Tidbits® – February 2009Credit insight from Credit.comWelcome to the Credit.com newsletter!In this issue, we're talking about the new credit rules that have touched almost every aspect of the financial industry. From credit cards to lending criteria to savings rates the rules have changed. Credit.com gives you an update on the new credit rules to help guide you through the changes. We'd love to hear from you! Send us an email with your questions or comments anytime! Quick TipYes, you can still get a loan! While many lenders have tightened up on their loan approval criteria, it doesn't mean that you can't get a loan – even if your credit isn't so stellar. Apply for a personal loan online today: The New Credit RulesThe US economic crisis has thrown all the old money truths out the window. The credit world has changed in ways that we never expected. From credit cards to lending criteria to savings rates, very few parts of the financial industry have been left untouched. For the February newsletter, Credit.com is giving you an update on the new rules: 1. Don't Count on Your Credit CardsCredit card companies have started widespread campaigns to increase interest rates, lower credit limits, and sometimes even close the accounts of their established customers. These once stable financial products are now standing on rocky ground. And to make matters worse, account closures and credit limit reductions can both hurt your credit scores. What to Do: Have multiple credit card accounts in case one is closed by the credit card company. Be prepared for a situation where your minimum payment might increase. If you've barely got your credit card debt under control, now might be the time to get some professional debt help. It's the perfect time to take control of your debt. 2. The New SubprimeA credit score over 550 used to be enough to get you some kind of loan or credit card. And a rate above 650 translated into easy approval. Now, you need a credit score over 650 to even be considered for many credit products and a score over 750 to be on easy street. The era of easy credit is over. What to Do: Focus on having the best credit scores possible. Start by checking all three of your credit reports and scores online. Once you know where you stand, use Credit.com's free Credit Score Compass tool to estimate how making changes might help boost your score. Reducing your credit card debt, paying bills on time, and avoiding unnecessary credit applications are always good for your credit. Order your reports online: http://www.credit.com/r/identity-guard/ 3. Stop Spending, Start SavingBuilding savings is more important than ever in this rocky economy. You need larger cash downpayments to get good rates on mortgages and auto loans. And in the event of a financial emergency such as a job loss or illness, you can't rely on credit cards and home equity to be your financial safety net anymore What to Do: In a perfect world, we'd all have enough money in an emergency savings account to cover 6 months of expenses and a 20% downpayment to buy a house. In this less-than-perfect economy, start small. Even putting away just $50 a month can be a great way to build your savings. Open a free high-yield checking account online to make sure you're getting the most back for your money. Open a free high-yeild savings account online: http://www.credit.com/r/ing-orange-checking How have you noticed the financial world changing during this recession? Send your stories to our team of credit experts at tidbits@credit.com. Ask JohnWith the credit crunch in full swing, many lenders have been systematically closing inactive accounts over the past several months. But how does this action impact your credit scores? John explains how these accounts are reported in your credit reports and ultimately, how these account closings can impact your credit scores. Get the real story from John Ulzheimer On the BlogOne collection agency takes harassment to a whole new level by threatening to have alleged debtors children taken away and placed in foster care if they didn't pay up. Read more about the lawsuit on the blog: Quote of the Month"I cannot say whether things will get better if we change; what I can say is they must change if they are to get better." - Georg C. Lichtenberg Tidbits® – February 2009
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