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6 Infuriating Ways You’re Ruining Someone Else’s Credit

Your credit score is one of the biggest deciding factors in your financial health. It influences whether you qualify for the best interest rates on mortgages or auto loans, it can impact your insurance rates, and it can even determine whether you land that dream job or not.

Establishing good credit requires managing your credit accounts responsibly. But your own credit score isn’t the only one that can suffer the consequences of poor credit management. In the same way money can ruin a friendship, your financial carelessness could ruin someone else’s credit. Here’s how.

1. Charging up someone else’s credit card

Becoming an authorized user on someone else’s credit card helps build your own credit history. You’ll receive a credit card in your name, and you’re allowed to make charges on the account. But even though your name is on the card and the account shows up on your credit report, only the primary account holder receives the statements. This person is ultimately responsible for any purchases you make with the card.

If you’re an authorized user, the mature thing to do is pay whatever you charge each month. If you don’t or can’t pay, this sets in motion a chain of events that could ruin the other person’s credit.

Any purchases you charge to the account can raise the primary account holder’s balance and increase their credit utilization ratio beyond a healthy range (utilization ratio is the credit card balance compared to the credit limit). Ideally, credit utilization should never exceed 30 percent of a credit limit — the lower, the better. A high utilization ratio can lower credit scores.

In addition, ringing up charges on someone’s credit card and not paying what you owe could trigger payment problems. This can happen if the primary user doesn’t have enough money for higher minimum payments. If they can’t pay the credit card bill within 30 days, the credit card company could report the late payment to the credit bureaus. While a 30-day delinquency won’t tank a credit…

5 Providers of Debt Consolidation Services and Loans for Businesses

Debt Consolidation Services

Business and entrepreneurship in particular is among the riskiest endeavors you will ever take. Most of the time, you find that you have a unique business idea and a ready market. Things look up and to generate more revenue, you may choose to use your business credit card or take up a few loans just to finance and to build your business.

Unfortunately, there is an economic crisis, and you are unable to repay your loans and your sales drop. What do you do then? File for bankruptcy? Of course, this is the first idea that will cross your mind, but it may not be the best way out for you.

There is a better alternative – debt consolidation.

Debt consolidation refers to the putting together all your existing loans and credit card debts into one. Basically, you will take up a loan to repay your loan, now consolidated into one unit with a lower interest rate. The one big loan taken up pays off all your existing loans and credit debts and you will have one loan to service.

Your business is eligible for debt consolidation if you have several creditors breathing on your accountant’s neck monthly and when you need a better system of repaying all your creditors.

The first step is to determine the amount you owe against the amount you have or what you can afford to repay monthly. Choose a plan[1] that will work well for your business. After that, you should find a company or a reliable debt consolidation service provider. There are various service providers, but the main ones include:

1. Online debt consolidation companies/peer-to-peer lenders

There are many of these nowadays and you may be stuck on which company to choose, especially when inexperienced. As a rule of thumb, research, review, and ask, even though online businesses have debt consolidation loans[2] made easy. Your financial counsellors, colleagues, or acquaintances will guide you in the right direction. Some of the leading online debt consolidation loan companies include:

  1. LendingClub: This is one of the nation’s biggest peer-to-peer lenders. If your business’ credit score is strong, then you will enjoy debt consolidation services at low interest rates from this online entity. Their rates are easy to understand and calculate because all the necessary items are described clearly. The LendingClub has been accredited and you can trust…

8 Ways to Build Credit Even as a Student

Between classes, extracurriculars, and social activities, most college students have no trouble staying busy. Building credit may be low on their list of priorities, but that doesn’t mean it’s too early to start thinking about it. Being mindful of credit as a young adult can make it easier to land a car and a place to live, and secure lower interest rates on loans. Here are some steps that will set you on the path to stellar credit for the times when you need it most.

1. KNOW YOUR CREDIT SCORE.

The first step to building excellent credit is learning your credit score. Even without car payments or credit cards to pay off, anyone with student loans will have a credit history. A federal law makes it easy to check credit reports from the three main reporting agencies online. Annual reports are free, but according to a recent survey only half of college students take advantage of them. Having an idea of your credit score isn’t the only reason to check it: The report may contain mistakes or traces of fraud you weren’t aware of. Staying on top of your credit status means you can take care of any complications before they become an issue.

