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How To Get A Visa/MasterCard With No Credit Check
SHAPING YOUR APPLICATION TO FIT THE RIGHT PEOPLE
Creditors approve credit to those people who most closely match
the right profile. They arrive at those conclusions by assigning
point values to various items of information that are included
either on your credit application or in a credit report.
Credit card companies like credit scoring systems because as a
large volume creditor, they can replace trained credit personnel
with a relatively few employees who can quickly total number
columns and determine is an applicant's point values add up to
the right score.
Scoring, of course, is done for one reason. A creditor just
wants to know that the odds are high he will get his money back.
Scoring systems are fine for those people who fit right into the
right profile, but what about those who don't but could pay off
their monthly obligations just as easily and reliably as the
next person? If you are one of those people who just doesn't
"fit the mold," you'll simply have to make a few adjustments in
your application so that you fit the scoring profile of what a
creditor is looking for in a final total.
HOW CREDITORS RATE AN APPLICATION
The first thing you should know is that every system is
different. That in itself can work to your advantage. You could
be rejected by one company's scoring system and approved by
another. One creditor's system will give you many points for a
good answer, and totally ignore a question that gives a negative
answer. Another creditor can simply reverse the process.
Keeping in mind that creditors use different scoring systems, we
will list only the most important questions and briefly review
how a response can affect your total score. The following
categories are listed from the highest to lowest awarded each
response.
RESIDENCE- The longer you have lived in one place the better.
Stability is given high points.
HOME OWNERSHIP- The best possible housing situation is to own
your own house, even if it is mortgaged. The worst is: renting
an unfurnished apartment, living with your parents, living in a
trailer or motel.
GEOGRAPHIC LOCATION- Scoring systems are adjusted for
differences in geographic locations. For examples, home
ownership may not score high in an area where there is a high
incidence of credit problems, reoccurring employee/employer
differences, low income, etc.
EMPLOYMENT-The longer you have been on the job the better.
OCCUPATION-Occupations can be divided into many categories with
a high to low score within each category for different
occupations. Sometimes an employer is scored, instead of the
occupation of the applicant.
AGE-Older is not considered better until you pass age 40. Under
25 to the end of the 30's receive the lowest scores. The
rational is that people under 25 haven't proven they are a good
credit risk. People in their 30's are still raising a family,
buying a home, and tied down with enormous expenses. This is
also the time most people declare bankruptcy.
INCOME- The higher your income the more points you will receive.
TELEPHONE-Having a telephone is an indication of stability. Give
yourself more points.
AGE OF AUTOMOBILE- No auto is a low score, but the newer the
vehicle the higher the score.
DEPENDENTS- One to three indicates responsibility and stability.
After three, points drop rapidly.
CITIZENSHIP STATUS- Non-citizens receive negative points.
BANK ACCOUNTS- You receive high points if you have a checking
and savings account.
CREDIT REFERENCES
IN-HOUSE RECORDS- A good payment record will earn you more
points.
CREDIT CARDS- The more major credit cards you have the better.
BANK LOAN- A current bank loan will increase your score.
FINANCE COMPANY LOANS- You will receive negative points for each
finance company loan.
TWO POWERFUL STRATEGIES THAT CAN GET YOUR APPLICATION APPROVED
Credit checks are requested by banks, lenders, and other
creditors to see if there are negative items in your file. The
more negative items you have, the less your chances of credit
will be. As we have seen, creditors look for stability and
reliability in an applicant. A steady source of income will
receive a high score, but even more important than an income
amount is a creditors belief and perception that you are both
willing and able to pay back a debt.
In other words, even if you fail to pass certain criteria or
formulas, your application can still be approved on another
level that will get you the credit you want no matter what a
scoring system profile says.
Extending credit to customers is the way the creditors make
money. If you convince them you are a good risk they will give
you what you want. Basically, there are two ways you can achieve
that goal.
1) You can bypass the normal scoring methods that are used by
impressing the person your application that you are sincere,
reliable, stable, and have the ability to make monthly payments
on a loan or credit card account.
2) You can tailor your answers to the applications questions and
in that manner fir into the right scoring mold of what a good
credit risk is, according to the formula they are using.
That doesn't mean you should lie on your application. It simply
means you should be aware that being compatible with certain
stereotypes will work in your favor. remember, a creditor can
still verify the information you list in an application. Still,
many people the truth to put themselves in a favorable position.
For example:
1) Some applicants will list their parent's, a friend's or a
relative's address as their own residence and indicate they have
lived there for years, knowing it probably won't be checked.
2) Provided an applicant has a friend or employer who will go
along with the, he can list a position and salary they don't
really receive. Then when the creditor calls to verify
employment the friend will support what the application has
claimed to be true.
3) Another way applicants instantly increase their salary is to
set up their own corporation. After issuing themselves private
stock with an inflated value, they list the stock as part of
their salary.
