Bankruptcy

Credit Card Borrowing Is Down ? Are You Getting the Benefits?

By meaghano

Americans cut back on our credit card borrowing in February by $7.5 billion dollars, which was apparently more than the money mavens on Wall Street expected, according to a recent Wall Street Journal article.

February?s decline marked the fourth in the last sixth months, which could mean either we?re collectively tightening our belts (yea!) or we?re just having trouble getting people to lend us money (boo!).

Benefit from Lowered Borrowing

If you?re one of Americans contributing to the decrease in credit card use, your credit rating may improve because of it.

But, according to a study done by the U.S. Public Interest Research Group (PIRG) in 2004, as many as 25% of Americans have serious mistakes on their credit reports.

• How can credit report errors hurt me? Incorrect information on your credit report could affect your ability to borrow.
• What type of borrowing can be hurt? Serious errors cause your credit score to fluctuate from 20 ? 100 points, which could mean higher interest rates on loans. Over the life of a loan, this could translate to your thousands of extra dollars to borrow money.
• How do I know if my report has mistakes? There?s only one way to find out, but luckily it?s free and easy: visit www.annualcreditreport.com and take a look at your credit report. You can view one free report each year from each of the Big Three bureaus.
• How do I fix the mistakes? You need to contact the reporting bureau in writing about the mistakes you find. For more information about submitting consumer complaints, check out the FTC?s Web site.

Take Control of Your Finances

I?ve said it before, and I?ll say it again: you?re the only one who can improve your financial situation.

It?s encouraging to see that we might be borrowing less on credit cards as a nation, but make sure you?re reaping the benefits of any financial steps you take. But if you’ ve tried everything and are still struggling, it may be time to consider filing bankruptcy.

Full post as published by The Bankruptcy Blog on May 26, 2009 (boomark / email).