In today’s economic environment, credit scores are more important than ever in borrowing. Sub-prime loans are drying up and the ones that remain are getting more costly in both fees and interest rates. Most financial experts agree that the days of cheap credit are gone for the foreseeable future.

With this in mind, below are the immediate actions you can take to begin rebuilding your credit score. Obviously these steps are not always easily achieved but each action is another step towards a better credit score:

• Avoid any new derogatory actions. Each new delinquency, collection, or charge-off on your credit report will affect your credit score for years to come. Often the only way to compensate for these negative attributes is with time. Avoid these actions by limiting your spending or restructuring your debit. Restructuring may be difficult with a low score so it is best to avoid the debt in the first place.

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While we don’t have any credit card debt now, except for 0% APR balance transfers, there was a time when we did. While we never let our credit cards get completely out of control, we did build up several thousand dollars on our credit cards when I first got out of college.

So having gotten into card debt and then climbed out of it, we’ve learned many of the causes of this financial pain. The fact is, we can talk ourselves into using our credit cards in ways that will hurt our finances down the road.

So here are 10 lies we tell ourselves that get us in credit card debt and keep us there.

It’s an emergency. Often we go into debt by convincing ourselves that we have an emergency. Certainly there are times when a true emergency arises. Medical expenses are a good example of a real crisis. But many times what we call an emergency isn’t really an emergency. Whether it’s a second car that needs repair, or even our child’s college education, we can often go without addressing what at first seems like an urgent expense. If life or liberty isn’t at stake, it’s probably not a true emergency.

We deserve it. This one has snagged us more than once. After working so hard to save money and spend wisely, sometimes we let our guard down under the guise of a reward. Perhaps you’ve had a hard week at work, and spending $150 on a fancy dinner that you can’t really afford seems like a good idea and something you’ve earned. The problem is that it’s like taking one step forward, two steps back. The “reward” just digs you deeper and deeper into debt.

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Nearly 34% of consumers said their credit card company had made changes to their card accounts, according to a survey from consumer education website Credit.com.

More than 1,000 people were interviewed in a telephone poll conducted from Friday through Sunday by GfK Custom Research North America.

Of those, 15% saw an increase in their interest rate, and 11% noticed an increased minimum payment requirement. Rewards programs were reduced for 8%, while 9% reported different due dates and 8% had their credit limits lowered.

In the end, 7% said their accounts are now closed. The answers total more than 34% because some respondents saw more than one change.

Source: http://latimesblogs.latimes.com/shopping_blog/2009/02/more-than-30-of.html

Credit card terms change

Nearly 34% of consumers said their credit card company had made changes to their card accounts, according to a survey commissioned by consumer education website Credit.com.

Of those, 15% saw an increase in their interest rate, and 11% noticed an increased minimum payment requirement. Rewards programs were reduced for 8%, while 9% reported their due dates had changed, 8% had their credit limits lowered, and 7% said their accounts were now closed. The answers total more than 34% because some respondents saw more than one change.

The survey had a margin of error of 3 percentage points, Credit.com said. Respondents were not asked to consider a specific time frame when forming their answers.

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Even in the best of times, carrying a balance on your credit card is a risky — and costly — proposition. These days, it can be downright foolish, at least if there’s a chance you might miss a payment or two.

Millions of cardholders have recently received letters from the likes of Citibank, Bank of America Corp., Wells Fargo & Co. and American Express Co. notifying them that their interest rates are going up, in some cases to 30% if a single payment is missed.

JPMorgan Chase & Co., the nation’s largest issuer of plastic, has begun charging hundreds of thousands of cardholders a $10 monthly fee for having carried large balances for more than a couple years.

Why? In part it’s because default rates are rising and banks are dealing with additional risk. But lawmakers and consumer advocates say the higher rates also reflect banks’ massive losses from betting wrong on the housing boom, and they’re basically sticking credit card customers with the tab.

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The national wave of auto dealership closures has come crashing down on thousands of people who are on the hook for used-car loans that dealers were supposed to absolve.

When a car buyer still owes money on a vehicle he is trading in, the dealer promises to pay off the outstanding loan, then resells the vehicle. But as more dealers go out of business, some are sticking consumers with the bill. Lenders can then go after the previous owner who thought the debt was paid, or repossess the car from the new owner who assumed it came with clear title.

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While the economy tumbles and the government rushes to help stop the housing crisis, another danger is lurking–in your wallet.

Credit cards are shaping up to be the next chapter in the financial meltdown, promising to stymie consumer spending, drag on the economy and force a whole new wave of financial difficulty on Americans.

On Monday, Capital One disclosed rising delinquencies and loan losses for the month of November because of unemployment and the weakening economy. Loans at least 30 days past due made up an annualized 4.7% of the portfolio, up from 4.48% in October and loans charged-off rose to an annualized 6.98% from 6.54% in October.

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Check out Mint.com for an exceptional money management solution. I’ve personally been using it for several months, and it’s great to see all my accounts in one spot, and view spending habits/trends.

It’s a very good solution to put your finances into prospective.