Credit Card Insights

The cards we are going to discus here are the Mastercard and Visa only. Banks and Savings & Loans issue these. You can either purchase goods and services using this card or go to the institution who issued you the card and get cash advances, ie., get cash directly against the card.

To obtain these cards, one has to have very good credit or reasonably good credit. Checking your credit can be done in different way. One way is by writing to the Credit Bureau near them and getting your credit standing in the Bureau's Credit File. Another way is to evaluate you by their own standards of point system (please see table at the end of this chapter).

To get a quick guide of institutions issuing credit cards, get out your yellow-pages and look under Banks and Savings & Loans. Call them and make a list of the ones issuing these cards and then go to them and pickup their applications and keep them ready. Then go through this book and write all the ones listed and get their applications. Get a hold of other institutions using the yellow-pages of major cities and get their applications. Then when you have enough applications at hand, fill them all up and mail the ones from zip codes starting 0 to 5 the first day, the ones of zips 6 to 8 the next day, and zips 9 the third day, so they all reach the institutions the very same day (for California only - other states please improvise).

If you get accepted in 10 out of 30, each with a credit limit of $1,000, you can have access to $10,000. This is one of the quickest ways of obtaining a loan in the shortest time (and the safest).

A sure-shot way of getting credit card is the secured cards. These are credit cards issued against your depositing cash in that institution. If you have saving or other checking accounts, then you might as well have it at their institutions which give credit cards in return. The credit requirements of these mentioned ones is not very stringent. A good way to raise your credit limit on the secured credit cards is to take cash advances and re-deposit the cash (and pay the debt) till you reach your credit limit.

Visa and/or Mastercard

There are special bankcard agencies that will issue a Visa and/or Mastercard to anyone that opens a $300 savings account at their bank regardless if the person has bad credit or no credit. It makes no difference if you have a bankruptcy. You're guaranteed the cards regardless hoe bad you credit might he if you open the savings account at the bank! You would receive your card within 30 days from the time you open your savings account with them. The credit limit on the card matches dollar for dollar with the amount of money in your savings account.

A lot of people can't part with $300 for long because of bills that are pressing them. There's a way around this. Go ahead and open the savings account and get the card. Then go to a Western Union and make a $300 cash withdrawal on your card and you have your money right back plus the card. Even though you can't charge anymore because you've reached your credit limit, you can still use the card for identification or check writing purposes. Then you can pay your bill down a little at a time as opposed to putting up the entire $300 at one time and leaving it in the savings account.

Another way to get around not paying out the entire $300 at one time is for you to work with a close family member or friend in splitting the $300 cost to get the card. Decide on which one of you is going to apply for the card first. And when that person gets his card he's to make a $300 cash withdrawal on it so the other person can apply for his card. When the second person gets his card he's to make a $300 cash withdrawal on it also and give his partner his $150 investment back. This procedure will work for as many as 3 people putting up $100 each to help each other get their cards.

There's also a maneuver that a person can utilize with his secured card that will show him more credit worthy than he actually is. It will cause banks to loan him more money and quicker. And it will make creditors want to give you things that they normally would not have. In order to do this you have to be patient and you can't make any charges on you card until you've gotten where you want to be. If you can afford it secure you a Visa and Mastercard. Use one for your personal charges and use the other for the following purpose.

First of all, the bank that issued your secured card will report to the credit bureau the transaction. And on your credit report will be the banks name along with your credit limit and credit ratio. At first your credit limit will be only $300 if that's all you put in the savings account that's required for the card. When you get your card make a $300 cash withdrawal on it and put it in the savings account you used to get the card with your original $300. Then you'll have $600 in the saving account- and the bank will report this to the credit bureau which will automatically boost your credit limit on your card and credit report to $600. This move will allow you to make another $300 withdrawal on your card because you've only made one $300 withdrawal but you have $600 in your savings account. So go and make another $300 withdrawal on your card and deposit it into your savings account and this will automatically boost the credit limit on your card and credit report to $900. Repeat this procedure and your limit will he $1,200. continue until you feel that your monthly payments have reached the limit of what you want to pay. Some people have reached a credit limit on their credit report of $5,000!

