Archive for March, 2009
If you are cleaning up your credit report then you understand the importance of your credit score. Your credit score can impact your lifestyle more than by how much money you make.
With a bad credit score you may be having employers turn you away from a job. You may be unable to purchase a home or get approval for an auto loan or a credit card. On occasions when you are approved it is at sickening interest rates.
If you learn how the credit system works than you can use that knowledge to better your credit score. With a higher credit score you will be able to make the purchases you want or have extra money because you are not spending it on high interest rates.
When credit bureaus compute your credit score they use an algorithm or equation. They input your credit history and a computer calculates your credit score.
Your credit score is a way for lenders and employers to measure you. Lenders will often not look at any other factor other than your credit score when you apply for a credit line. You credit score determines how the credit world perceives you.
How do you use the credit system to your advantage? There are two factors that carry more weight than anything else in the credit system equation.
1. Remove negative accounts. Negative accounts on your credit report will do the most damage to your score and need to be removed.
2. Keep an unsecured revolving line of credit. This can be done by almost anyone.
The actual credit bureaus algorithms are protected and not released to the public. However upon review of thousands of credit files it has been found that having an open account is almost as important as removing negative credit items.
The unsecured line of credit will improve your credit score because:
1. Every time you pay your bill you are creating positive payment history. Just so you know the credit bureaus like this account to be aged or open for some time.
2. Improves your debt to credit ratio. The credit bureaus reward people who have high available credit and low outstanding debt.
Your open credit line will carry more influence on your score if it is unsecured. However if you can not be approved for an unsecured loan then I would suggest a secured credit card.
A credit line will help build credit however it is most important to remove bad credit items. If you are unable to get approval for new credit immediately and don’t want a secured credit line then remove bad credit and then reapply.
It is possible for everyone to achieve a 700 credit score for themselves. So start today and erase the derogatory marks and build positive marks on your credit report.
By: Justin Hutto
About the Author:
With a bad credit score you may be having employers turn you away from a job. You may be unable to purchase a home or get approval for an auto loan or a credit card. On occasions when you are approved it is at sickening interest rates.
If you learn how the credit system works than you can use that knowledge to better your credit score. With a higher credit score you will be able to make the purchases you want or have extra money because you are not spending it on high interest rates.
When credit bureaus compute your credit score they use an algorithm or equation. They input your credit history and a computer calculates your credit score.
Your credit score is a way for lenders and employers to measure you. Lenders will often not look at any other factor other than your credit score when you apply for a credit line. You credit score determines how the credit world perceives you.
How do you use the credit system to your advantage? There are two factors that carry more weight than anything else in the credit system equation.
1. Remove negative accounts. Negative accounts on your credit report will do the most damage to your score and need to be removed.
2. Keep an unsecured revolving line of credit. This can be done by almost anyone.
The actual credit bureaus algorithms are protected and not released to the public. However upon review of thousands of credit files it has been found that having an open account is almost as important as removing negative credit items.
The unsecured line of credit will improve your credit score because:
1. Every time you pay your bill you are creating positive payment history. Just so you know the credit bureaus like this account to be aged or open for some time.
2. Improves your debt to credit ratio. The credit bureaus reward people who have high available credit and low outstanding debt.
Your open credit line will carry more influence on your score if it is unsecured. However if you can not be approved for an unsecured loan then I would suggest a secured credit card.
A credit line will help build credit however it is most important to remove bad credit items. If you are unable to get approval for new credit immediately and don’t want a secured credit line then remove bad credit and then reapply.
It is possible for everyone to achieve a 700 credit score for themselves. So start today and erase the derogatory marks and build positive marks on your credit report.
By: Justin Hutto
About the Author:
For more tips on how to remove bad credit items such as a charge off or for a free sample dispute letter or to read an article about how to remove nco financial visit us.
Shaunna Vandeyacht
The credit score is a number that the lenders use to estimate the risk. It is a fact that experience has shown them that borrowers with higher credit scores are less likely to have that loan. Obtaining your free credit report is really important for you to have knowledge and control over your financial information. When obtaining your free credit report, keep in mind that you should have no obligation to commitment to anything. In addition, if you are trying to acquire your free credit report online, never use a public computer to access thins kind of information. If you are to use a public computer to access your free credit report, there is a possibility that your personal information will be stored on that computer. You do not want somebody to have access to your personal stuff. A free credit report helps people protect themselves from identity theft and fraudulent credit application. When you see something that looks suspicious, remember that you have to contact the credit company to report it, immediately. When you obtain your free credit report annually, there is no reason to go out every year because it will be provided to you automatically. Remember that just because you never had a load or credit card, it does not mean you cannot have a view of your free credit report. The annual reports can be acquired from each of the credit bureaus.
Credit scores are sometimes called FICO scores because the software used to calculate a great number of credit scores were created by Fair Isaac Corporation or FICO.
The FICO or the Fair Isaac Corporation credit scores are the numeric values from 300 to 850 that is used to indicate your past credit habits. The score provides the lenders an indication of the risk they will take if they will loan you the money. The higher the score, the more likely you are to repay the loan when it is already due. Remember that the higher your credit score, the better the interest rate that you will get.
A first step to having a good FICO score is to know where you are. There are so many people looking for a way to get a free FICO score, however it may be tricky. Remember that there are a couple of things that you should watch when you are trying to get a free FICO score.
