Credit, broadly defined, is the provision of money on the assumption that compensation for it will come later, or over time. Consumer credit is simply credit extended to individuals in order to purchase consumer goods or services. Many people in Collingswood, New Jersey deal with 1 type of consumer credit almost every day: credit cards. These small pieces of plastic are one of the biggest sources of consumer debt in the United States.
Why can't I Get Credit in Collingswood, New Jersey?
The most likely explanation as to why a Collingswood, New Jersey bank won't give you a credit card or loan is that you have bad credit. Credit scores in Collingswood, New Jersey are calculated by private companies known as "credit bureaus." These entities compile all the available information about your finances, look at how much debt you have, if you've paid it back in a timely manner, and other factors, and calculate a numerical score. This number provides potential lenders with a quick assessment of how risky it is to lend money to a person. The exact formulas that these companies employ to create credit scores are trade secrets.
U.S. law states you are entitled to one credit report per year for free. This will allow you to see your credit score, and any factors that might be hurting it, which can help you improve it in the future. You should be aware, however, that various websites offering a "free" credit report will begin charging you a monthly fee a month after you register, and then make it very hard for you to cancel your membership, requiring you to do so over the phone rather than online. They also sometimes only tell you about this fee in the fine print.a
How Can I Improve My Credit Score in Collingswood, New Jersey?
The first thing you can do to improve your credit score is to check your report for errors. These companies are not infallible, and sometimes make mistakes in compiling your credit report, including very serious ones. If you find an error, you should report it to the credit bureau, and they will normally fix it. It will also help to show that you can use credit responsibly. For example, if you have little to no credit history in Collingswood, and want to quickly build a positive credit rating, you can get a credit card, and make a few very small purchases with it each month. Make sure you don't run up a balance that you can't immediately pay off in full, and at the end of each month, pay the entire balance.
Credit reports are meant to be a tool for lenders to easily assess a person's risk as a borrower. Therefore, showing that you are able to pay back your debts on time can be very effective in creating a good credit score.
How Can a Collingswood, New Jersey Lawyer Help?
An experienced Collingswood, New Jersey attorney specializing in consumer financial issues can help if you believe that your credit score reflects false information, or if you think a third party has maliciously damaged it.