Archive for the ‘Finance’ Category
Annualcreditreport gives you a credit report free once a year, but they don’t give your credit score. I have been a lender for 7 years, and believe me when it comes to getting your loan done everyone looks at credit scores. Your credit score is a bench mark for banks to sell your loan on the secondary market. Typically investors use your middle credit score to determine your creditworthiness. Here is what myFICO® says in regards to how important it is to know your credit score.
How credit scoring helps you
Credit Score gives lenders a faster snapshot of your credit risk. Most lenders are now using FICO® to determine your score. Before the scoring process was implemented there was a biased opinion of your credit. Now there is less none bias opinion of your creditworthiness with credit score automation process with all 3 credit bureaus. When pulling your credit report with all 3 Credit Bureaus you typically get a score. Since annual does not provide this, you have to get your report through other service providers.
Here are some advantages of credit scores.
* You get loans faster Your credit scores can be delivered with a few key strokes with today’s technology. With the speedy process this helps lenders speed up the decisions making process. Even mortgage applications can be made within ours, instead of weeks.
* Credit Decisions are fairer Credit decisions can be made of facts instead of emotions. Factors like your gender, religion, race, marital status and nationality are not considered by credit scoring.
* More Credit is Available
Lenders can approve more loans because the credit scoring process gives them the information on which to base there decision on. It allows lenders to identity individuals that are likely to perform well in the future even though they have had issues in the past. Each lender has its own credit score guidelines, so if one denies you, you may get approved elsewhere. The use of credit scores gives lender the confidence to offer more credit to people since they better understand the risk they are taking.
* Credit mistakes count for less
If you have credit problems in the past, credit scoring does not let that haunt you forever. Past credit problems fad as time passes as long as new good credit patterns show up. Credit scoring weighs all credit in a file, as opposed to focusing primarily on past issues.
* Credit Rates are lower
The cost of loans decreases when more credit is available. The process of automation in the credit process is less because of the efficiency of the process, which is passed on to the consumer. Buy using the scoring process there are less defaults, and in returns saves the consumer in the long run. Credit Scores have revolutionized the lending arena, and has driven down cost for everyone.
Conclusion:
Now you know why you need to know your scores and how important it is. Recent studies show that 1 out of 4 credit reports have incorrect information on them. Plus identity theft is the fastest growing crime in America. You need to check your free credit report with scores every 90 days just to be safe in today’s times. Since your scores are the core in determining whether they will lend you money, shouldn’t you know what they are ? The answer to that is yes.
By: Mike Clover
About the Author:
How credit scoring helps you
Credit Score gives lenders a faster snapshot of your credit risk. Most lenders are now using FICO® to determine your score. Before the scoring process was implemented there was a biased opinion of your credit. Now there is less none bias opinion of your creditworthiness with credit score automation process with all 3 credit bureaus. When pulling your credit report with all 3 Credit Bureaus you typically get a score. Since annual does not provide this, you have to get your report through other service providers.
Here are some advantages of credit scores.
* You get loans faster Your credit scores can be delivered with a few key strokes with today’s technology. With the speedy process this helps lenders speed up the decisions making process. Even mortgage applications can be made within ours, instead of weeks.
* Credit Decisions are fairer Credit decisions can be made of facts instead of emotions. Factors like your gender, religion, race, marital status and nationality are not considered by credit scoring.
* More Credit is Available
Lenders can approve more loans because the credit scoring process gives them the information on which to base there decision on. It allows lenders to identity individuals that are likely to perform well in the future even though they have had issues in the past. Each lender has its own credit score guidelines, so if one denies you, you may get approved elsewhere. The use of credit scores gives lender the confidence to offer more credit to people since they better understand the risk they are taking.
* Credit mistakes count for less
If you have credit problems in the past, credit scoring does not let that haunt you forever. Past credit problems fad as time passes as long as new good credit patterns show up. Credit scoring weighs all credit in a file, as opposed to focusing primarily on past issues.