First thing is to look for a free online FICO score; this is not hard since you will be blasted with many advertisements once you type in the word. There are over a hundred companies looking to give you a free credit score. Truth is, not all are equally created. Fair Isaac developed the FICO score and it is now used by over ninety percent of all lenders in the Unites States alone. Seeing the success of Fair Isaac, credit bureaus decided to get into the credit score business since they saw that it is very profitable. The scores that are commonly offered when you are looking to get a free FICO score may not actually be a real FICO score. There are so many different ways to score a credit and one of them is the FICO score. All you need is to make sure it does say FICO on the result.
By: CreditScoreAide .com
About the Author:
Credit scores are sometimes called FICO scores because the software used to calculate a great number of credit scores were created by Fair Isaac Corporation or FICO.
The FICO or the Fair Isaac Corporation credit scores are the numeric values from 300 to 850 that is used to indicate your past credit habits. The score provides the lenders an indication of the risk they will take if they will loan you the money. The higher the score, the more likely you are to repay the loan when it is already due. Remember that the higher your credit score, the better the interest rate that you will get.
A first step to having a good FICO score is to know where you are. There are so many people looking for a way to get a free FICO score, however it may be tricky. Remember that there are a couple of things that you should watch when you are trying to get a free FICO score.
First thing is to look for a free online FICO score; this is not hard since you will be blasted with many advertisements once you type in the word. There are over a hundred companies looking to give you a free credit score. Truth is, not all are equally created. Fair Isaac developed the FICO score and it is now used by over ninety percent of all lenders in the Unites States alone. Seeing the success of Fair Isaac, credit bureaus decided to get into the credit score business since they saw that it is very profitable. The scores that are commonly offered when you are looking to get a free FICO score may not actually be a real FICO score. There are so many different ways to score a credit and one of them is the FICO score. All you need is to make sure it does say FICO on the result.
By: CreditScoreAide .com
About the Author:
CreditScoreAide.com is your source of information on credit repair, credit reporting and credit scores. Learn how to save thousands of dollars by improving your credit score. Available on the website you will find information on poor credit loans, credit repair attorneys, and good credit scores.
Charles Redus
Raise credit scores 50 points in 5 days! Sounds great right? Maybe…
A mortgage company or bank can offer a service called ‘rapid rescore’ to get something corrected off your credit report. Here is a brief walk through of this method to raise credit scores. The rapid rescore strategy requires proper paperwork. The proof must come from the creditor directly.
Some examples of corrections are:
a letter stating the account is not your account
a letter stating the account was paid satisfactorily
a release of lien
a satisfaction of judgment
a bankruptcy discharge
a letter for deletion of collection account or any relevant evidence
a letter correcting (and raising) available credit balance
a letter changing the status of an account from ‘delinquent’ to ‘current’
a letter to update high credit limit
Checklist
1. The creditor’s letter must be signed and on their stationary.
2. It must include the creditor’s contact name, phone number, your name and address, and a full or partial account number that matches the credit bureau entry number.
3. The letter must state what action the lender is doing to correct in the credit file — like change the status of an account from ‘delinquent’ to ‘current.’
4. Next the lender forwards the letter to the credit bureau, does a telephone verification and a new credit report is issued with an updated credit score.
The rapid rescore system works best if you are trying to raise credit scores fast to move up from one credit rating to another. Some mortgage companies offer a ‘what if’ scenario for rapid rescoring. Simply put, the account that is to be updated is entered into the ‘what if’ scenario and the program calculates a new credit score.
For example, your mortgage lender runs your credit report and your scores are 660, 680, and 710. Using a rapid rescore program, the results tell you what you can you do to increase your score 10 to 50 points. The system may recommend that you pay off some credit cards, pay off a collection, or other options. The main idea is to get you to the next level so the bank can offer better rates and options for your loan. This tool provides an educated guess on how to raise credit scores so it is not a guarantee of how the rescore will ultimately impact the credit score.
Your lender may simply evaluate how the proposed correction would impact the major score factors that are listed on your credit report. If that correction affects a major score factor, then its likely it would increase your credit score and worth pursuing.
Rapid rescore is not cheap. Typically it costs a lender $30 to $50 to run it against each credit bureau. The lender may choose to eat the cost or they may charge it back to the borrower. It is expensive but in most cases it works well for people looking to raise credit scores fast so they can pay 5% down payment instead of 10%, or avoid a high interest rate, or eliminate PMI or other costs related to mortgages.
By: Kate Rieger
About the Author:
A mortgage company or bank can offer a service called ‘rapid rescore’ to get something corrected off your credit report. Here is a brief walk through of this method to raise credit scores. The rapid rescore strategy requires proper paperwork. The proof must come from the creditor directly.
Some examples of corrections are:
a letter stating the account is not your account
a letter stating the account was paid satisfactorily
a release of lien
a satisfaction of judgment
a bankruptcy discharge
a letter for deletion of collection account or any relevant evidence
a letter correcting (and raising) available credit balance
a letter changing the status of an account from ‘delinquent’ to ‘current’
a letter to update high credit limit
Checklist
1. The creditor’s letter must be signed and on their stationary.
2. It must include the creditor’s contact name, phone number, your name and address, and a full or partial account number that matches the credit bureau entry number.
