Opening a New Credit Card Can Affect Your Credit Score
Don’t Trade a Good Score for New Credit
There are lots of good reasons for opening a line of credit by applying for a new credit card, but consumers should be cautious and make sure that their reasons and timing are right. In 2009 the federal government passed the Credit Card Accountability Responsibility and Disclosure Act of 2009 (CARD ACT) which was intended to establish fair and transparent practices relating to the extension of credit including credit cards. The result was that credit card issuers significantly reduced their efforts to issue new cards until they could understand the consequences and revamp their fees, many of which were reduced by the act. Now that they have redesigned their card programs, the floodgates have opened again and many Americans are inundated every day with new card offers.
Being offered a new credit card is flattering, but it is not a good reason to open a new card. Opening a new card has the effect of lowering your credit score as a result of the inquiry. Also adding to your available credit could have a similar effect if the credit scoring formula penalizes you for having more available credit than your income warrants.
Monitor your credit reports carefully to watch for unusual activity and inquiries that can damage your credit score. If you find inaccurate, outdated or fraudulent activity contact the credit reporting bureau immediately and contest or challenge the information. The process for doing this is provided to you with the report. Many people are intimidated by this process or unsure of exactly what qualifies as a contestable entry on the report. For a modest fee you can obtain assistance from a credit repair organization such as get credit repair company. They will review your report and explain to you what you can and cannot do and assist you with challenging the derogatory entries. Reputable credit repair companies have highly qualified credit repair counselors that have far more experience removing negative information than you.
To assist you in selecting a trustworthy firm, check with the Better Business Bureau to learn about the performance of a particular company. The Credit Repair Organization Act (CROA) provides you with certain rights and protection. A credit repair organization must provide you with a written contract that sets forth in detail your rights and obligations. This contract must include the terms of payment for services, a detailed description of the services to be performed, approximately how long it will take to achieve the results and any guarantees that they offer.
Additionally, a credit repair company cannot make false claims about their services or charge you until they have completed the promised services.
Get Credit Repair Company has helped thousands of consumers across the nation repair their credit reports. For more information about their programs, contact 1-800-665-9981. They can also be found on the web at http://getcreditrepair.org
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