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Credit Cards: How To Repair Your Bad Credit



It’s a common misconception that credit card companies exist purely to make you money. The truth is, they’re in the business of making their own money and providing services to customers for profit. When it comes to bad credit cards, there are two different types: charge and revolving. With these cards (much like with any other type of loan) you’re taking on debt in the form of a line of credit that starts with your purchase.


The best way to build your credit score is first to understand how it works. It’s a three-digit number that was created by the Fair Isaac Corporation (FICO). Why do they have so much control over your financial life? Because lenders use FICO scores when deciding whether to give you a loan and at what interest rate. If your credit score is too low, the lender will reject you outright. Or they’ll charge you a higher interest rate to borrow money.

Your FICO score ranges from 300 to 850. A good score is typically in the range of 700–720. These are considered excellent scores and it may be easier for you to get approved for a loan. If your score is above 700 and you have no late payments, the lender may give you a better interest rate than people with lower scores.

So what can you do to improve your score? Keep reading to find out.

How Do You Get Bad Credit?

There are a few different ways you can get bad credit, and it’s typically all because of spending habits. For example, some people use their card to make large purchases on items they don’t need without saving up the money first. This is called “spending more than you earn,” which will eventually lead to them not being able to pay off their balance. It’s also possible to run into trouble with card spending if you’re a “saver,” meaning that you typically spend on what you need and no more, but then something like an emergency comes up where your savings are depleted and there are no other funds available.

How To Repair Bad Credit?

Repairing your credit may seem impossible. However, there are tips and tools to help you get credit or fix bad credit. One of the tools you can use is credit cards for bad credit. These are fixed in a way that, once used responsibility, can help to increase your credit score. Of course, you’ll have to fix prior bad habits before applying for one of these as they aren’t a fix-all. You still need to work on other things to repair your bad credit. Follow the steps below to help you improve your current credit score. 

Step #1: Understand How You Got Bad Credit 

The first step to repairing bad credit is understanding why it got there in the first place. It’s common for people living paycheck-to-paycheck or at risk of bankruptcy because they can’t pay back their debts, to max out their credit cards in order to tide themselves over. These people are often unaware of the interest rates they’re being charged and don’t understand how much debt can add up over time.

Step #2: Understand How You Can Fix It

The next step is understanding what you can do about it, which falls into two categories: pay off your balances or work on repairing your credit score. Working with a credit repair agency can help you to improve your credit score by making sure that unpaid bills are brought up to date and debts are settled, while the best way to avoid debt in the future is not having any.

Step #3: Make A Plan Of Action

The last step is to make a plan. This should include what you want out of your credit score-perhaps you just need an emergency fund and don’t care about the scores themselves, or maybe you’re in search of a home loan and will do anything it takes to get one as well as how much time and money you can afford to invest into it.

Once you have your plan in place, you’ll need to begin executing it. 

If you want to fix your bad credit, there are a few steps that should be taken. First, understand how you got it in the first place and why it’s so difficult to repair. If you have unpaid bills or debts from maxing out your card for emergencies or if you just want an emergency fund without worrying about your score-credit cards with bad credit may help. You’ll still need to work on other habits like not spending more than what you earn, which can lead to bankruptcy, but this is a good start! Following these tips and tools when applying for credit cards as well as making sure that all of those payments come up on time each month will go a long way towards repairing any damage done by past mistakes.

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Are Sallie Mae Student Loans Federal or Private?



When you hear the name Sallie Mae, you probably think of student loans. There’s a good reason for that; Sallie Mae has a long history, during which time it has provided both federal and private student loans.

However, as of 2014, all of Sallie Mae’s student loans are private, and its federal loans have been sold to another servicer. Here’s what to know if you have a Sallie Mae loan or are considering taking one out.

What is Sallie Mae?

Sallie Mae is a company that currently offers private student loans. But it has taken a few forms over the years.

In 1972, Congress first created the Student Loan Marketing Association (SLMA) as a private, for-profit corporation. Congress gave SLMA, commonly called “Sallie Mae,” the status of a government-sponsored enterprise (GSE) to support the company in its mission to provide stability and liquidity to the student loan market as a warehouse for student loans.

However, in 2004, the structure and purpose of the company began to change. SLMA dissolved in late December of that year, and the SLM Corporation, or “Sallie Mae,” was formed in its place as a fully private-sector company without GSE status.

In 2014, the company underwent another big adjustment when Sallie Mae split to form Navient and Sallie Mae. Navient is a federal student loan servicer that manages existing student loan accounts. Meanwhile, Sallie Mae continues to offer private student loans and other financial products to consumers. If you took out a student loan with Sallie Mae prior to 2014, there’s a chance that it was a federal student loan under the now-defunct Federal Family Education Loan Program (FFELP).

At present, Sallie Mae owns 1.4 percent of student loans in the United States. In addition to private student loans, the bank also offers credit cards, personal loans and savings accounts to its customers, many of whom are college students.

What is the difference between private and federal student loans?

