It seems that almost everyone has a credit card these days, right? They are so much easier to use than cash or checks. But what many people don’t realize is that using your credit card loans can even be used to MAKE MONEY!
First, let’s start with the basics, and then get into the more complex. This article is a bit lengthy, so sit back and relax. Also, let me add a disclaimer that you should always follow all applicable laws and credit card loan agreements, and I have no idea if any of this would affect something like your credit rating. But nevertheless, here it goes:
How to Make Money by Using a Credit Card (Loan)
If you use your credit card, you could actually make money. I am sure you are probably familiar with how a credit card works. Companies charge interest and other various fees in exchange for the flexibility to have a loan at any time. But if you know a couple of tricks, using your card can help you to make some money on purchases. Here is how:
Make Money From Credit Cards by Joining Programs to Earn Points, Cash Back, and Rewards
This is a simple one, but many people don’t realize that most reputable credit card companies will offer a rewards, cash back, or points program. So making money in this way is pretty simple. All you have to do is join (or sign up) for the credit card companies rewards program. Many programs will offer $1 for every $1 you spend, or 5% cash back, etc. There are many different programs, but the point is that you can earn money (or points that you can use to redeem money or gift cards).
So in this deal, you simply use your card to buy the stuff you need to buy each month (groceries, gas, entertainment, etc.). Then, you will be earning points, cash, or rewards that you can redeem. BAM- easy money. However, the thing you want to watch out for is getting trapped by high interest rates or fees. Instead, apply for a credit card program with a good grace period before the interest starts to apply. For example, if your card has a 30 day grace period, you can use your card, and then pay the balance in full as soon as you receive your bill. Easy money! Just don’t keep a balance or get hit with late fees if you want to make sure you make money and don’t lose money.
Make Money From Credit Cards by Utilizing the Interest Free Loan Offers
One of the sneakiest ways of making money with credit card loan programs is by taking advantage of the “Zero Percent (0%) Introductory Interest Rate.” You have to be careful with these and read the fine print, but if you are able to get approved for one of these with a high credit limit, it is almost as good as cash in the bank. Here is how this works:
First, you have to apply for a credit card loan with a good company (Discover Card, Bank of America, CitiCards, American Express, etc.) Find an offer by shopping online and comparing offers. You specifically want to find one that offers both 0% interest on both purchases and balance transfers for as long as possible (1 year is great). Once you get approved for the card, you can immediately use it in one of 2 ways (or a combination of one of the two ways):
1. You can use the zero percent offer on purchases to buy merchandise all year. Use it for all of your purchases (groceries, gifts, entertainment, gas, rent, etc.). Then take the money you would have used to buy it, and place it in a savings account, a CD, or invest in stocks (or your own business). This way, you essentially free up your money, and you are using other people’s money at no cost to you. Pay the minimun interest charge each month, and do this until you will begin to get charged interest. At this point, you can either choose to pay interest for a while, or you simply pay off the balance in full.
2. An even more sneaky method, is to use balance transfer switch method. This is where you get a credit card with a 0% interest rate. Once you get the card, you get cash a convenience check, or some companies will allow you to place the money right into your checking account. The only thing you have to watch for is balance transfer fees. Some companies will tack on a 3% or higher fee of the total balance. So you must calculate this into the equation. But you can sometimes get money for free (no balance transfer fees, and no interest for a year).
So what do you do? You can apply for a zero interest (with no balance transfer fees) and request a convenience check or bank account deposit. Then you withdraw the money, and immediately invest in the safest high interest yielding account you can. So let’s say you get $10,000, and you invest that for 1 year into a CD that pays 5%. That would be an easy $500 for almost no work.
But wait, the trick doesn’t stop there. Once it comes time for the interest to be due, some sneaky people pull a “switch.” What am I talking about here? I mean they then apply for a card with a totally different credit company. When they get approved, they then transfer the balance (which should at this point be slightly less that $10,000 since they had to pay a minimum payment for a year) to the new card. BOOM, another year of interest free money. Rinse, wash, repeat.
There is no doubt that some sneaky people may have done this for years, and made thousands of dollars. Combine this with rewards you earn (if you use it for any purchases), and you are actually making money from credit cards.
The only downside is, you have to read the fine print! Know any fees you may pay, make sure the interest rate is in fact 0% and for how long. Also, it may have some kind of effect on your credit. However, I assume as long as you pay your bill on time it would lower any credit scores too bad.