3. The letter must state what action the lender is doing to correct in the credit file — like change the status of an account from ‘delinquent’ to ‘current.’
4. Next the lender forwards the letter to the credit bureau, does a telephone verification and a new credit report is issued with an updated credit score.
The rapid rescore system works best if you are trying to raise credit scores fast to move up from one credit rating to another. Some mortgage companies offer a ‘what if’ scenario for rapid rescoring. Simply put, the account that is to be updated is entered into the ‘what if’ scenario and the program calculates a new credit score.
For example, your mortgage lender runs your credit report and your scores are 660, 680, and 710. Using a rapid rescore program, the results tell you what you can you do to increase your score 10 to 50 points. The system may recommend that you pay off some credit cards, pay off a collection, or other options. The main idea is to get you to the next level so the bank can offer better rates and options for your loan. This tool provides an educated guess on how to raise credit scores so it is not a guarantee of how the rescore will ultimately impact the credit score.
Your lender may simply evaluate how the proposed correction would impact the major score factors that are listed on your credit report. If that correction affects a major score factor, then its likely it would increase your credit score and worth pursuing.
Rapid rescore is not cheap. Typically it costs a lender $30 to $50 to run it against each credit bureau. The lender may choose to eat the cost or they may charge it back to the borrower. It is expensive but in most cases it works well for people looking to raise credit scores fast so they can pay 5% down payment instead of 10%, or avoid a high interest rate, or eliminate PMI or other costs related to mortgages.
By: Kate Rieger
About the Author:
Kathleen Rieger is a Certified Identity Theft Risk Management Specialist.
Drop by
http://www.extreme-debt-makeover.com/kentucky-credit-repair.html for a Free
copy of her online Credit Rejuvenation course and to book yourself a
consultation where she helps you to get to the closing table — fast.
Marc
Many people are trying to get a low interest loan but are ignorance of the bad credit score they had previously created by default payments. In order to get the best of your loans, you need a healthy FICO score. Even you have bad credit previously, there are ways to improve it overtime. There is no way out other than getting back on track to rebuild your credit history.
One way to repair an unfavorable credit history begins with paying off all the debts that you have previously owed. Regardless of the reasons that have led to your defaulting on your payments, when things improve financially, you can start working your way out of the red into the black again. Please bear in mind even you have start to rebuild credit history, the bad marks may still be on your credit reports. So what can you do? The few steps below will provide a little help if you have not already done so.
Rebuilding credit will take a little while, so you have to be patience. One year is a realistic plan to improve your FICO score. By then you will restore your credibility for any future loans.
Secured Credit Card
You may want to start with a secured credit card. It requires a deposit as your credit limit. Your credit limit will be raised in future if you have shown good financial behavior. It is likely many credit card companies will reject people with bad credit history but secured credit card will help you to recover your credit fast although these cards are not your preferred choice.
Gas Station Credit Card
If you need to buy gas, send your car for service, or make payment for a meal in the gas station, you can consider applying for Gas station credit card. If use it carefully, it can help to rebuild credit history.
Department Store Credit Card
Department store credit cards have their good sides as well. Since the goods sold in a department store are quite varied, you’ll practically be able to buy just about anything you need there. Payment by credit cards is simple but also remember to keep your card balance each time you make a purchase.
Secured Personal Loan
One of the higher risk options are secured personal loans since it involves your property as collateral to the lender and it normally involves larger amount of money. Most lenders favor this type of loans since they are secured against your assets.
Remember do not default on payments under any circumstances, even on small loans. One thing most people can easily forget is to pay more than the minimum payments each month if you could not afford to pay off the credit card. It helps to reduce debts and interest you have to pay later.
Please bear in mind your credit cannot be fixed overnight or even over a very short time. Be realistic and slowly wait for the time to come. Anyone who claims they can restore your credit trustworthiness in no time is at least nave, if not deceitful. But, with patience and consistent compliance with your payment duties, things will get better.
By: James Ma
About the Author:
One way to repair an unfavorable credit history begins with paying off all the debts that you have previously owed. Regardless of the reasons that have led to your defaulting on your payments, when things improve financially, you can start working your way out of the red into the black again. Please bear in mind even you have start to rebuild credit history, the bad marks may still be on your credit reports. So what can you do? The few steps below will provide a little help if you have not already done so.
Rebuilding credit will take a little while, so you have to be patience. One year is a realistic plan to improve your FICO score. By then you will restore your credibility for any future loans.
Secured Credit Card
You may want to start with a secured credit card. It requires a deposit as your credit limit. Your credit limit will be raised in future if you have shown good financial behavior. It is likely many credit card companies will reject people with bad credit history but secured credit card will help you to recover your credit fast although these cards are not your preferred choice.
Gas Station Credit Card
If you need to buy gas, send your car for service, or make payment for a meal in the gas station, you can consider applying for Gas station credit card. If use it carefully, it can help to rebuild credit history.
Department Store Credit Card
Department store credit cards have their good sides as well. Since the goods sold in a department store are quite varied, you’ll practically be able to buy just about anything you need there. Payment by credit cards is simple but also remember to keep your card balance each time you make a purchase.
Secured Personal Loan
One of the higher risk options are secured personal loans since it involves your property as collateral to the lender and it normally involves larger amount of money. Most lenders favor this type of loans since they are secured against your assets.