* Credit Rates are lower
The cost of loans decreases when more credit is available. The process of automation in the credit process is less because of the efficiency of the process, which is passed on to the consumer. Buy using the scoring process there are less defaults, and in returns saves the consumer in the long run. Credit Scores have revolutionized the lending arena, and has driven down cost for everyone.
Conclusion:
Now you know why you need to know your scores and how important it is. Recent studies show that 1 out of 4 credit reports have incorrect information on them. Plus identity theft is the fastest growing crime in America. You need to check your free credit report with scores every 90 days just to be safe in today’s times. Since your scores are the core in determining whether they will lend you money, shouldn’t you know what they are ? The answer to that is yes.
By: Mike Clover
About the Author:
About the Author: Mike Clover is the owner of http://www.creditscorequick.com/ . CreditScoreQuick.com is the one of the most unique on-line resources for free credit score report, fico score, Internet identity theft software, secure credit cards, and a BlOG with a wealth of personal credit information. The information within this website is written by professionals that know about credit, and what determines ones credit worthiness.
Erik Provent
The factors on your credit report that are used to determine your credit score are broken down into 5 categories, each with it’s own weight on the equation.
1. payment history (35%)
2. amounts owed (30%)
3. length of credit history (15%)
4. new credit (10%)
5. types of credit used (10%)
Payment History
One of the primary reasons that the credit scoring system was developed and why lenders still use it is to determine the likelihood that they will be repaid the money you borrow. Therefore, it makes sense that your payment history would be a mjor factor in your credit score. This aspect is affected negatively by late payments, accounts sent to collections, and bankruptcies. The more recently any of these have occured, the larger the effect on your score.
Amounts Owed
Outstanding debt is the next most important measure of your ability to pay back your obligations. Having credit cards, owning a home or car, or going to college means you probably have some debt on your record, which is okay. However, this part of your score can be affected by maxing out credit cards, or leaving them open with no activity. To quickly raise your credit score, pay off credit cards with the highest interest rate or where you have late payments first. It is good practice to keep credit cards at 25% of less of their balance.
Length of Credit History
The length of your credit history is based on the oldest account in your credit file. For many people this is their first credit card, a student loan, or possibly a car loan or mortgage. The shorter your credit history, the bigger the risk you represent to lenders. You should also be aware, however, that as your credit history gets longer and you have more accounts opening and closing, you are also at a greater risk for having misinformation added to your report.
New Credit
10 percent of the score is based on new credit. Typically your score will go down for awhile after you have opened up a new line of credit. The major factor of this percentage comes from inquiries. There are two types of inquiries; soft and hard. A soft inquiry does not affect the credit score and usually involves a quick glance at your score. A hard inquiry does lower your credit score and typically is a result of actions initiated by you in an effort to obtain credit. If you open 2 new credit card accounts, take out a private bank loan, and attempt to buy a new car, your score will go down…the good thing is that your score will rebound from these inquiries.
New Credit
Hard inquiries do affect your score, and lower it by a number of points for each inquiry. Hard inquiries are generally the result of you pursuing new credit opportunities. This is mostly a defense against you obtaining a good credit score and opening 100 new credit accounts all at once. After 10 inquires or so your score would be significantly lowered to the point where lenders would begin to reconsider your credit. The good news is that hard inquiries do not affect your credit for very long, and your score will return to normal after they expire.
Types of Credit Used
The final part of your score is based on the types of credit accounts you have. These include:
1. Revolving (credit cards, lines of credit, HELOC)
2. Loans
3. Public Records (bankruptcy, liens)
4. Collections
Some types of accounts can really help you score as long as you are paying them on time such as a student loan, car loan, mortgage, and credit cards. If you have ever had a public records such as a bankruptcy, tax lien, or a collection, your credit score is going to be negatively affected. Beware of companies that claim that they can remove a bankruptcy or a collection off your credit report. These items will eventually not be detrimental to your credit score so time often is the best answer for dealing with these actions in your credit history.
