In the VSECU Blog you'll find financial and lifestyle resources to help empower possibilities for your personal success.
Your credit score is a number, based on your credit report, that helps financial institutions determine if you will repay a loan. Credit scores can range from 300-850. Typically, the higher the credit score, the more likely the borrower will pay off their loan.
Reducing debt and saving money go hand in hand because you can’t save money if you use every paycheck to pay off debt and monthly bills. How do you get a grip on your debt so that more of your earnings can land in your savings account?
Your credit score is a good tool for measuring your financial wellbeing. Your score shows how good you are at paying bills on time, how much revolving debt you’ve taken on, and any debt you have neglected to pay off. Your credit report delivers your credit score. This is kind of like a report card, showing your overall credit score and the reasons for the low or high score.
As you pay down the mortgage on your home, the equity you build becomes an asset you can use to secure a loan or a line of credit. You can use the loan or line of credit to make home improvements (including energy efficiency upgrades), consolidate debt, make a large purchase, pay off school loans, cover retirement expenses, or more. Because home equity loans and credit lines are secured by your house, you can get a much lower interest rate than you would if you took out an unsecured loan or used your credit card for the expense.
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How lenders view an unsecured debt ratio Think your good credit score is enough to help you get a loan? It may not be as adequate as you think if your unsecured debt ratio is high. Though most people have some level of unsecured debt, a high ratio of this type of debt is a red flag to lenders that you are not in a position to borrow more. Not sure what this means? Keep reading…
Mr. Buble and many other artists sing “I’m dreaming of a debt free/less stressful Christmas!” Okay, I know it’s supposed to be “White Christmas.” And for us Vermonters, a white Christmas is bound to happen! But for most, the holidays bring more than wrapping paper, bows, and gift cards; it brings worry of being able to afford it all, which makes this a perfect time to start thinking about a Christmas savings plan.
When you take out a loan or put charges on your credit card, you’re not just responsible for paying back the amount you have borrowed; you also have to pay interest. However, you can reduce the amount of interest you owe by making extra principal payments. How do you do that?
It seems easy and stress free to swipe the new credit card, or try to get approved for a loan to cover the big expenses. However, as easy as it seems, it’s more stressful! Racking up debt results in heftier monthly payments, and from personal experience I know that these can creep up faster than expected, sometimes leaving you with the occasional… “Where did all my money go?”