Payday loan providers focus on debit card history, will others?
The best payday loan providers understand how managing bank accounts is an important piece of the money management puzzle. Too often other lenders and creditors ignore you while focusing on your credit check details. So much emphasis is placed on the use and management of credit cards that those who choose not to use them end up being ignored. There is no recognition for debit card management skills, at least not yet.
People have been managing household finances for many years with little or no credit card use. Some people prefer to pay cash and want nothing to do with plastic debt traps. Other people lost the ability to use credit by misusing it or mismanaging the debt portion. Now that most bank debit cards can also be used as credit cards, people with credit problems have access to much of what the world’s credit users have had at their fingertips. There is no fear of debt problems or accumulated interest. Debit cards draw payment directly from your bank account. If you don’t have money to cover the payment, you will receive overdraft fees and unfunded business fees.
For those who use debit cards due to credit problems, this bank information helps represent your most current money management activity. The credit reporting agencies do not use this information to help rebuild a low score. Popular financier Suze Orman wants to change this. She is on a crusade to include debit card use in the equation to help build financial security. He has an uphill battle ahead. So far, his petition to make a change has more than 175,000 supporters.
There are doubts that Suze Orman will ever move forward. Credit scores were created to help lenders make better decisions. Credit cards reflect how a person manages the money of others. The use of debit reflects how people manage their personal money. Consumer Education President John Ulzheimer has a different take on debit card use than Suze Orman. He believes that the only similarity of debit and credit cards is their appearance. In many ways you are right, debit cards are not passive. A user has no outstanding obligations other than his personal money matters. It will be interesting to see how the two sides develop during this exploration.
Meanwhile, those who continue to have credit problems will continue to have easy access to quick cash loans. Applicants will need to have a working bank account and no credit checks will be processed for loan approval. People will continue to seek budget relief as they work to rebuild credit scores.
It is good to have options. Since bad debt management will stay on your credit history for 7 years or more, it feels good to know that there is help beyond creditors. Use loans wisely, as any delinquent loan will only further damage your credit history. With a quick payment demand, it is important to consider all other debt obligations before applying. How much can your next paycheck cover once the payment is made? Many borrowers will go back to getting a new loan to make their budget work. Repeat loans equate to massive financing expenses. Before taking out any type of loan or using credit, think ahead. Ask yourself how your budget will handle the effects of paying off the loan plus fees in full without having to borrow again.
Keep your bank accounts running smoothly and look to improve your credit history. You never know when you might need a good score. Develop a plan to maintain your obligations to outside lenders. Keep your bank account healthy and rebuild your credit to build a secure financial future.