Remember do not default on payments under any circumstances, even on small loans. One thing most people can easily forget is to pay more than the minimum payments each month if you could not afford to pay off the credit card. It helps to reduce debts and interest you have to pay later.
Please bear in mind your credit cannot be fixed overnight or even over a very short time. Be realistic and slowly wait for the time to come. Anyone who claims they can restore your credit trustworthiness in no time is at least nave, if not deceitful. But, with patience and consistent compliance with your payment duties, things will get better.
By: James Ma
About the Author:
Need urgent loan when you have bad credit? Visit bad credit repair loan for more details. For more information on rebuild credit, visit rebuild secured credit card and credit consumer counseling to avoid scams.
Ferdinand Skreen
You are shocked when your loan is denied, or maybe you were approved, but the interest rate is much higher than you anticipated. How can that be you say? My credit score is good, I know I checked. Maybe it’s not as good as you think. It all depends on there you got it and what kind of credit score it is.
The fact is there are several different credit scoring methods. Credit scores calculated from the same credit reports can differ substantially from credit scoring method to credit scoring method. So how can you ever know what your credit score really is? Well, luckily, 75% percent of lenders use FICO scores exclusively and you can purchase FICO scores yourself–you just have to know where to go. (www.myfico.com)
FICO credit scoring is a numeric method of scoring your credit worthiness developed by Fair Isaac and Company. Your credit score is a number between 300 and 850 that tells creditors how likely you are to pay your bills. The higher the number, the better it looks to potential lenders and creditors.
The three major credit bureaus each have their own version of the FICO score: Equifax uses the Beacon system, TransUnion uses the Empirica system, and Experian uses the Experian/Fair Isaac system. Despite each credit bureaus’ use of their own versions, all systems are based the original Fair Isaac FICO scoring method, so each credit score calculated with these systems are generally called FICO scores. However, although most lenders do use FICO scoring, some lenders may have their own scoring methods.
There is only one place where you can get your FICO score from all three bureaus and that is at www.myfico.com. If you order your credit score from anywhere else, again be aware that these scores are “FAKOs” (or “fake”) and can differ considerably from your FICO credit scores.
Adding to the confusion is the credit bureaus themselves. Recently, Experian revealed that the national average credit score of its consumers is 678. This is very misleading to the average consumer. When you buy your credit report and score directly from Experians website, you are getting what they call the “PLUS Score,” which is NOT a FICO score, and is NOT used by lenders anywhere. (Equifax is the exception–you can buy your FICO score directly from them at their website; however, the only place to get all three scores together is at www.myfico.com.) The 678 PLUS Score reported by Experian is actually the average of consumers’ PLUS Scores, not their FICO Scores.
Clearly, the PLUS Score (and all Non-FICO scores) are useless. Not only that, but such hype misleads consumers into purchasing their PLUS Score thinking that they are getting the same credit score that their lender will use. Non-FICO scores are worthless not matter what the credit bureaus or any website selling non-FICO scores claim. Even a few points difference in your credit score can mean confronting the reality of the loss of thousands of dollars out of youSr pocket–a loss that you probably didn’t plan for. The next time you want the most accurate credit score available, do yourself a favor and get the industry standard: the FICO credit score.
By: William Brooks
About the Author:
The fact is there are several different credit scoring methods. Credit scores calculated from the same credit reports can differ substantially from credit scoring method to credit scoring method. So how can you ever know what your credit score really is? Well, luckily, 75% percent of lenders use FICO scores exclusively and you can purchase FICO scores yourself–you just have to know where to go. (www.myfico.com)
FICO credit scoring is a numeric method of scoring your credit worthiness developed by Fair Isaac and Company. Your credit score is a number between 300 and 850 that tells creditors how likely you are to pay your bills. The higher the number, the better it looks to potential lenders and creditors.
The three major credit bureaus each have their own version of the FICO score: Equifax uses the Beacon system, TransUnion uses the Empirica system, and Experian uses the Experian/Fair Isaac system. Despite each credit bureaus’ use of their own versions, all systems are based the original Fair Isaac FICO scoring method, so each credit score calculated with these systems are generally called FICO scores. However, although most lenders do use FICO scoring, some lenders may have their own scoring methods.
There is only one place where you can get your FICO score from all three bureaus and that is at www.myfico.com. If you order your credit score from anywhere else, again be aware that these scores are “FAKOs” (or “fake”) and can differ considerably from your FICO credit scores.
Adding to the confusion is the credit bureaus themselves. Recently, Experian revealed that the national average credit score of its consumers is 678. This is very misleading to the average consumer. When you buy your credit report and score directly from Experians website, you are getting what they call the “PLUS Score,” which is NOT a FICO score, and is NOT used by lenders anywhere. (Equifax is the exception–you can buy your FICO score directly from them at their website; however, the only place to get all three scores together is at www.myfico.com.) The 678 PLUS Score reported by Experian is actually the average of consumers’ PLUS Scores, not their FICO Scores.
Clearly, the PLUS Score (and all Non-FICO scores) are useless. Not only that, but such hype misleads consumers into purchasing their PLUS Score thinking that they are getting the same credit score that their lender will use. Non-FICO scores are worthless not matter what the credit bureaus or any website selling non-FICO scores claim. Even a few points difference in your credit score can mean confronting the reality of the loss of thousands of dollars out of youSr pocket–a loss that you probably didn’t plan for. The next time you want the most accurate credit score available, do yourself a favor and get the industry standard: the FICO credit score.