If you haven’t been checking your report because you’re afraid doing so will lower your score, fear not: When you check your score yourself, you’re initiating what’s called a “soft” credit inquiry. These kinds of inquiries do not have an adverse effect on your credit score—only the hard inquiries conducted by financial institutions do. (Generally speaking, a hard inquiry can only happen with your consent.)

2. FIND THE RIGHT CARD.

Contrary to popular belief, using a debit card exclusively isn’t a savvy financial move. Responsible credit card use shows credit agencies that you can be trusted to make payments on time. But deciding that you want an extra card in your wallet is half the battle—next you’ll need to narrow down your choices. First and foremost, compare the interest rates on different cards—the lower, the better. Next, consider the extras. Some companies offer cards designed for students with perks like rewards for good grades. Not every student will qualify, however—especially those without any income or bad to nonexistent credit history. If this sounds like your situation, a secured credit…

A Few Surprising Facts About Student Debt

Americans’ accumulated student debt has topped $1.4 trillion, an all-time high. While that debt came in the service of providing valuable education, it can be a formidable hurdle for individual workers to overcome as they transition from student life into their careers. Check out nine surprising facts about the past, present, and future of the academic loan industry.

1. SCHOOL WASN’T ALWAYS SO EXPENSIVE.

After World War II ended with an Allied victory, the U.S. government rewarded those who served with scholarships under the GI Bill. Millions of veterans got a free education, while millions more who didn’t serve could attend for extremely low tuition rates that could be covered by working a summer job. This kind of nearly unrestricted access continued for decades until the economy took a downturn in the 1970s. As oil embargoes and inflation led to a sharp increase in tuition, private lenders started to take the place of federal aid, and the debt boom began.

2. DEBT HAS SURGED 58 PERCENT IN THE PAST 10 YEARS.

It’s easy to blame inflation for the ballooning student debt balances of the past decade. Graduates in 2005 owed an average of $17,233, while those exiting school in 2012 owed an average of $27,253. But average debts in the auto and credit card industries have fallen in the same period. The difference? Economists believe students have become more likely to take on higher loan amounts in the belief they’ll be able to secure higher-paying jobs after graduation. Unfortunately, those jobs can fail to materialize, leading to growing amounts of debt.

3. …BUT MOST DEFAULTS ARE ON LOANS LESS THAN $10,000.

Economists say that it’s a misconception that enlarged debt amounts are responsible for many of the defaults. By some estimates, two-thirds of delinquent loans are for $10,000 or less. Surprisingly, totals of less than $5,000 make it eight times more…

Things To Know About Paying for Grad School

Students attend graduate school to gain more knowledge in a specific field, increase their future earning power, or switch careers. But depending on the type and length of the program, grad schools can cost tens or even hundreds of thousands of dollars. Whether you’re planning to get your master’s, Ph.D., MBA, or J.D. degree, here are nine things you should know about paying for grad school.

1. START RESEARCHING YOUR OPTIONS EARLY.

If you know what type of graduate program you want to attend, start researching your options early. Different schools offer a variety of scholarships, fellowships, grants and department funding, and starting the application process early will increase your odds of receiving money from a university’s limited funds. After reading about your options on the university’s website, speak to a representative from the school’s financial aid department.

If you’re willing to spend more time earning your degree, consider taking classes part-time instead of as a full-time student. Depending on the program, earning your degree part-time may cost less than a full-time program, and you won’t lose a year (or more) of income while you’re studying.

3. DON’T OVERLOOK YOUR PROFESSORS.

If you’re currently in college, ask professors in your area of study to recommend relevant scholarships, fellowships or grants for which you could apply. Even if you graduated years ago, get in touch with your old professors to benefit from their knowledge and contacts. And because most scholarship applications require letters of recommendation, your professors can also help by vouching for you.

4. ASK YOUR EMPLOYER TO FUND YOU.

If you’re currently working and your graduate degree will be in the same field, check with your company’s human resources department to determine if there is a tuition assistance or reimbursement program….