Credit Card Crunch Concerns
It's no wonder Credit Card Al is seeing all kinds of credit card default reports mounting in the news, and there is little doubt at all: The credit crunch is definitely going to affect credit cards and credit card debt. Will we spiral??? In and article on CNNMoney.com on August 24, 2007, titled "Credit crunch hits cards too", Gerri Willis reports that "Rates on credit cards are rising as banks tighten lending standards." The article reports that interest rates for credit card holders are creeping upward, while credit limits are being significantly reduced. Furthermore, the article reports that for someone with a credit score of 680, approvals are down from a normal 50-60% rate to 35%! One thing you can do to help with your approval rating, is to apply for a card that fits your credit rating. To find out what yours is, we recommend one of our sponsors who we think provides the best introductory deal, FreeCreditReport.com.
Other financial pundits and reports are echoing this same credit card crunch concern. An article in the Chicago Tribune by staff writer Susan Chandler, titled "The Next Credit Crunch?" echoed similar concerns on August 26, 2007, noting that the tightening in the mortgage market means that fewer people are able to pay down their credit card debt through their mortgage line, which means that fewer people will pay down their credit card balances. I am worried now that as we approach the Christmas shopping frenzy, with credit card debt on the rise, retailers may expect a down season this 2007. With consumer confidence lessening along with mounting debts, I think the economy may take a further hit as a result.
Credit Card Al. Are you shorting retail stocks yet? Jon Ogg reports on BloggingStocks.com that Jim Cramer is telling us to bottom feed some retail stock bargains now, but I am really not sure he is right...
What does this means for you if you have a high credit score? Well. Like Al said... try for one or more low interest cards and expand your credit now. What if you want to expand your credit but you already have high balances? At a minimum transfer the balances to a 0% APR Balance Transfer credit card, and put the payments you were making toward principal only during your interest free holiday. And, try to expand your credit. If you keep your card balances at 30% or less, then more banks are more likely to issue you more credit. YOU DON'T HAVE TO USE IT ALL! In fact, you should revolve it and expand it by keeping each credit card line at about 30% of credit capacity. (More on this later...)
Other financial pundits and reports are echoing this same credit card crunch concern. An article in the Chicago Tribune by staff writer Susan Chandler, titled "The Next Credit Crunch?" echoed similar concerns on August 26, 2007, noting that the tightening in the mortgage market means that fewer people are able to pay down their credit card debt through their mortgage line, which means that fewer people will pay down their credit card balances. I am worried now that as we approach the Christmas shopping frenzy, with credit card debt on the rise, retailers may expect a down season this 2007. With consumer confidence lessening along with mounting debts, I think the economy may take a further hit as a result.
Credit Card Al. Are you shorting retail stocks yet? Jon Ogg reports on BloggingStocks.com that Jim Cramer is telling us to bottom feed some retail stock bargains now, but I am really not sure he is right...
What does this means for you if you have a high credit score? Well. Like Al said... try for one or more low interest cards and expand your credit now. What if you want to expand your credit but you already have high balances? At a minimum transfer the balances to a 0% APR Balance Transfer credit card, and put the payments you were making toward principal only during your interest free holiday. And, try to expand your credit. If you keep your card balances at 30% or less, then more banks are more likely to issue you more credit. YOU DON'T HAVE TO USE IT ALL! In fact, you should revolve it and expand it by keeping each credit card line at about 30% of credit capacity. (More on this later...)
Labels: balance transfers, blogging stocks, cnn money, cnn news, credit score, jim cramer, low interest cards
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1 Comments:
There is a real concern with the retail sector, but gas prices are real as well. While wages are up this year (good for those of us that work for a living), higher gas and health insurance prices may neutralize that. Americans haven't gotten a real improvement in their quality of life in quite a while, the book years of the 90s are now 7 or 8 years behind us. For a young family starting out, it's a challenging environment... we have ridiculously high mortgage payments because of the boom, and high property taxes are a killer.
Shorting retail stocks, I have almost nothing in the market that I can play with. My credit card companies keep reducing my limits as I pay the debts down, which keeps my cards at 80%-90% capacity because every time I take a balance down by $1000, they lower my limit.
The credit crunch has also made the balance transfers harder to come by. I think that it is time to find more credit, and see if I can ride out the crunch.
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