By: William Brooks
About the Author:
William Brooks – For the shocking truth about debt and steps to decrease your debt and put money in your pocket tomorrow, go download your FREE report now! “The Underground “Debt” Railroad” Free Download Click Here: Free Report
Lashanda Liukko
It is quite undeniable that increasing my credit score is one of the hardest things which I have encountered in my whole life. This is maybe because of the fact that I’m a bit pressured with anything that has something to do with my financial status specifically with my credit rating or score. It is just that I do not want to have problems concerning my creditability. Besides, who on earth would want to have credit score issues on his or her life? None, I guess. Thus, I have to secure the standing of my credit rating at all times as well as be aware on how I can raise my credit score fast and without any hassles at all.
If truth be told, there are a lot of ways on how to raise credit score. However, I have to see to it to choose the most effective ways as much as possible in order to be certain that my credit score will always be in a good standing. As a matter of fact, some of the most effective ways on how I can raise my credit score fast are the following:
Grab a copy of the USA credit report and evaluate it. Credit reports are actually being provided annually by any of the three major credit reporting bureaus in this day and age. These three credit bureaus are the TransUnion, Experian, and Equifax. After acquiring a credit report, it is deemed to be essential to evaluate and scrutinize it so that errors can be determined immediately. Pay all debts promptly. This is actually the easiest and simplest way to increase credit scores. Hence, it is just safe to say that paying debts on time and without any delay entails good results in the long run. Never close old accounts. Honestly speaking, old accounts do help in increasing the credit scores quickly. This is due to the fact that old accounts can make credit history much longer which can then result to a higher credit rating or score.
Indeed, there are certain ways on how I can raise my credit score fast and without any troubles at all. I simply have to bear all the aforementioned ways into my mind in order to secure the good standing of my credit rating or score. After all, the ways mentioned above are just simple.
By: Robin Lozano
About the Author:
If truth be told, there are a lot of ways on how to raise credit score. However, I have to see to it to choose the most effective ways as much as possible in order to be certain that my credit score will always be in a good standing. As a matter of fact, some of the most effective ways on how I can raise my credit score fast are the following:
Grab a copy of the USA credit report and evaluate it. Credit reports are actually being provided annually by any of the three major credit reporting bureaus in this day and age. These three credit bureaus are the TransUnion, Experian, and Equifax. After acquiring a credit report, it is deemed to be essential to evaluate and scrutinize it so that errors can be determined immediately. Pay all debts promptly. This is actually the easiest and simplest way to increase credit scores. Hence, it is just safe to say that paying debts on time and without any delay entails good results in the long run. Never close old accounts. Honestly speaking, old accounts do help in increasing the credit scores quickly. This is due to the fact that old accounts can make credit history much longer which can then result to a higher credit rating or score.
Indeed, there are certain ways on how I can raise my credit score fast and without any troubles at all. I simply have to bear all the aforementioned ways into my mind in order to secure the good standing of my credit rating or score. After all, the ways mentioned above are just simple.
By: Robin Lozano
About the Author:
Written by Robin Lozano. Read more information on how to raise my credit score and how do I get my free credit report every month.
Tanja Frances
If there is one question I’m asked by consumers more than any other about credit, it’s this “What’s the fastest way to raise my credit score?”. My response is always the same “How much do you want to raise it?”
If you wish to increase your score from 580 to 650 then your strategy will be very different from someone wanting to go from 670 to 725. Why? Because you starting point is different which requires a different approach. Also, while the removal of negative items from a report will almost always lead to an increase in score, it’s a basic concept at best. Therefore, within this article, we’ll discuss somewhat inside techniques known by very few (since this is what our company specializes in publishing).
In relation to just removing negative items, these are techniques which you can use even if you have NO derogatory information on your credit report. We’ll start with the most overlooked strategy first and that’s your…
DEBT to CREDIT RATIO: The most fraudulent belief I’ve been hearing for over 15 years is “I have excellent credit, I pay all my bills off in full every month!” This is a false belief for one to buy into and understanding your debt to credit ratio holds the key to getting your “credit mindset” right.
Your debt to credit ratio is your ratio of debt to total available credit you have been extended (revolving accounts only). For example. If you have $10,000 in total unsecured revolving credit accounts and you’re currently in debt $2500, then your debt to credit ratio is 25%. Since the main way lenders make money is by charging interest, one of the elements of the credit scoring model is driven by your ability to maintain balances and pay over time. This shows your true (long term) credit worthiness which is most profitable to lenders since they make money primarily via interest and not annual fees.
Over the years we’ve discovered without question that carrying the proper debt to credit ratio will boost your score faster than paying off your bills in full each month. I have argued with the Better Business Bureau on this topic and they still disagree (despite my sending them proof from Fair Isaacs own website www.MyFico.com the organization which invented the credit scoring software used by credit bureaus).
Of course, what do you do if you’re like most Americans and your debt to credit ratio is too high? For example. You have $10,000 in unsecured revolving accounts but you owe $8500, thereby giving you an 85% debt to credit ratio. How can you bring it down without selling everything you own? The answer is simple and takes us to the next technique which is…
SUB-PRIME MERCHANDISE CARDS: The single most cost effective (and powerful) tool for consumers to increase their high credit limit and decrease their debt to credit ratio is the use of Sub-Prime Merchandise Cards which report to one of more of the major credit bureaus.