Some of the account types can contribute positively to your credit score as long as they are paid on time. For instance, student loans, home mortgages, or credit cards, if paid on time, can create very healthy credit. However, accounts like tax liens, collections, or bankruptcy will affect your credit negatively. If you have any of this second type of account on your record and you know it is inaccurate or fraudulent it is a good idea to contact a credit repair specialist to have it removed.
The bottom line in understanding your score is that lenders want to loan to people who know how use credit responsibly. After all, lenders only make money when people use credit, and when they pay it back. Therefore, if your credit history reflects that you make proper use of credit and pay back your obligations, your score will reflect this to lenders.
By: Ryan J Bell
About the Author:
1. payment history (35%)
2. amounts owed (30%)
3. length of credit history (15%)
4. new credit (10%)
5. types of credit used (10%)
Payment History
One of the primary reasons that the credit scoring system was developed and why lenders still use it is to determine the likelihood that they will be repaid the money you borrow. Therefore, it makes sense that your payment history would be a mjor factor in your credit score. This aspect is affected negatively by late payments, accounts sent to collections, and bankruptcies. The more recently any of these have occured, the larger the effect on your score.
Amounts Owed
Outstanding debt is the next most important measure of your ability to pay back your obligations. Having credit cards, owning a home or car, or going to college means you probably have some debt on your record, which is okay. However, this part of your score can be affected by maxing out credit cards, or leaving them open with no activity. To quickly raise your credit score, pay off credit cards with the highest interest rate or where you have late payments first. It is good practice to keep credit cards at 25% of less of their balance.
Length of Credit History
The length of your credit history is based on the oldest account in your credit file. For many people this is their first credit card, a student loan, or possibly a car loan or mortgage. The shorter your credit history, the bigger the risk you represent to lenders. You should also be aware, however, that as your credit history gets longer and you have more accounts opening and closing, you are also at a greater risk for having misinformation added to your report.
New Credit
10 percent of the score is based on new credit. Typically your score will go down for awhile after you have opened up a new line of credit. The major factor of this percentage comes from inquiries. There are two types of inquiries; soft and hard. A soft inquiry does not affect the credit score and usually involves a quick glance at your score. A hard inquiry does lower your credit score and typically is a result of actions initiated by you in an effort to obtain credit. If you open 2 new credit card accounts, take out a private bank loan, and attempt to buy a new car, your score will go down…the good thing is that your score will rebound from these inquiries.
New Credit
Hard inquiries do affect your score, and lower it by a number of points for each inquiry. Hard inquiries are generally the result of you pursuing new credit opportunities. This is mostly a defense against you obtaining a good credit score and opening 100 new credit accounts all at once. After 10 inquires or so your score would be significantly lowered to the point where lenders would begin to reconsider your credit. The good news is that hard inquiries do not affect your credit for very long, and your score will return to normal after they expire.
Types of Credit Used
The final part of your score is based on the types of credit accounts you have. These include:
1. Revolving (credit cards, lines of credit, HELOC)
2. Loans
3. Public Records (bankruptcy, liens)
4. Collections
Some types of accounts can really help you score as long as you are paying them on time such as a student loan, car loan, mortgage, and credit cards. If you have ever had a public records such as a bankruptcy, tax lien, or a collection, your credit score is going to be negatively affected. Beware of companies that claim that they can remove a bankruptcy or a collection off your credit report. These items will eventually not be detrimental to your credit score so time often is the best answer for dealing with these actions in your credit history.
Some of the account types can contribute positively to your credit score as long as they are paid on time. For instance, student loans, home mortgages, or credit cards, if paid on time, can create very healthy credit. However, accounts like tax liens, collections, or bankruptcy will affect your credit negatively. If you have any of this second type of account on your record and you know it is inaccurate or fraudulent it is a good idea to contact a credit repair specialist to have it removed.