How to Apply For a Credit Card Online
A credit card (if properly managed) can be a very convenient thing to own. Credit cards make buying items quick & easy.
You can make purchases online or in a store, and you can easily pay your statements online, & more. You can also transfer balances, request cash advances, and more.
Also, most credit cards will give you protection against fraudulent purchases and/or scam artists that sell you items online & never deliver them. This can ease your mind when making online purchases.
Another great benefit of owning a credit card is that it will help to boost your credit score (as long as you pay on time).
Tips to Apply & Get Approved for a Credit Card
Credit card applications are simple to complete, and you can usually do this online. Caution, always make sure it is a legitimate credit card company, and that your internet connection is secure before entering your personal information.
Which credit card company should you use? You should stick with one of the top companies. The top credit card companies are Visa, MasterCard, American Express, and Discover. Of course, there will be many banks that offer these cards (such as Citi, Bank of America, Capital One, etc.).
When you decide on a credit card company, go to their website & fill out a simple application. Again, make sure that it is a legitimate & secure site.
The application will ask standard questions such as: Name, date of birth (you must be 18), address, phone number, social security number, annual income, etc.
Most credit card applications can be completed in minutes. Most companies will even let you know within 30 seconds if you are approved or not.
If you are approved, you will get a new credit card in the mail. You then simply call and activate it, and you are ready to charge your purchases!
Just read the terms & fine print carefully. Do not settle for a ridiculously high interest rate. Also, try to get a card that offers points or bonuses that you could use that compliment your lifestyle or buying habits.
That is it! Now, you are ready to be on your way & fill out a credit card application. Also, it is strongly recommended to open a checking account so that you can pay your monthly credit card statement.
Also, if you have bad credit, you can see the section below about how to improve your credit score so that you can get approved for your first credit card.
How to Open a Checking Account At Banks
These days, it is almost impossible to operate without a banking (or checking) account. Bank accounts are great and you can open a personal or business checking account at almost any bank.
You can use a checking account to pay bills, buy items, cash and deposit checks, and much more! You can also take advantage of great online services such as direct deposit, and online bill pay. The best part is that most banks these days offer a free basic checking account. These accounts are usually free of any basic fees or charges.
To open a banking account in the U.S., you will need to be at least 18 years old. If you are under 18, you can usually still open a checking account by getting a co-signer (such as a parent or guardian) to put a signature down on your application.
To open your account, simply go to your nearest bank of choice. You may also open bank accounts online, however, you should make sure it is a legitimate company before entering any personal information.
You will need to enter your social security number, address, name, phone number, etc. You may also be required to provide identification in the form of a driver’s license, birth certificate, social security card, etc. Most banks require 2 forms of identification.
Then, after you fill out the paperwork, you will be issued a checking account number. You may also be given a few deposit slips & temporary checks.
You will need to buy permanent checks. You can buy these online, or from your bank. Tip, try to start your check numbers at around 500-2000. This way it will not be noticeable to merchants that this is a “new” account.
In addition to checks, you may want a checkbook. Remember that some banks will furnish checks, plastic checkbooks, deposit slips, and more for free. So check with your bank before buying these items.
Also, many banks will let you sign up for a free ATM card. These are very convenient, however, you should take the time to see any fees that may be charged when using them.
After this, you are ready to start writing checks & using online banking services. This will also enable you to establish a relationship with that bank. This can allow you to easily apply for a secured credit card if you ever need to boost your credit so that you can get approved.
How to Boost or Raise Your Credit Score History Rating
First, let’s discuss the factors that make a good credit score. What is a Good Credit Rating Score?
Typically if your credit score is above around 620, you are considered to have a “good” credit rating. Your score gets better and better when it gets closer to the 800 mark. It is rare to have a perfect credit score, even if you have paid all of your debts in a timely manner.
Usually if your score is around 720 or higher, you are considered to have “great” or “excellent” credit.
This is very important because the higher your credit score rating is, the better your chances are of getting approved for a loan. Also, if you have a great credit score, you usually qualify for better loan terms & interest rates.
