Prodigious Texas is known as the “Lone Star State,” – and its residents couldn’t be more proud of the fact that the beautiful state was once an independent Republic with a bright red flag and a single white star remaining to this day. Did you know that three of the ten largest cities in North America are located in Texas? And San Antonio, taking the glorious seventh place, is one of them. But with a big city comes big credit responsibility for its residents and a large field of repairs to cover. Pyramid Credit Repair comes to the rescue, expanding its distinguished and patented services to the beautiful San Antonio community. If your bad credit keeps you from realizing your dreams and living a comfortable life, you can now sleep better knowing that your financial affairs are in the right hands.
Paying Off Your Dues – Tips and Expert Advice
While most consumers know the nuts and bolts of making timely minimum payments on their credit cards, and even if they do not follow the rules, they are surely aware of the consequences. However, as with any other matters within the financial industry – the black magic no one tells you about – there are certain aspects that work for or against your credit score. These unwritten rules may forever change the way you think about your finances and how you manage your spending – the first steps toward better credit.
Credit Statement Basics – Things You Need To Know
That dreadful credit card statement you get every month doesn’t have to be so scary once you learn the basics and understand precisely what each portion means. Part of the fear comes from not knowing, and we want to help you get ahead of the game by explaining a few fundamental laws when it comes to your credit card statement.
So, before we dive into advising on how to pay your financial obligations, let’s dissect the ABC’s of your credit:
- Statement balance – the amount you owe at the end of the last billing period that should not be confused with the current balance.
- Current balance – your credit card’s all unpaid charges reflected on the account. Your current balance may differ from the statement balance, which is often true when you use your credit line daily.
- Minimum payment due – the least amount you are required to pay by the end of each billing cycle, usually indicated by the payment due date. The minimum payment is most likely a fixed amount that you pay each month.
- Payment due date – the date by which you need to make at least the minimum payment on the statement. Most credit card issuers will charge a late fee for late payments.
- Minimum payment warning box – the Credit CARD Act of 2009 legally obligates all credit card providers to insert a “minimum payment warning” as an explanation of what happens when you pay only the minimum each billing period. The statement estimates the total time it will take for you to pay off the entire balance, as well as calculated interest rates that will be applied when making minimum payments only.
- Account summary – all the details and calculations of your current balance.
- Other – your credit card statement may show the recent payments taken into account when calculating the current balance, the applied interest charges, any perks and rewards you get from using the credit line, and other information that may help you understand how you should approach paying off that balance.
Credit Card Bill – what payment and when to make it?
Before we discuss the ideal amount that should be paid each month, let’s talk about a good strategy for timely payments. While you know your due date, which gives you a deadline as far as payment is concerned, it’s good to have a few tricks up your sleeve if you want to boost your credit score quickly. Payment history is one of the most critical aspects in calculating your creditworthiness, and your every move is being reported to the credit bureaus by the issuers.
It is always best to pay your balance earlier during the billing cycle rather than later. Waiting until the last minute to make the payment puts you at unnecessary risk of having that payment posted past its due date as financial institutions operate in various ways. This is especially true when still utilizing the old-school way of mailing checks rather than paying bills online, which are usually posted to your account much sooner.
Having an entire billing cycle to make that payment is a reasonable amount of time to make the right decisions. If you’re having a good month, consider paying off the entire statement by the due date. Paying off your balances quickly, instead of resorting to minimum payments, help your credit score, immediately lowers your credit utilization ratio, and provides lenders with valuable information regarding your ability to borrow money responsibly. In addition, you avoid the massive accumulation of interest rate charges.
Making minimum monthly payments is certainly an appropriate way to keep your account clean of any mishaps, especially if you are on a tight budget. However, even if you can only afford to make small payments to your account, there is a way to “cheat” the system by implementing the micropayment approach. Instead of making one single payment each month, consider making smaller but more frequent payments, which will ultimately exceed the minimum amount that needs to be paid by the end of the billing cycle, lower your credit utilization faster, and avoid high interest rates.
Why Is Paying Minimum Payments Not The Best Approach?
While making timely minimum payments keeps you on track, it slows down the rate at which you are paying off your entire balance. Interest rate charges applied to your balance become part of the minimum payment, and you may begin to notice that your dues remain absurdly high despite your efforts. Incurred interest charges are assessed based on your average daily balance, and if it persists high, so will your interest charges.
Pyramid Credit Repair is becoming part of San Antonio’s vibrant community to help its residents with their credit affairs. Being in the credit repair industry for so long allows our team of experts to customize each course of action based on your individual needs.