The bottom line in understanding your score is that lenders want to loan to people who know how use credit responsibly. After all, lenders only make money when people use credit, and when they pay it back. Therefore, if your credit history reflects that you make proper use of credit and pay back your obligations, your score will reflect this to lenders.
By: Ryan J Bell
About the Author:
Veracity Credit Consultants, a leading provider of credit score repair has provided this article. Check them out online at http://www.VeracityCredit.com
Maynard Brignac
Are you hesitant to apply for a home loan just because you have a bad credit score? Good credit score is important but if you have bad credit it does not mean the end of the world. You can still get a home loan if you have a bad credit score.
You need to be very careful in your decision at the time of applying for the loan. Do not haste for the loan to the first offer you are presented. Many money lenders might try to rip you off just because of a bad credit history. Do not accept whatever they have to offer, look out for other options. There might be a better option waiting just next door.
A good search can help you fund lenders who are willing to provide you loan at a much lower interest rate.
Is credit score important?
Credit score is definitely important. No matter it is just a three digit number but it has great importance in today’s business world. Your credit score directly reflects your credit standings and your capacity to repay the loan. A Bad credit score does’nt makes it impossible to get the home loan but it will certainly affect the interest rate you’ll have to pay.
One of the best ways to improve your credit score before applying for the loan is to do credit score repair. All you have to is get a copy of your credit score from any credit agencies. In fact you need to check your credit score once in six months. The reason for this repair is that there might be certain errors in your credit report. Its quite possible you might have paid your dues but they are not recorded in the credit report. You have to notice all these errors and inform the credit agencies to do the necessary corrections. Remember a credit score repair can help you improve your credit score by quite a margin.
Bad credit score is definitely not the end of the world. Your home loan can still be approved. The only drawback is the high interest rate which could have been way low if you had a good credit score. Improve your credit score with the help of following tips
• Pay your dues on time
• Check your credit score at least once in six months
• Avoid creating multiple accounts. Close all unnecessary accounts. Remember zero balance accounts are also taken into consideration.
Isabella Rodrigues writes for credit-free-score.net,
offering the latest information on credit score, visit them today for more infromation
on credit score..
Visit today: http://www.credit-free-score.net
By: Isabel
About the Author:
You need to be very careful in your decision at the time of applying for the loan. Do not haste for the loan to the first offer you are presented. Many money lenders might try to rip you off just because of a bad credit history. Do not accept whatever they have to offer, look out for other options. There might be a better option waiting just next door.
A good search can help you fund lenders who are willing to provide you loan at a much lower interest rate.
Is credit score important?
Credit score is definitely important. No matter it is just a three digit number but it has great importance in today’s business world. Your credit score directly reflects your credit standings and your capacity to repay the loan. A Bad credit score does’nt makes it impossible to get the home loan but it will certainly affect the interest rate you’ll have to pay.
One of the best ways to improve your credit score before applying for the loan is to do credit score repair. All you have to is get a copy of your credit score from any credit agencies. In fact you need to check your credit score once in six months. The reason for this repair is that there might be certain errors in your credit report. Its quite possible you might have paid your dues but they are not recorded in the credit report. You have to notice all these errors and inform the credit agencies to do the necessary corrections. Remember a credit score repair can help you improve your credit score by quite a margin.
Bad credit score is definitely not the end of the world. Your home loan can still be approved. The only drawback is the high interest rate which could have been way low if you had a good credit score. Improve your credit score with the help of following tips
• Pay your dues on time
• Check your credit score at least once in six months
• Avoid creating multiple accounts. Close all unnecessary accounts. Remember zero balance accounts are also taken into consideration.
Isabella Rodrigues writes for credit-free-score.net,
offering the latest information on credit score, visit them today for more infromation
on credit score..
Visit today: http://www.credit-free-score.net
By: Isabel
About the Author:
Isabella Rodrigues writes for credit-free-score.net,
offering the latest information on credit score, visit them today for more infromation
on credit score..
