Dear Penny,My mechanic just told me my 16-year-old car is a fire hazard and that my only option is to sell it for scrap metal. I’ll probably get $100 for it.I have no money saved, and I’m recovering from wrecking my credit in college. But I need a car ASAP. Public transportation where I live is a joke, and my job requires me to travel across three counties.I know I’m going to have a high interest rate due to my bad credit, and I’m OK with buying an older used car. But I’m terrified of negotiating with a used-car salesperson. My parents worked out the terms of the deal when I bought this car as a teenager. I’m afraid the salesperson will sense my desperation — especially since I don’t have a trade-in and I don’t have much time to shop around — and tack on extra fees and interest.Any tips that will help me deal with a used-car lot?Sincerely,Carless and Credit ChallengedDear CCC,While we advocate for buying used cars and … [Read more...] about Dear Penny: I need a car, but my credit is awful. Will I get ripped off?
I have bad credit but need a personal loan
Q: Is it true that no credit is as bad as bad credit? I recently paid off my house and have no car loans. I use four credit cards every month, including one for automatic monthly bills. All are paid in full as soon as I get the bills. So practically speaking, I have zero debt. Am I making a credit history if I don't have debt? I had excellent credit scores before I paid off my house. A: You still do. You don't have to carry debt to have good credit scores. The myth that you do — that the only people with good credit are the ones in debt — is unfortunately a persistent one, typically spread by people who don't understand how credit scores work. Rest assured that using your credit cards lightly but regularly, and paying the balances in full every month, is the right thing for both your scores and your finances in general. Your paid-off mortgage should remain on your credit report for years to come, and it will continue to help your scores. Scoring formulas … [Read more...] about Liz Weston: Do you have to carry debt to have good credit?
Robert Powell Special to USA TODAY Published 11:43 p.m. UTC Jul 18, 2018 Question: I’m 64. My credit score is about 656. For different reasons over a long period of time — including unemployment and health issues — I accumulated credit card debt of about $50,000. I intend to take out an unsecured personal loan, but I don’t want it to have a negative impact on my credit score. I have a job now and I will pay my monthly payments on time. But what will happen if I cannot continue my payments to the lender? If I should file for bankruptcy, which is worse: defaulting on credit card debt or an unsecured personal loan? If I try to negotiate a reduction of my debt with the creditors, do you think this procedure will be successful and not take too long? And what is a nonprofit debt relief company/agency, and how could they help me? Bottom line: What strategy would you implement to resolve the debt problem if you were in my … [Read more...] about How do I get out of $50,000 in credit card debt: personal loan or repayment plan?
Credit scores are needed to qualify for a car loan or mortgage. And the way you establish a credit history is by getting a credit card, right? That's a familiar personal finance myth that has led millions of Americans to get their first credit card -- and risk falling into high-interest debt, experts say. The average American in 2017 had two-bank issued credit cards and carried $5,551 in debt, according to the credit bureau Experian. Collectively, Americans have $1 trillion in credit card debt, more than any country in the world. Here are four ways consumers can create a credit history without falling into the credit card trap. Report monthly bills like rent and utilities Bills like rent and utilities traditionally aren't used to create a credit history – only loans are. But new companies and scoring models are springing up that include monthly bills like rent, said Robert Harrow, a credit card specialist with ValuePenguin. Those bills include rent, cell phone, internet, … [Read more...] about 4 ways to build good credit without using a credit card
Carmen Reinicke CNBC Published 6:00 p.m. UTC Jul 9, 2018 You've watched your children or relatives celebrate college graduation, move to new cities and start first jobs. You might be settling into life with an empty nest, or simply enjoying one less person in the house. That is, until your child brings up student loan refinancing and asks if you will help by co-signing. Student loan debt in the United States has climbed to more than $1.48 trillion, a record amount. The average student loan debt for the class of 2017 was nearly $40,000, according to Student Loan Hero, an online resource for managing student and personal debt. This represents a huge financial burden for 44.2 million Americans and can take years to pay off. More: Borrowing for college? 3 ways to avoid getting trapped in a bad student loan deal More: How some students are lowering or avoiding college tuition and student loans More: Student loans have become our modern-day debtors prisons Currently, interest … [Read more...] about Piggybacking on good credit: Things to consider before co-signing a student loan