When you’re seeking financing to pay for college, you’ll have a big choice to make: federal versus private student loans. Both types of loans offer some benefits and drawbacks.

Federal student loans are educational loans that come from the U.S. government. Under the William D. Ford Federal Direct Loan Program, there are four types of federal student loans available to qualified borrowers.

With federal student loans, you typically do not need a co-signer or even a credit check. The loans also come with numerous benefits, such as the ability to adjust your repayment plan based on your income. You may also be able to pause payments with a forbearance or deferment and perhaps even qualify for some level of student loan forgiveness.

On the negative side, most federal student loans feature borrowing limits, so you might need to find supplemental funding or scholarships if your educational costs exceed federal loan maximums.

Private student loans are educational loans you can access from private lenders, such as banks, credit unions and online lenders. On the plus side, private student loans often feature higher loan amounts than you can access through federal funding. And if you or your co-signer has excellent credit, you may be able to secure a competitive interest rate as well.

As for drawbacks, private student loans don’t offer the valuable benefits that federal student borrowers can enjoy. You may also face higher interest rates or have a harder time qualifying for financing if you have bad credit.

Are Sallie Mae loans better than federal student loans?

In general, federal loans are the best first choice for student borrowers. Federal student loans offer numerous benefits that private loans do not. You’ll generally want to complete the Free Application for Federal Student Aid (FAFSA) and review federal funding options before applying for any type of private student loan — Sallie Mae loans included.

However, private student loans, like those offered by Sallie Mae, do have their place. In some cases, federal student aid, grants, scholarships, work-study programs and savings might not be enough to cover educational expenses. In these situations, private student loans may provide you with another way to pay for college.

If you do need to take out private student loans, Sallie Mae is a lender worth considering. It offers loans for a variety of needs, including undergrad, MBA school, medical school, dental school and law school. Its loans also feature 100 percent coverage, so you can find funding for all of your certified school expenses.

With that said, it’s always best to compare a few lenders before committing. All lenders evaluate income and credit score differently, so it’s possible that another lender could give you lower interest rates or more favorable terms.

The bottom line

Sallie Mae may be a good choice if you’re in the market for private student loans and other financial products. Just be sure to do your research upfront, as you should before you take out any form of financing. Comparing multiple offers always gives you the best chance of saving money.

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Tips to do some fall cleaning on your finances



Wealth manager, Harry Abrahamsen, has five simple ways to stay on top of the big financial picture.

PORTLAND, Maine — Keeping track of our financial stability is something we can all do, whether we have IRAs or 401ks or just a checking account. Harry J. Abrahamsen is the Founder of Abrahamsen Financial Group. He works with clients to create and grow their own wealth. Abrahamsen shares five financial tips, starting with knowing what you have. 

1. Analyze Your Finances Quarterly or Biannually

You want to make sure that your long-term strategy is congruent with your short-term strategy. If the short-term is not working out, you may need to adjust what you are doing to make sure your outcome produces the desired results you are looking to accomplish. It is just like setting sail on a voyage across the Atlantic Ocean. You know where you want to go and plot your course, but there are many factors that need to be considered to actually get you across and across safely. Your finances behave the exact same way. Check your current situation and make sure you are taking into consideration all of the various wealth-eroding factors that can take you completely off course.

With interest rates very low, now might be a good time to consider refinancing student loans or mortgages, or consolidating credit card debt. However, do so only if you need to or if you can create a positive cash flow. To ensure that you are saving the most by doing so, you must look at current payments, excluding taxes and insurance costs. This way you can do an apples-to-apples comparison.

The most important things to look for when reviewing your credit report is accuracy. Make sure the reporting agencies are reporting things actuary. If it doesn’t appear to be reporting correct and accurate information, you should consult with a reputable credit repair company to help you fix the incorrect information.

4. Savings and Retirement Accounts

The most important thing to consider when reviewing your savings and retirement accounts is to make sure the strategies match your short-term and long-term investment objectives. All too often people end up making decisions one at a time, at different times in their lives, with different people, under different circumstances. Having a sound strategy in place will allow you to view your finances with a macro-economic lens vs a micro-economic view. Stay the course and adjust accordingly from a risk and tax standpoint.

RELATED: Financial lessons learned through the pandemic

A great tip for lowering utility bills or car insurance premiums: Simply ask! There may be things you are not aware of that could save you hundreds of dollars every month. You just need to call all of the companies that you do business with to find out about cost-cutting strategies. 

RELATED: Overcome your fear of finances

To learn more about Abrahamsen Financial, click here

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How to Get a Loan Even with Bad Credit



Sana pwedeng mabura ang bad credit history as quickly and easily as paying off your utility bills, ‘no? Unfortunately, it takes time. And bago mo pa maayos ang bad credit mo, more often than not, kailangan mo na namang mag-avail ng panibagong loan. 

Good thing you can still get a loan even with bad credit, kahit na medyo limited ang options. How do you get a loan if you have bad credit? Alamin sa short guide na ito. 

For more finance tips, visit Moneymax.



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