Visit today: http://www.credit-free-score.net
Brendon Lascody
Credit scores are the equivalent of a financial report card. There is no way to avoid having credit scores since the Big Three consumer reporting agencies – Equifax, Trans Union, and Experian – keep tabs on your credit situation daily. These agencies then report your scores to any lender who requests it.
A credit score is also called a FICO score. If you have a low credit scores you could be turned down for home or auto loans. Your low score can also actually contribute toward your financial woes since it usually means higher monthly payments on any money you borrow.
There is hope, however! By taking the right steps, you can improve your credit scores significantly. Here are 7 tips for improving your credit scores.
Tip #1: Check your latest credit reports from each of the Big Three bureaus:
The first step toward better credit scores is to find out your current score from each of the Big Three consumer reporting bureaus. You can find a number of Web sites that give you access to this information for FREE. To find one, run a search in your favorite search engine using the keywords free credit report.
Tip #2: Immediately correct any blatant mistakes:
Download and review each report item by item, circling any blatant errors you find. Of particular importance are inaccurate unpaid balance flags, the existence of credit accounts that you never opened, and incorrect information concerning your current address. You must take each of these mistakes quite seriously and address them to both the relevant credit agency and, when applicable, the lender in question.
Tip #3: Pay your bills on time:
This is a common sense item, but people having credit problems often neglect it due to the snowballing nature of their debt situation. Paying your bills on time is very important, and nowadays even utility companies are reporting your payment history to the credit agencies. Hint: to improve your score even more, make your monthly credit card payments before the end of the statement period. This has the positive effect of keeping any charges made that month from even showing up as a balance on your cards, thereby improving your ongoing debt-to-credit limit ratio (see Tip#4).
Tip #4: Improve your debt-to-credit limit ratio:
In calculating your credit worthiness, the Big Three credit agencies factor in heavily your debt-to-credit limit ratio. As the term implies, this ratio is simply the result of dividing your total current credit card debt by the total credit limit across all of your cards. The ratio is always a number between 0 and 1, with numbers below 0.5 being most favorable. There are two ways to reduce your debt-to-credit limit ratio. One way is to simply reduce your credit card balances by paying them down. Another option that many people fail to consider: request an increase in credit limit from your creditors.
Tip #5: Pay off debt, don’t just move it around:
While it can be a smart move to transfer debt from your higher interest credit cards to your lower interest cards, this does not substitute for actually paying down your overall debt. Just moving your debt from card to card is not going to improve your score.
Tip #6: Avoid closing credit cards just prior to a loan application:
Some people believe that closing out some of their credit cards immediately prior to applying for a loan is a good idea. However, this is not true. On the contrary, it has the effect of suddenly increasing your debt-to-credit limit ratio, which is a credit score no-no. In fact, as long as you have the will power to use your credit cards wisely, it can be a good idea to keep multiple cards. Then, use these additional cards from time to time, charging small amounts and then quickly paying them off. This reflects positively in your credit scores as your having a healthy ability to manage your debt.
Tip #7: Understand the influence that bankruptcy has on your score:
As a final note, beware that having declared bankruptcy in the past can make it especially hard to achieve better credit scores. Bankruptcies can stay on your credit report for 7 to 10 years.
By: Jed Jones
About the Author:
A credit score is also called a FICO score. If you have a low credit scores you could be turned down for home or auto loans. Your low score can also actually contribute toward your financial woes since it usually means higher monthly payments on any money you borrow.
There is hope, however! By taking the right steps, you can improve your credit scores significantly. Here are 7 tips for improving your credit scores.
Tip #1: Check your latest credit reports from each of the Big Three bureaus:
The first step toward better credit scores is to find out your current score from each of the Big Three consumer reporting bureaus. You can find a number of Web sites that give you access to this information for FREE. To find one, run a search in your favorite search engine using the keywords free credit report.