Unfortunately, despite their immense benefits, these are the most misunderstood cards in the credit industry. A large portion of the misunderstanding is due to marketers misrepresenting the cards and the growing number of companies promoting them. When you learn how they work one quickly understands why they have been the subject of much misrepresentation.
A Sub-Prime Merchandise Card is nothing more than a card attached to a line of credit which allows you to buy merchandise from a specific vendor (usually the company that sold you the card). The merchandise (in most cases) will be purchased through a catalog or online mall.
Where the problem arises is that the cards are marketed almost exclusively to the sub prime market via email, telemarketing and direct mail etc. The reason for this is they can advertise almost irresistible offers like “$5,000 Credit Card… GUARANTEED! No Credit Check! NO Cosigner! You cannot be turned down!” or “Unsecured $10,000 Credit Line! Everyone Approved!”. I’m sure you get the idea…
While there are many companies which do this and are a “shady at best”, there are a few which do it legitimately and it’s the best kept secret to build your credit and build it fast.
Here’s how it works: the company approves anyone with a pulse (literally) and gives them a card for $2,500 to $12,500 with NO credit check and NO cosigner. However, the card is only good for merchandise through their website or catalogs and the consumer is required to put down a deposit on whatever they purchase. After the deposit is paid, the remaining balance is financed on the card.
For example. A person buys $1,000 worth of merchandise. Their deposit is $300 so they then finance $700 on their merchandise card and make payments. Sound like a scam? If you say “Yes” like most people then you’re missing the point… big time.
With a legitimate Sub-Prime Merchandise Card your credit line WILL be reported to at least one major credit bureau (or more). This means if you get a $5,000 card and you finance $500, on your credit report it will look like any other credit card and will do three extremely important things for you.
1.) It will increase your current “High Credit Limit” by $5,000 almost overnight as the account “looks” like any other unsecured revolving account.
2.) By carrying a small outstanding balance it will positively impact your credit report by building and showing potential lenders your credit worthiness.
3.) With a good payment history you are virtually guaranteed to receive “legitimate” pre-approved credit offers in the future due to other lenders renting your name from the credit bureaus.
This technique is hard to beat for both cost and effectiveness. Of course, the whole key is knowing exactly which cards report to the credit bureau and offer the best rates. The only thing more effective is…
PIGGYBACKING: Despite its’ virtually unlimited potential, piggybacking is not used by nearly as many consumers as it should be. It’s easy, effective, and extremely fast. Unfortunately, it’s mostly used among parents and siblings while those who can really benefit stay in the dark.
How it works. Almost every credit card or credit account will allow the primary account holder to add on (at a later date) what’s known as an “Authorized User” or “Secondary Account Holder”. In most cases, when this is done, the entire account history (retroactively) gets posted to the authorized users credit report regardless of their current age or credit history!
For example. If it’s a credit card with a $10,000 limit which has been paid as agreed for the last 10 years, then that complete history will be posted to the authorized users’ credit report. I once saw a clients’ credit report who used this technique with his mother. He was only 24 at the time and he had a $15,000 Gold credit card on his report with history going back 11 years! I laughed as I thought to myself that this kid would have had to be approved when he was 13 years old for this account to be his!
As you can see, this strategy is usually only used by parents and their children and in most cases with no regard to the benefits the children are reaping credit wise! In fact, in recent years, due to its’ effectiveness, this technique has led individuals with excellent credit scores to “rent out” authorized user accounts on one or even multiple credit cards in return for a fee! I once recall seeing an ad in USA TODAY for just such an opportunity. Like most good credit loopholes, I’m sure this methods’ days are numbered much like what may be the case with…
ADVANCED CREDIT PROFILING: This is a strategy while not complex, can be taken to very complex levels. Even in its’ most basic form, it’s taken advantage of by very, very few. It involves intentionally building your credit report in a way which creates a “profile” that closely fits the criteria of most lenders (as well as the overall credit scoring system). Again, this is a technique which can be used in a myriad of complex ways, but for simplicity I will explain it in its’ most basic form.
While many consumers will boast when they have 10, 20, 30 or even 50 thousand dollars worth of credit cards on their report, many of these same people do NOT have even one mortgage, automotive loan or lease, equipment loan or a even a line of credit with a local bank or credit union. These other forms of credit create a much more well rounded credit profile for the consumer. This is achieved by showing greater credit account diversity and experience with multiple types of credit due to the various lines held.
For example. A person with $50K in credit cards does not represent near the credit experience as a person with the same $50K along with a mortgage, an automotive loan and an equipment lease. We have clients who have financed vehicles not because they had to (or even wanted to) but because they “needed to” in order to create a credit profile that would position them in the future to secure the lowest possible rate on a mortgage when they applied and needed it.
More complex forms of Advance Credit Profiling involve one subscribing to affluent or semi-affluent business and professional publications and organizations. These would include magazines, newsletters, trade journals and national associations. The goal is to get ones name into the databases of these publications and organizations. Why? To get on highly targeted lists in order to receive select credit offers.