How to Fix or Improve Your Credit Score Rating
Know that you know that basics of how credit scores are calculated, you can begin to improve your credit score. Simply follow these 10 tips & your credit score should begin to improve within a matter of weeks or months:
1. Try to pay off any previous outstanding debts you have that are unpaid or delinquent. This can have a huge impact on your score.
2. Reduce the balance on your credit cards. Generally, it can hurt your credit score if a credit card has more than 50% of the balance used. (e.g. you have a $5,000 balance & you have $2,800 charged).
3. Avoid cancelling credit cards. It is best to pay off the balance but keep the card open. This shows that you have a long standing credit relationship with the lender and improves your score.
4. If you don’t yet have credit established, then you can establish a credit history by getting a co-signer to apply for a basic credit card or small loan amount. Then charge a few things (gas, etc.) and pay off the balance each month in full. If you are careful not to overspend, this is an excellent way to establish credit.
5. Pay your bills on time! This may be one of the absolute easiest things you can do. By simply paying your bills when you are supposed to, is says to other lenders “this person will pay us back.” They will be more likely to approve you for that loan.
6. Don’t buy more than you can afford. If you buy more than you can afford by charging it to a loan or credit card, then you are only acquiring more debt. Be more disciplined with your money & postpone those luxuries until you can afford them. This will reduce your overall debt & help keep your score high.
7. Check you credit report often. You can get access to a free credit report annually, and many services are inexpensive or free that allow you to frequently check your credit report. This way, you can make sure there are not mistakes on your credit report.
8. Establish good relationships with creditors. A common myth is that if you have several credit cards, then it will hurt your credit rating. Actually, as long as you don’t have balances on most of your cards, lenders will see this as you being disciplined & they will have greater confidence in your credit worthiness.
9. Settle past debts. If you have collection agencies calling you, then work something out so that you can make payments to pay off your past debt. This is improve your score dramatically if you take care of past debts.
10. Repeat steps 1-9! These steps will ensure you keep a clean credit history, which will boost your credit rating dramatically. You can then enjoy easy loan approval, lower interest rates, and better loan terms! This is very important to do so that you can maximize your odds for being approved for a credit card (especially if you’ve had bad credit in the past).
Not only will this help you get approved for a credit card, but it can also help you when you apply for a mortgage. Here are a few tips if you’re planning on doing that as well.
How to Get Approved for a Mortgage Home Loan
If you are in the market to buy a house, then you will probably need to apply for a mortgage. A mortgage is just a fancy word for a home loan. In this article, I will try to help you understand the application process for a mortgage & how to apply for one.
How Does A Mortgage/Home Loan Work?
When you want to buy a house, you will usually need to get a mortgage/home loan. This is because the average person cannot afford to spend thousands or hundreds of thousands of dollars up front to buy a house. So instead, you can borrow money from a lender & pay the money back on a monthly basis (with interest).
When you make the decision to apply for a home loan, then you first need to find a lender. There are several banks and mortgage companies that will lend you money if you qualify for a loan. You can browse the “loans” section of the phone book, or request information from your local banks. You can also shop around for mortgage rates & quotes online.
Once you have found a company that has reasonable rates/terms, you can apply for the loan. The typical mortgage loan application will ask you for the following things:
- Loan amount you are requesting
- Your personal information (and anyone else who co-signs for the loan)
- Your income information with check stubs & W2 forms needed for proof
- A list of your current assets (cars, savings, etc.) and liabilities (credit card debt, loans, etc.)
- Your credit report history (the bank will look that up automatically)
This is standard information that the lender will need to review your application & see how much you can borrow & how reliable you are at paying back creditors.
After the bank/lender reviews your information, they will tell you how much you can borrow, the interest rate, and different loan terms you can select.
A general rule of thumb is that 30-year fixed rate mortgages are generally better. There are several other types (variable rate, interest only, etc.). Most of these, however, are more costly in the long run & change when the interest rates change. A fixed rate loan, however, will have the same interest rate & monthly payment for the entire length of the loan.
Also, many lenders will charge an application fee or loan fee. Companies vary on the fees charged & when they charge them (some charge a fee for the application, others charge fees or “points” after you have been approved).
Tips on How to Make Sure You Get Approved for a Home Loan/Mortgage
Before submitting a mortgage application, here are 5 quick tips to help you get approved:
1. Work to make sure your credit score & history are in good standing (see tips above). If they are not in good standing, then take time to fix your credit. This can help you get approved & save thousands on additional fees & charges.