MORE HOT TIPS ON HOW YOU CAN STACK THE ODDS IN YOUR FAVOR
1) If you don't have a telephone get one installed. The
alternative is to make arrangement with the telephone company
and a friend or relative, to have your name listed with their
phone.
2) If you have more than one job, list the one that provides you
with the greatest income.
3) Add your income from all sources and place the total in your
gross income listing. Be prepared to submit a supplement to your
application if they want to verify your income with your
employer.
4) Many banks will have a list of "good" and "bad" reasons for
borrowing money. Unless you are applying for a secured loan, you
don't have to spend the money for the reason specified. Good
reasons include home improvement, education, loan to establish
credit, medical treatment for you or your family, and secured
loans for a home, car, boat, and other properties.
"Bad" reasons include loans that create another obligation such
as that created when you borrow money for a down payment and
then have two payments to make; money to pay fine or penalty;
money to consolidate debts, unless you are doing it to get a
lower interest rates; an unnecessary luxury item; money to
finance politics; and money that you loan to someone else. Use a
little common sense in determining what type of loan a creditor
may consider bad.
5) Banks use dependent figures to determine what your living
costs are. If you have more than two dependents you should
indicate how they earn their own way or supporting.
6) If you don't own your own home, counteract this by showing
how stable you are. For example, even though you have only
rented in a new location for a relatively short time, you lived
at your last residence for many years. You moved to improve
yourself in some way.
7) Even job changes can be counteracted if each change increased
your salary and improved your position.
8) Don't ever let a creditor guess as to whether or not you can
afford the extra obligation you are asking for. Make it obvious
by the amount of your income. If you have more income sources
than just your salary, include those amounts.
ALWAYS BE PERSISTENT AND NEVER GIVE UP!
If you complete an application and are still rejected the very
first thing you should do is be persistent and never give up.
There are many reasons why a person may be turned down for
credit, but whatever the reason, you have a legal right to ask
the creditor what their reason was.By knowing what some of the
main reasons are for denying credit you can put yourself in a
position whereby you can make necessary adjustments and avoid
negative effects in advance. If you are turned down, you can
then of course concentrate on those points when you reapply.
When you are dealing with creditors you will know who is the
cooperative sort, and who is not. If an unsecured loan does not
appear imminent, turn the conversation to a secured loan. Then
all you do is deposit an amount into savings account to serve as
collateral for the amount of credit you want to secure. In some
cases the creditor may take personal property as security. If
you go to the creditor and it's clear he has no imagination to
deal, go to another who is willing.
CONSIDER ASKING SOMEONE YOU KNOW TO CO-SIGN
A co-signer is someone who generally has better credit than the
person he is co-signing for. He is also the person a creditor
will go after first in the event you do not pay off your debt.
Why? Because they know that co-signers don't want their credit
ratings ruined and will quickly settle the obligation.
If you are trying to establish or rebuild credit, co-signers can
help you achieve that goal. Naturally you wouldn't need a
co-signer every time you apply for credit. After paying off one
obligation with a co-signer, it should be much easier to acquire
more credit on your own.Co-signers are usually friends or
relatives. When you find someone willing to help they should be
offered some compensation agreeable to both of you. Your
application for credit will be approved primarily on the
strength of your co-signer's credit.
HOW TO GET A VISA OR MASTERCARD
The tips and techniques described in this report are meant to
increase the odds for anyone who is absolutely certain they
cannot get a Visa/Mastercard through normal channels. You should
make every attempt to clean up your credit report by removing
negative items and replacing them with positive items. If you
have no credit at all, open an account at a local department
store. After a few months apply for your bankcard. If you are
rejected, find out why and correct the problem. If that doesn't
work, cultivate a relationship with your banker. Open other
accounts that are easier to obtain. Increase your income. Buy a
home. Make yourself a better credit risk on your credit report.
Ask a friend or relative to co-sign. After paying off that debt,
reapply on your own. Or, the fastest and easiest way to open a
Visa or Mastercard account in your own mane, is through a
secured account.
SECURED CREDIT CARDS
Secured Visa and Mastercard bank cards are issued by savings and
loan association throughout the U.S. The lender will ask you to
open a savings account. The funds placed into the savings
account are frozen as long as there is an outstanding balance on
the credit card. The savings account acts as security against
non-payment of charges made against the credit card. Then, in
the event a cardholder doesn't pay, funds from the frozen
account can be used to pay off the debt. This method completely
reduces any risk to the lender.
Requirements are often lowered by lending institutions that have
this program. So if you couldn't obtain a card through your
regular bank, chances are you will receive one through a secured
credit card program without a credit check.
About the author:
For a wide range of personal finance articles, loans, credit
cards, and debt reduction resources, visit
http://www.ReliefLoans.com.
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