Using credit cards when your financial situation is poor... is it wise?
Some people claim to know how to get good credit by using good, secured credit cards. It is possible, or rather, feasible. What they do not tell you is the risk they take. They do not mention either how sound their economy is, how well they know how to distribute their cash and other things that are overlooked by the common credit card user.
No Details
I will not go into the details of how they do it, except that it is performed because credit card accounting and control are done digitally, through software that has no eyes, no heart, no feelings.
It allows or it does not . And whatever it allows you do, irrespective of what risks you get into, you do. And if there should be a whiff of suspicion in someone related to the control of this kind of operation, you are done for.
What Risks?
First off, the situation: You have bad credit and you want to use credit cards to build up good credit ratings. There is an essential question to ask here. Why are you in debt? Whatever the fine tuning is, the reason is that you have spent more than your earnings.
You have got into a vicious circle of spending ahead of time, just because you have credit. This means that you have grown used to this feeling until the choking hand of collectors began to get at you. Will you just change it overnight in order to apply some magical credit card formula? I have my serious doubts. At least, not as fast as all that.
It Takes Time
If you are disciplined enough to carry out a fancy process of rebuilding credit through your Credit Card’s (you need more than one to do this juggling), you are also disciplined towards your spending. What they really use that for is to be able to make business.
They rake up capital to resell whatever they buy with a good profit. So, there is no way you can build up a good credit and maintain it if you are not disciplined.
It Seems Tempting
Changes in human behaviour have to be kept for long enough to be considered an acquired trait, a lesson really learnt. So, until then, we recommend a safer way of doing things. If a building falls to bits, how can we build it up again? Brick by brick, beam by beam.
So, Start Over, A Little At A Time
Get whatever loan you can, for a small amount, make it easy to pay back. Use it for something worth while, something that you would not normally buy with the surplus of your salary. As soon as you have a couple of months paid, check on your credit report and make sure that the new info is on it.
Use The New Report
Use the new report to get another loan, even for the same amount or similar, but that you can pay back without difficulty. This is how you can build up a good credit rating, without getting into any unnecessary risk. The next step is to get a bigger loan… or wait until you really need one.
An Interesting Aspect
A loan gives you cash. More than you could ever get from a normal salary. Now, my friend, I will leave you some homework to do: Find out what real investment you can do with a loan. Study your part well, calculate the risks, and perform.
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