation may cause delays in payment of your debts, go to your bank as soon as possible and requests that you consider a debt consolidation.

Note that any funding you request (personal loans, credit cards, mortgage loans) being in ASNEF will be much more expensive in every way: fees, interest rate, etc.. Also ask for a credit card ASNEF is not the best solution if your economic situation has caused your inclusion in ASNEF, you should not increase your debt. A debit card should be enough to control spending and trying to recover from the economic downturn in which you fell.

Below, we list the 5 things that you can not take into account on your credit cards.

1. Use them with care.
The credit cards offer many benefits, the main one is the ability to buy now and pay later. However, care must be to keep debt levels manageable , otherwise, the expenses relating to interest and fees can be very high and affect our credit history also destabilize our of personal finance.

2. Select them carefully.
Today, it is common for credit card vendors offer gifts (such as shirts or sporting goods) in return that you accept those cards, or else, they often offer cards with no annual fee. Be careful not to accept them to get that something back, of course, to have more cards (not need) encourages borrowing habits.

3. Pay what you can.
To minimize or avoid interest stakes , try, if possible, pay the debt in full each month. Remember to pay only the minimum each month means you’ll be paying a lot of interest for many years, and that these, exceed, in multiples, the original amount of purchase.

4. Pay on time
Paying the credit card on time, avoid paying commissions and interest, but more importantly, avoid being reported to the credit bureau as a person with financial problems, leading to a drop in your credit score, and this could cause your bank decides to increase you the interest rate on your card or you reduce you the maximum credit limit, and in larger cases, could even cancel your card. Read the rest of this entry »

If you have a debt large or many debts, sure you’ve wondered if some day be free of it but above all, what a way out of debt?

First, it is not following tenderfoot. If you can not pay, do not get into debt unless a medical emergency.

If you feel very stressed about the amount You owe, you need to calm down and remember that for every solution there and sooner or later, if you try, you’ll be debt free.

Consider the following steps on how to get out of debt:

1. Prioritize
What is most important to you, paying your mortgage, starting a business, pay for college? Or does extravagant vacations, trendy clothing, fun weekend? loans for mortgages, university or business, insurance is a good investment. The rest, avoid, especially if you take long to pay that debt.

2. Use your best judgment
Make sure that when you ask for a loan, the terms and conditions match your goals and your plans for how to manage your finances. There are several types of debt, and each has different interests and conditions.

- In the case of credit cards
If you pay your bills on time and in full each month, no matter if your credit card has a high interest rate, you’ll like even rewards card or you do not charge an annual fee. But if the contrary, you carry over balances and pay other loans or financing and you fall behind, then the interest rate does have importance, so you should lower card interest rate , even if you have other benefits.

- In the case of mortgages
If the loan is that you are applying for the mortgage of a house, the type of mortgage you apply affect the interest rate , mortgages can be with an adjustable rate or a fixed rate. Again, it is best to decide based on your financial planning. If you are planning to sell the house soon, an adjustable rate mortgage, which is lower, can suit you. But on the other hand, if you plan on staying in the house or can not afford payment increases if interest rates rise, then it is better to choose a fixed rate mortgage term.

3. Eliminates high-cost debt.
If you are looking for a way out of debt , we recommend that you get rid of the debt with interest rates very high. Try changing your interest rate to a lower dialogue with your lender or banking house. If your debts are high interest credit card, you can search card interest rates lower and transfer your debt , just be careful that the rate you’re offered an incentive not only to last a few months. If your debt is large and you own a home, you have the option of requesting a loan with a low rate by placing a mortgage to consolidate those debts of high rates.

4. Pay your debts
Whenever you ask for a loan or credit notice the interest rates , and whenever you are thinking about you late on a payment of debt , remember that interest charges are not a good use of your money. So look for ways to pay before the deadline. If you can not pay the monthly amount of your credit card, pay more than the minimum, as much as possible, so you will pay less interest. Do not forget to pay your debt requires discipline and sacrifice.

5. “I have not a penny to pay my debt”
The less incur in new debt , the quicker you can be debt free . If you’ve reached a point where you can not afford even the minimum amount of your credit card, it’s time you stop using it or destroy it. But do not stand alone in this, contact your creditors to reschedule your payment, explain your financial situation and your intention to pay what you owe. They can help you.

