By John Ulzheimer
1. Don't apply for credit unless you need it. And make sure you have a conservative definition of the word “need.”
2. Use credit cards as a 30-day, no interest loan that must be paid in full by the due date.
3. Don't apply for a loan without understanding all of the terms of the deal including interest rate, introductory periods, grace periods, universal default policies, credit score requirements, primary credit bureau used, and credit bureau reporting policy.
4. Don't ever apply for credit in exchange for a discount on your purchases or a free coffee mug or T-shirt. Your credit report is a not a “10% off” coupon.
5. Be careful when taking advantage of in-store financing offers. “No payment for 24 months” isn't a good idea.
6. Pay off your credit card balances in full each month, no excuses. If you can find the money for cable, cell phones, beer, football tickets and cigarettes then you can find the money to pay off your credit cards.
7. Use debit cards instead of credit cards, you'll spend much less.
8. If you can't write a check for it, you probably shouldn't buy it.
MORE WEB EXTRAS FROM JOHN
- Q&A with John: Should I Consider A Debt Reduction Company Solution?
My question is regarding debt consolidation verses debt reduction. I have a fico scores in the mid 700s. I have about 25,000 in credit card debt. I am very fortunate to have very low rent, so I don't own a home. However, some day I want to have a saving and I want to own a home. I have an excellent career, working for the county, so I have benefits and make about $70k a year.
- Q&A with John: Should I Declare Bankruptcy?
Question: divorced 6 months ago, bought home instead of renting, now 75,000 in debt, own concession business, seasonal, make 25,000, 6mo saved money for winter months and work pt, cant find any jobs that pay halfway decent, truck was repoed 2 days ago, owed 26,000, worth only 17,000, need truck to run my business...
- Q&A with John: Can Mistakes from Ex-Spouse Affect Us Negatively?
Question: My Fiance' & I are hoping to buy a home this summer. He was divorced last year & his ex failed to get his name off of the deed within 7 months of divorce & also failed to make payments on time. Will this affect us negatively with the bank? Also would it be best to take a large amount of money we have saved to pay off any debt, or use it all for a down payment.
- 10 Steps to Better Credit
Find out what the credit reporting agencies are saying about you - Step one to addressing the problem is finding out just how bad of a problem you have...
- 8 Tips on Avoiding Debt
Don't apply for credit unless you need it. And make sure you have a conservative definition of the word “need.” Use credit cards as a 30-day, no interest loan that must be paid in full by the due date...
- Top 12 Credit Myths
Myth 1: Close credit card accounts if you're not using them because it will improve your credit scores. Myth 2: Avoid credit after a bankruptcy or some other credit disaster. Myth 3: Paying your bills on time is the best way to get a good credit score...
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