The object of this maneuver isn't to reach a high credit limit on your card but rather it's to show the highest possible credit limit on your credit report. Even though your card may have a $5,000 credit limit the fact remains that it's all charged up. But when creditors or banks see a $2,000 or $5,000 spending limit on your credit report they'll think that you are a preferred customer at the bank that issued you the card. They know that banks don't give out $2,000 - $5,000 spending limits on a major credit card to anyone so therefore they'll think that you are somebody special and will be glad to give you the loan or whatever you're applying for on credit within reason especially if they can look back over time on your credit report and see that you made your payments on time every month. But what they won't know is that you were not a preferred customer at the bank but rather you took advantage of a special Visa and Mastercard program that required for you to secure the card by opening a savings account at the bank with a minimum of $300. And that you legally maneuvered your way to a $2,000 - $5,000 or more spending limit that made you look like you were a preferred customer at the bank. But as the old saying goes, "What a person doesn't know won't hurt him." In rebuilding credit it takes time to walk up the credit ladder. Utilizing this maneuver you'll get things on credit in a few months that would have taken a few years to get if you had not done it because it made you look more credit worthy than you actually were according to the standards of most creditors.

The National Credit Bureau is the largest bankcard agency in America that offers a secured Visa and/or Mastercard. Their telephone number is 1-800-433-2455. If you call them requesting their application package they'll send it to you for $39.95 which is a non-refundable fee that covers the expense of setting up your savings account at Transcontinental bank and issuing you the cards. After they receive your application they'll contact you back in 2 - 3 weeks letting you know that your account has been opened all the paper work is complete and all that is needed is your $300 deposit for your savings account. After you send in your $300 deposit you'll receive your Visa or Mastercard in 2 - 4 weeks. And it's just that simple.

Most people charge their credit card and pay installment payments each month on a fraction of their debt. Now that is exactly what the issuing banks want you to do because you are helping them to stay in business. In fact, that is how the banks make their money. However it is your loss in the interest you pay. The new tax laws do not permit you to take any deductible on the interest payments of your revolving debt. The right way to charge is to pay the entire balance WITHOUT paying any interest. That you establish credit as well not pay any interest. Which essentially means that you borrowed the money FREE for that period of time. At the same time, the each in hand can be deposited in interest bearing deposit to EARN interest money for you. So if you do not pay in each for your purchases (assuming that you already -have the each in your hands) but charge it every time at the same time keeping the each in hand in an interesting bearing account actually makes you money; which you would have lost if you would have paid by each.

How long do you think you could charge and not pay back WITHOUT paying any interest on it ? About one month, right ? WRONG !! It is actually two months. Let us show you how:

_Take this case: You have a billing date of the 30th. That means the bank bills you once a month or charges accrued during the month, & the bill comes to you dated the 30th. This bill includes all the charges entered on your account up to the end of business on the 30th. You do not have to pay any of these charges for 25 days after the billing date. After 25 days, interest begins to mount up at 12 to 18 percent in most. So you start with 25 days of FREE credit.

_Example: If you make a local charge -before 3 pm on the 29th, a Monday when Tuesday is not a holiday, and your bank is the same as your retailer's, your real Charge Date is one day later. That is the 30th, but your billing date is the 30th so the charge will appear on the bill of the 30th, and you will have to pay it 25 days later.

_But suppose you made the purchase after 3 pm on the 29th. Then your real Charge Date is now two days later, or the 31st. That is because the charge receipts are deposited a day later by your merchant in his bank.

_You will have skipped over the billing date. The charges will not appear until the next billing date...which is 30 days hence. And you will not have to pay for another 25 days.

You get 55 days plus the two days between charge date and real Charge Date, for a total free credit of 57 days. By simply shifting your chare form before 3 p.m. to after 3 p.m., you gain 32 additional days of free credit.

Obtaining Additional Credit

Now that you have the knowledge of how to start building a strong credit profile in your new credit file, you might want additional credit. DON'T BE IN A HURRY TO DO THIS! If you follow my procedure you'll have 3 banks behind you. Concentrate on improving your ability to borrow money from them and getting other banks behind you if you can. After you pay off your first secured loan, ask the bank loan officer what it takes for you to get a small loan without having to secure it with a savings account. That's what you concentrate on and follow their advice so you can start getting loans on your word! Then you're on your way!

When the doors to the credit world open for most people they start charging things they really can do without, mainly material possessions. I recommend that you concentrate on you being able to borrow the money for the material things you want in life. Then concentrate on your ability to travel by getting a couple of airline cards along with car rental, car repair cards, and a couple of gas cards. Other than this you might want to get a finance company behind you.


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