Marketers of credit offers have found that simply renting names of consumers from the credit bureaus does not provide enough information about the person as a credit risk anymore. Therefore, it is speculated that many will rent a list from the credit bureau and then cross-reference this list against another list they have secured from a consumer source such as an affluent business or professional publication, trade journal or organization.
By crossing the two lists together the marketers find the names contained on both lists. This in turn provides them with one highly refined and targeted list to mail their offer to. This results in shortening the process of securing a new quality account holder thus lower the overall account acquisition cost of new accounts.
When a consumer learns how to intentionally put themselves into these databases to wind up on these refined lists, the credit building process is sped up exponentially. Of course, many would call this “highly speculative” but we have undeniable experience that it works.
DEPOSIT LOAN PROGRAMS: This is a technique so unbelievable that I myself proclaimed it had to be a scam before researching the facts. It allows the consumer (or business) to have a $25,000 to $250,000 loan appear on their credit report as “Paid as Agreed” by way of very creative financing. This method is extremely effective and not within the budget of most ($750 to $7,500 upfront). Also, because this technique takes advantage of certain banking laws, I have reason to believe it could be made unavailable at any time if those banking laws were to change. This method can be used with consumer credit files on SSN’s as well as business and corporate credit files done on TIN’s as well as Dunn and Bradstreet.
In the end, all of us need to remember that today our credit score is more important than it has ever been in the history of the credit reporting system. While credit miracles don’t happen overnight, you can create your own credit miracles by applying simple insider strategies consistently over time. Before you know it, you’re a proud member of the 700 Club. The “700 Plus Credit Score” club that is!
www.Credit-Secrets-Bible.net
By: Jay Peters
About the Author:
If you wish to increase your score from 580 to 650 then your strategy will be very different from someone wanting to go from 670 to 725. Why? Because you starting point is different which requires a different approach. Also, while the removal of negative items from a report will almost always lead to an increase in score, it’s a basic concept at best. Therefore, within this article, we’ll discuss somewhat inside techniques known by very few (since this is what our company specializes in publishing).
In relation to just removing negative items, these are techniques which you can use even if you have NO derogatory information on your credit report. We’ll start with the most overlooked strategy first and that’s your…
DEBT to CREDIT RATIO: The most fraudulent belief I’ve been hearing for over 15 years is “I have excellent credit, I pay all my bills off in full every month!” This is a false belief for one to buy into and understanding your debt to credit ratio holds the key to getting your “credit mindset” right.
Your debt to credit ratio is your ratio of debt to total available credit you have been extended (revolving accounts only). For example. If you have $10,000 in total unsecured revolving credit accounts and you’re currently in debt $2500, then your debt to credit ratio is 25%. Since the main way lenders make money is by charging interest, one of the elements of the credit scoring model is driven by your ability to maintain balances and pay over time. This shows your true (long term) credit worthiness which is most profitable to lenders since they make money primarily via interest and not annual fees.
Over the years we’ve discovered without question that carrying the proper debt to credit ratio will boost your score faster than paying off your bills in full each month. I have argued with the Better Business Bureau on this topic and they still disagree (despite my sending them proof from Fair Isaacs own website www.MyFico.com the organization which invented the credit scoring software used by credit bureaus).
Of course, what do you do if you’re like most Americans and your debt to credit ratio is too high? For example. You have $10,000 in unsecured revolving accounts but you owe $8500, thereby giving you an 85% debt to credit ratio. How can you bring it down without selling everything you own? The answer is simple and takes us to the next technique which is…
SUB-PRIME MERCHANDISE CARDS: The single most cost effective (and powerful) tool for consumers to increase their high credit limit and decrease their debt to credit ratio is the use of Sub-Prime Merchandise Cards which report to one of more of the major credit bureaus.
Unfortunately, despite their immense benefits, these are the most misunderstood cards in the credit industry. A large portion of the misunderstanding is due to marketers misrepresenting the cards and the growing number of companies promoting them. When you learn how they work one quickly understands why they have been the subject of much misrepresentation.
A Sub-Prime Merchandise Card is nothing more than a card attached to a line of credit which allows you to buy merchandise from a specific vendor (usually the company that sold you the card). The merchandise (in most cases) will be purchased through a catalog or online mall.
Where the problem arises is that the cards are marketed almost exclusively to the sub prime market via email, telemarketing and direct mail etc. The reason for this is they can advertise almost irresistible offers like “$5,000 Credit Card… GUARANTEED! No Credit Check! NO Cosigner! You cannot be turned down!” or “Unsecured $10,000 Credit Line! Everyone Approved!”. I’m sure you get the idea…
While there are many companies which do this and are a “shady at best”, there are a few which do it legitimately and it’s the best kept secret to build your credit and build it fast.
Here’s how it works: the company approves anyone with a pulse (literally) and gives them a card for $2,500 to $12,500 with NO credit check and NO cosigner. However, the card is only good for merchandise through their website or catalogs and the consumer is required to put down a deposit on whatever they purchase. After the deposit is paid, the remaining balance is financed on the card.
For example. A person buys $1,000 worth of merchandise. Their deposit is $300 so they then finance $700 on their merchandise card and make payments. Sound like a scam? If you say “Yes” like most people then you’re missing the point… big time.
With a legitimate Sub-Prime Merchandise Card your credit line WILL be reported to at least one major credit bureau (or more). This means if you get a $5,000 card and you finance $500, on your credit report it will look like any other credit card and will do three extremely important things for you.
