Essay About Credit Card And Credit Card Balance

Credit Card Rating
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Credit Card Rating Your credit card balance is not only the balance you owe to the credit card issuer. Your credit card balance has a direct impact on your credit card rating. As this credit card balance is reported to credit card bureaus, your score can fluctuate.It is the process of the rating of the borrower by the debtor and it is the risk, that is taken by the debtor as they give you a loan and they don’t even know if the borrower can pay the money back. That is why the debtor looks at the borrowers credit history and judges if he can lend the money. A Brief Explanation of how Credit Rating is calculated Your credit history is a numeric grade that indicates where your credit history stands at a specific point in time. The credit card rate is based on information about your credit card, loans and other debt accounts listed in your credit report. Things like the account balance, payment history,credit limit, and the age of your account are listed on your credit report and are used to calculate the credit rate. Each factor is given a different weighting during the calculations they are as follow;   Payment history counts for 35% of the totalLevel of debt counts for 30% of the total Length of credit history is 15% of the total Inquires and mix count for 10% of the totalThere are multiple implication of having a poor credit card rating such as;  The rates would increase on the credit card interest and the loans.Creditors and lenders see the applicants with bad credit card rating as they will have a high risk compared to an applicant with a good credit rating. They make you pay for the risk by charging a higher interest rate. Over time you will end up paying more interest if you have a better credit card and a better rate. Credit cards loan applications would not be approved.As your credit card lenders and creditors think that you have a bad credit is a risk, they might not want to lend you money at all. With, bad credit you may see that your applications will be denied. Difficulty get approved for an apartment.  Did you know that landlords check credit history, before lending or selling? If you have a bad credit rating it may leave you homeless or even close to it. Security deposits on utilities. Utility companies- electricity, phone and cable- check your credit history as a part of the process of the application. If you have bad credit history you have to pay security deposits to establish a service in your name, even if you pay your utility bills on time.. These security deposits are charged upfront before you can establish the service in your name.            You can’t get a phone contract. Yes, cell phone companies check your credit history as well. They contend to a month of service towards to you, so they have to know if you are reliable and pay the money back. If you have a bad history, then you have to get a prepaid cell phone plan or a month-month plan where phone are typically more expensive, or go  without one at all. If you are leasing or making payments then the payment would be higher, if you have a bad credit rating.  You may be denied employment.Certain jobs in higher management of the finance history, require you to have a good credit history. You can be turned down due to negative items on your credit report, especially high debt amounts, bankruptcy, or outstanding bills. Note that the employer is checking credit report and not your credit score, They are looking at factors that can affect someones working life.Higher insurance premiums.Insurance companies check credit rating as well. They argue that if someone has a lower credit rating that is due to that higher claims have been filed. Because of this theory they check the credit rating, and give people with a low credit rating a high premium.Calls from debt collectors. Bad credit rating doesn’t itself doesn’t lead to debt collectors calling. Chances are that if you have bad credit rating there are chances that the debtors are trying to pursue some past bills that have been due.  Difficulty starting your own business. Many new business need loans from a bank to startup and to fund themselves. If you have a bad credit history this  would limit the amount you can get the from the bank as a loan, even if you have the greatest idea and the data to prove it. Difficulty purchasing a car.Banks check the credit history before giving you a car loan. If you have a bad credit  history you may be denied or be charged at high interest rates. Most of those “no credit check” car lots charge extremely high interest rates and make it difficult for you to make the monthly payments.  The credit card rating represents an evaluation of the credit card rating agency of the qualitative and quantitative information for the prospector debtor, the information is provided by non-public organizations and government bankers.Things like account balance, payment history, credit limit, and age of the account are listed on your credit report and these aspects are used to calculate your credit score.