6. Make sure your checks do not bounce.
If you are using checkbook , before issuing a check , check your statement to make sure that they deliver the check has funds which paid. In some places, it is an offense to deliver bad checks and you can get into a bigger problem than not paying your debt. In addition, all banks charge fees for bad checks between 10 or 20% of the amount of the check.

7. Asseverate
In each country, there is a body which regulates and analyze suppliers of goods and services, lean on them to select your creditors. In Mexico is the Federal Consumer Protection Agency and the U.S. is the “Federal Trade Commission.” Select a creditor is not a task that should be taken lightly, and always keep in mind that if it sounds too good to be true, most likely not be.

We hope these tips on how to get out of debt help you on your way to resolve them.

Now consumers can know in advance whether they will increase the interests of their cards and how soon they pay their debts. Find out facts

This February, 2010 came into force a new law that gives new protection to people who have credit cards. The following highlights the most important information about the four most important changes:

1. Do not increase the interest for 1 year
The new law says that credit card companies can not increase interest during the first 12 months after opening an account with the following exceptions:
• If the card has a variable interest
• If is delayed beyond 60 days to pay your bill
• If you miss a payment agreement with the lender
Also, if a company offers an introductory interest, it must remain in effect for a minimum of six months. At the end of that period, interest may rise to the level that you agreed with the company to sign the contract.

2. I have to warn people before turning up the interest
An important element of the new law is that credit card companies should notify 45 days before increasing interest rates or change some major changes to the contract.
If the creditor (the company that gives credit) decide to make changes to the contract, should give you the option to cancel the card. But beware: if you cancel the card, the company may close your account and increase your monthly payment.

The company is not required to send a notice of 45 days if:
• You have a variable interest
• beat introductory interest period and up to a preset level and
• Did not meet the payment agreement with the creditor

3. There will be more transparency in billing
invoices now include information on how long it will take to pay off your debt if you only pay the minimum.  Also tell you how much you need to pay monthly to eliminate your debt in three years.

If you were to be practical, begin and end this article with one sentence: Grab your credit card and cut it in half.

Now we all know that things are not so easy, and less in times of crisis, and many we are already inside the wheel malignant passively incorporating these devices of the devil, the credit card .

For those who have never stopped to think about how these matters is simple. Everything is based on the idea of spending money you do not have . At one point, you wanted to buy a plasma TV, or you have not received to cover the cost of textbooks, and before resorting to cheaper solutions but embarrassing, like asking for money loaned to a friend or relative, you succumbed to the battery bank promises that everything is ready when it comes to selling the product.

Well, it’s natural that once you start using it, not find a humane way to stop without spending really big deal. You use the credit card to cover the expense, and you cover the card following the day of the month, which takes you to have to use it again at the end of next month, and so again and again. Obviously there are other ways to cover the expenditure that is more comfortable on the wallet and in times of crisis, but we’ll see how in the end is the worst option.

Surely not I’m telling you anything you do not know, but my idea was to encourage reflection today. So I put a quick example of the initial price of an item and the amount will end up paying when you finish to cover the cost of the said card.

To see an example, we assume that you buy a 500 euro and you decide to pay a minimum monthly payment by 10% (50 euros). You must also take into account a monthly effective interest rate of 3% plus VAT of interest plus 5 euros in management expenses it charges the bank.

Under these assumptions should be made 14 payments of $ 50 plus one of 26.91 euros to cancel the debt of 500 euros, giving a total of 726.91 euros. This is because contrary to what many of us can imagine when we say that we always pay the same, paid 50 euros each month, 15 are intended to pay interest (3% of $ 500), VAT on interest represents 3 , 15 euros and 5 euros are the other senior management position, so that the debt falls only 26.85 euros, not 50, with the new balance of return of 473.15 euros instead of 450. This process continues month to month, and the effect of expenses, taxes and interest, rather than 10 payments of $ 50, must be the 15 payments discussed above. So, having been paid the tenth payment of 50 euros, the balance of the debt is still 183.11 euros, but you’ve already paid $ 500. I do not like a plan.

Obviously, if you decide to pay more each month the total amount payable decreases, and you can cancel the debt with a single, but many organizations have charges to apply in this case, forcing you to pay a “fine” to cover the money they expected receive the payment of interest on the loan.

As already mentioned, in an ideal world we should get rid of these cards, but we understand that being moderate is not a bad idea to have some out there to cover unexpected expenses or surprises many, but certainly never to be used as standard.