Category: Credit Tips

Posts related to Credit Tips

A couple looking over bills piled on a coffee table.

There is no worse feeling than having a vehicle repossessed. Watching a car get towed away due to nonpayment or, worse, waking up to find your vehicle missing from your driveway is an awful experience. Coupled with the fact that you now do not have a car, people can find themselves in a terrible situation very quickly. There are ways forward after a vehicle gets repossessed and there is a possibility you may be able to finance another rather quickly, but a history of repossessions can be a major credit hurdle to overcome.

WHAT IS A REPOSSESSION?

Whenever you finance or lease a vehicle, you sign a contract between yourself and the lending company. This contract stipulates the amount financed, the term it is financed for, interest rates, and other financial terms. Purchase agreements also include provisions for the lender to recover costs and expenses should you default on your payments.

If you should ever [...]

Three credit cards stacked on top of eachother.

These days it seems plastic is king. With products like ApplePay, Google Pay, Zelle, Venmo, and CashApp it is fast and convenient to move (and spend) money without ever touching actual cash or change. Consumers in the US have become more reliant on plastic, in particular credit cards. A study from September 2020 shows that 70 percent of Americans currently have a credit card. The same study shows there are 1.06 Billion credit cards currently in use nationwide, an amazing statistic.

But when it comes to using a credit card, most people fall into two categories: using the card for everything or using the card for nothing. As with most things in life, balance is important. If you’re using a credit card for everything, you can land yourself in a revolving credit nightmare with an increased chance you won’t be able to meet all of your monthly bills. If you have credit cards but don’t [...]

Stack of money and toy car on table

Value is important now more than ever and if you’re in need of transportation, buying a car on a budget is a must. There are several factors that must be considered before any large purchase, but vehicles often come with additional expenses you may not be aware of prior to buying.

FIGURE OUT YOUR BUDGET

The first step in buying a car on a budget is to figure out what you can afford. Vehicle cost aside, you have to figure in maintenance expenses (oil changes), possible future larger repair costs (tires), insurance expenses, and even how much you’ll spend on gas. 

For general maintenance, AAA estimates budgeting around $100 per month. This includes oil changes and tire rotations and allows for a cushion for future unexpected expenses. If you purchase a vehicle that comes without a warranty, its a good idea to set aside more savings in case of a major repair being needed – [...]

A young couple sitting at the kitchen table looking at bills.

When it comes to debt, there are all sorts of numbers that get thrown around. Interest rates, credit scores, fees. It can be dizzying. There are two terms that sound similar to each other and are often confused, but which are nothing alike. Those terms are debt-to-credit ratio and debt-to-income ratio. Let’s take a look at these two terms and see what they’re all about.

Debt-to-credit ratio looks at the relationship between the total amount of credit you have been offered, also known as your credit limit, and the amount of money you’ve borrowed so far. Basically, it’s the percentage of credit that you’re using. For example, let’s say you have a credit card with a limit of $2,000 and you’ve charged $500 on that card.

$500 / $2,000 = 0.25 or 25%. Your debt-to-credit ratio is 25%.

You can calculate this number for your total amount of debt (add up the balances on all your cards) compared [...]

Younger man holding a set of car keys.

When you have bad credit, lenders will need to look at factors other than your credit score to determine if you meet the eligibility requirements for a loan. For example, lenders want to know that you can afford the car you want to buy. At CreditYES®, we look at your monthly income to help determine your eligibility. You’ll need to earn at least $1,500 per month before taxes to qualify. But there’s a little more to it than that.

Your lender will also want to know how much of your income is already being used for debts. This is known as your debt-to-income (DTI) ratio. This would include such items as housing payments, student loans, credit card payments, and other loans. Your debt should ideally not use up more than 35% of your income each month. You can learn more about debt-to-income ratios and how to calculate them by reading our blog post about DTIs here.

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