Have any of your visitors or subscribers filed for bankruptcy in the past? If so, they should read this article because it tells them the three most important things they need to do before applying for credit or loans.
A lot of people who have been bankrupt in the past don't know how to apply for credit right.
They put in an application for credit and hope for the best. In the best case, they might end up paying hundreds or even thousands of dollars more in interest and other fees, depending on what they buy.
So, in this article, we'll talk about how to apply for credit and loans the RIGHT way. What is it then? There are three steps, though:
- Know how credit is given out
- Know how to get loans and credit
- Figure out how to get your credit score up.
Now, you need to do these three steps correctly. Not one or two, but ALL THREE! See, if you miss one or don't do it right, you could end up paying extra interest and finance charges of $100, $1,000, or $10,000, depending on what you're financing.
Here's more about the three steps...
Step 1: Find out how to boost your credit score.
Raising your credit score is one of the most important things you can do to get loans and pay less interest on them. There are a lot of false beliefs out there that can hurt your credit score.
You can improve your credit score in a number of ways. One way is to keep an eye on how much is on your credit cards. Lenders don't like it when they use more than 50 percent of the credit limit they have.
For instance, if your credit limit is $3,000 and you owe $1,800 (60 percent of your limit), that can hurt your credit score. There are two ways to solve the problem in this case.
First, you should pay down the balance until it's less than 50% of the credit limit. Another option is to get your credit limit raised:
If you can get your credit limit raised to $5,000, you'll be using less than half of it ($1,800 balance divided by $5,000 credit limit). And you didn't have to pay anything toward the balance.
Adding years of good credit history to your account is another way to raise your credit score. Few people know about this, but it is completely legal. But that's a whole different story.
I want to get across that there are many ways to improve your credit score. The best part is that many of them can be done quickly and without much trouble.
Step Two: Learn how credit is given.
What do people who want to lend money look for? You need to know what questions to ask in this case. For instance, do they help people who have filed for bankruptcy before? How low do they want your credit score to be? These questions are just the beginning.
There are other questions, too. There are also some things that, if a lender sees them on your credit application, will raise red flags. These things could hurt your chances of getting the loan or cost you more in interest.
Timing is another thing to think about when applying for credit and loans. You shouldn't apply for credit or loans until your credit score has gone up (most people make this mistake).
Now we're ready for step three...
Step 3: Learn how to ask for loans and credit.
It's also important to know which lenders to talk to and how to negotiate with them.
If you go to the WRONG lender for a loan or credit, you're almost certain to be turned down or end up paying a lot of interest.
Then there is the process of making deals. This is especially important when you're buying a car. For example, people will spend a lot of time negotiating the price of the car they're buying and the value of their trade-in (if they have one), but they'll still be taken advantage of. They don't really know how to talk about a car.
Consider it. When did you last buy a car? Probably once every few years, if you're like most people. Now, how many times do you think buyers negotiate with a busy car dealership every day? When you add up the days, weeks, and years, you can see that they have a little more experience.
You should now know how to apply for credit the RIGHT way after a bankruptcy. Even though I couldn't go into detail about ALL of the ways you can improve your credit score and get loans and credit at better rates, this should at least give you a place to start.