1.) It will increase your current “High Credit Limit” by $5,000 almost overnight as the account “looks” like any other unsecured revolving account.
2.) By carrying a small outstanding balance it will positively impact your credit report by building and showing potential lenders your credit worthiness.
3.) With a good payment history you are virtually guaranteed to receive “legitimate” pre-approved credit offers in the future due to other lenders renting your name from the credit bureaus.
This technique is hard to beat for both cost and effectiveness. Of course, the whole key is knowing exactly which cards report to the credit bureau and offer the best rates. The only thing more effective is…
PIGGYBACKING: Despite its’ virtually unlimited potential, piggybacking is not used by nearly as many consumers as it should be. It’s easy, effective, and extremely fast. Unfortunately, it’s mostly used among parents and siblings while those who can really benefit stay in the dark.
How it works. Almost every credit card or credit account will allow the primary account holder to add on (at a later date) what’s known as an “Authorized User” or “Secondary Account Holder”. In most cases, when this is done, the entire account history (retroactively) gets posted to the authorized users credit report regardless of their current age or credit history!
For example. If it’s a credit card with a $10,000 limit which has been paid as agreed for the last 10 years, then that complete history will be posted to the authorized users’ credit report. I once saw a clients’ credit report who used this technique with his mother. He was only 24 at the time and he had a $15,000 Gold credit card on his report with history going back 11 years! I laughed as I thought to myself that this kid would have had to be approved when he was 13 years old for this account to be his!
As you can see, this strategy is usually only used by parents and their children and in most cases with no regard to the benefits the children are reaping credit wise! In fact, in recent years, due to its’ effectiveness, this technique has led individuals with excellent credit scores to “rent out” authorized user accounts on one or even multiple credit cards in return for a fee! I once recall seeing an ad in USA TODAY for just such an opportunity. Like most good credit loopholes, I’m sure this methods’ days are numbered much like what may be the case with…
ADVANCED CREDIT PROFILING: This is a strategy while not complex, can be taken to very complex levels. Even in its’ most basic form, it’s taken advantage of by very, very few. It involves intentionally building your credit report in a way which creates a “profile” that closely fits the criteria of most lenders (as well as the overall credit scoring system). Again, this is a technique which can be used in a myriad of complex ways, but for simplicity I will explain it in its’ most basic form.
While many consumers will boast when they have 10, 20, 30 or even 50 thousand dollars worth of credit cards on their report, many of these same people do NOT have even one mortgage, automotive loan or lease, equipment loan or a even a line of credit with a local bank or credit union. These other forms of credit create a much more well rounded credit profile for the consumer. This is achieved by showing greater credit account diversity and experience with multiple types of credit due to the various lines held.
For example. A person with $50K in credit cards does not represent near the credit experience as a person with the same $50K along with a mortgage, an automotive loan and an equipment lease. We have clients who have financed vehicles not because they had to (or even wanted to) but because they “needed to” in order to create a credit profile that would position them in the future to secure the lowest possible rate on a mortgage when they applied and needed it.
More complex forms of Advance Credit Profiling involve one subscribing to affluent or semi-affluent business and professional publications and organizations. These would include magazines, newsletters, trade journals and national associations. The goal is to get ones name into the databases of these publications and organizations. Why? To get on highly targeted lists in order to receive select credit offers.
Marketers of credit offers have found that simply renting names of consumers from the credit bureaus does not provide enough information about the person as a credit risk anymore. Therefore, it is speculated that many will rent a list from the credit bureau and then cross-reference this list against another list they have secured from a consumer source such as an affluent business or professional publication, trade journal or organization.
By crossing the two lists together the marketers find the names contained on both lists. This in turn provides them with one highly refined and targeted list to mail their offer to. This results in shortening the process of securing a new quality account holder thus lower the overall account acquisition cost of new accounts.
When a consumer learns how to intentionally put themselves into these databases to wind up on these refined lists, the credit building process is sped up exponentially. Of course, many would call this “highly speculative” but we have undeniable experience that it works.
DEPOSIT LOAN PROGRAMS: This is a technique so unbelievable that I myself proclaimed it had to be a scam before researching the facts. It allows the consumer (or business) to have a $25,000 to $250,000 loan appear on their credit report as “Paid as Agreed” by way of very creative financing. This method is extremely effective and not within the budget of most ($750 to $7,500 upfront). Also, because this technique takes advantage of certain banking laws, I have reason to believe it could be made unavailable at any time if those banking laws were to change. This method can be used with consumer credit files on SSN’s as well as business and corporate credit files done on TIN’s as well as Dunn and Bradstreet.
In the end, all of us need to remember that today our credit score is more important than it has ever been in the history of the credit reporting system. While credit miracles don’t happen overnight, you can create your own credit miracles by applying simple insider strategies consistently over time. Before you know it, you’re a proud member of the 700 Club. The “700 Plus Credit Score” club that is!
www.Credit-Secrets-Bible.net
By: Jay Peters
About the Author:
Jay Peters is the founder of Consumer Publishing Group which publishes the Credit Secrets Bible (in print since 1994). To receive Free Credit Tips including “How to Bullet-Proof Yourself From Identity Theft For FREE!” visit their website: www.Credit-Secrets-Bible.net
Vikki Sowash