2. Make sure you can show proof of an income. If you have no money coming in (or not enough money coming in), then you will likely be rejected. This is just common sense. Would you lend thousands of dollars to someone without any money coming in?
3. Seek a good co-signer. This can be a spouse, parent, or grandparent, etc. Basically anyone who trusts you and is willing to sign & be responsible if you do not make payments. This will increase your chances of getting a loan.
4. Borrow within your means. Remember, in addition to your monthly mortgage payment, you will have other hidden fees such as house insurance, property taxes, etc. Even if you fall in love with a place, don’t request an amount that is out of your financial control.
5. Place a reasonable down payment. If you can place a down payment of 10-20% of the loan amount, this will almost always improve your chances of getting the loan.
Finally, here’s a tip most people don’t realize. By keeping a good credit score, a good credit card, and a good mortgage standing, you may be able to save money in other areas of your life. For example, let’s take car insurance. Here are a few tips to save money on car insurance:
How to Save Money on Car Insurance and Get Cheap Rates
Buying car insurance can be stressful and expensive, especially if have never done it before. Buying car insurance is like shopping around for your favorite pair of shoes or tools for a bargain price.
While shopping for these items, you will have the option of buying the off brand item which is undoubtedly cheaper, or you will have the option of buying the brand name item for double the price. However, you think in the back of your mind that the less expensive brand will probably tear up within a few months and it might not be as reliable as the brand name item.
So thinking about your budget and the over time you have worked, your like what the heck I will buy the brand name item because it will last longer and will hopefully be more reliable.
This scenario is a lot like how buying car insurance is like for some people. When they are buying automobile insurance they usually will go with the auto insurance company that is advertised the most on TV and seems to be more reliable because of how well they present themselves.
This makes them feel like their money is being well spent and the little bit of extra money they are spending will make a difference. However, sometimes they are right and other times they are wrong because it all depends on how you shop around!
How to Save Money on Car Insurance
When buying car insurance, shop around! When shopping around, go online and get auto quotes for every auto insurance company you can think of. Donç¨š just get two quotes and go with the cheapest one because this is not shopping around.
Now a days shopping around for car insurance is simple because all you do is go to the car insurances company’s web site and enter in your information about your driving record, who will be on the insurance with you, options of how you want to be insured, and the type of car you drive.
Then with in seconds you have your quote of how much it will be monthly or for six months. Another plus of shopping online is cutting out the unbearable sales man!
Once you have selected the company you want to go with, just simply pay online too! Paying online is great because you are able to do it within seconds, many companies give you a discount for just buying online (save $20-50), it’s safe and secure, you can pay with a credit card, and you will be able to print your insurance card right after the purchase. Plus it’s perfect for people who hate talking on the phone and for ones who hate talking to people they can’t understand because the other person’s foreign accent.
The Best & Cheapest Car Insurance Companies
Again, there are several car insurance companies to choose from these days. You have local (small) companies, and then you have these large nationwide companies.
Who is the cheapest? Again, shop around but usually you can find the cheapest deals online. Get a quote from the top companies, and go with the cheapest one that offers the coverage you need. Some insurance companies that you should check out online are Progressive, Allstate, eSurance, Geico, State Farm, and AIG Auto Insurance!
How to Get Free Stuff Online (For Real-No Scam)
As I checked my mailbox yesterday, I got yet another freebie. I don’t know about you, but I absolutly LOVE free stuff!
I will let you in on a simple secret to getting free samples that you may not know about: Walmart.com. All you have to do is go to their free samples section, and you will find many different free samples to choose from, all of them are 100% legit. All you have to do is enter your address and information, and it will arrive in the mail within 2-6 weeks.
At this point in time, I have racked up all sorts of freebies like: A roll of toilet paper, crest white strips, toothpaste, coupons, napkins, dog food, detergent, soap, and all sorts of things. It may not sound like much, but it is always nice getting free stuff. Sometimes, you even find new products you love.
Like one product I got was this stuff called digestive advantage. I have lactose intolerance, so it was awesome to get these products as a sample. It turns out they are really effective, and I use the darn things all the time.
My wife is the one who really checks them out all the time. Just yesterday I got the crest white strips sample–but I haven’t used it yet. Anyway, just in case you didn’t know, that is a pretty easy way to get free stuff.