Tip #2: Immediately correct any blatant mistakes:
Download and review each report item by item, circling any blatant errors you find. Of particular importance are inaccurate unpaid balance flags, the existence of credit accounts that you never opened, and incorrect information concerning your current address. You must take each of these mistakes quite seriously and address them to both the relevant credit agency and, when applicable, the lender in question.
Tip #3: Pay your bills on time:
This is a common sense item, but people having credit problems often neglect it due to the snowballing nature of their debt situation. Paying your bills on time is very important, and nowadays even utility companies are reporting your payment history to the credit agencies. Hint: to improve your score even more, make your monthly credit card payments before the end of the statement period. This has the positive effect of keeping any charges made that month from even showing up as a balance on your cards, thereby improving your ongoing debt-to-credit limit ratio (see Tip#4).
Tip #4: Improve your debt-to-credit limit ratio:
In calculating your credit worthiness, the Big Three credit agencies factor in heavily your debt-to-credit limit ratio. As the term implies, this ratio is simply the result of dividing your total current credit card debt by the total credit limit across all of your cards. The ratio is always a number between 0 and 1, with numbers below 0.5 being most favorable. There are two ways to reduce your debt-to-credit limit ratio. One way is to simply reduce your credit card balances by paying them down. Another option that many people fail to consider: request an increase in credit limit from your creditors.
Tip #5: Pay off debt, don’t just move it around:
While it can be a smart move to transfer debt from your higher interest credit cards to your lower interest cards, this does not substitute for actually paying down your overall debt. Just moving your debt from card to card is not going to improve your score.
Tip #6: Avoid closing credit cards just prior to a loan application:
Some people believe that closing out some of their credit cards immediately prior to applying for a loan is a good idea. However, this is not true. On the contrary, it has the effect of suddenly increasing your debt-to-credit limit ratio, which is a credit score no-no. In fact, as long as you have the will power to use your credit cards wisely, it can be a good idea to keep multiple cards. Then, use these additional cards from time to time, charging small amounts and then quickly paying them off. This reflects positively in your credit scores as your having a healthy ability to manage your debt.
Tip #7: Understand the influence that bankruptcy has on your score:
As a final note, beware that having declared bankruptcy in the past can make it especially hard to achieve better credit scores. Bankruptcies can stay on your credit report for 7 to 10 years.
By: Jed Jones
About the Author:
A 50-point improvement in your FICO score could save you $1,000s in annual debt payments. Improve your score by up to 249 points in 90 days with the Credit Secrets Bible: www.Success-Junky.com
Ismael Schmeichel
You need to know how credit scoring and your credit report works to get out of debt and improve your financial future. Here is what you need to know.
You may be wondering how some people can walk into a lending institution and get credit, or loans, while others that have the same income or job seem to get turned down or receive a higher interest rate. It is all about the risk factor and whether you are a safe risk, or a bad one, when you are being loaned money.
Creditors use a credit scoring system that gives them an idea of whether the person who wants to borrow money is likely to make their repayments, whether they have a history of not making repayments, or are likely to be unable to make the monthly repayments.
These credit scoring systems may go under several names. One of the most widely known credit scoring software applications is the FICO, or the Fair Isaac Corporation, and there are three variations of this software used by the three major credit reporting agencies.
What Exactly Is Credit Scoring?
Credit scoring is collected information about you and your credit history. Contained in a credit report is your bill paying history, as well as how many accounts that you already hold and what type they are. Things such as late payments, any collection actions taken against you, outstanding debts and how long you have had accounts are all considered. All of this information is compared with other consumers that fit the same profile as you to determine the type of risk that you are to the creditor.
The credit scoring system gives you points for each factor and the end result tells the creditor if you are likely to repay your debts. The total amount of your debt is then added up to give you a credit score. Your credit score is an indication on how likely you are to repay your debts and make your monthly repayments when they are due.
Find Out What What’s In Your Credit Report First – since you now know that everything in your credit report is vital to whether you are going to get the line of credit that you are applying for, it would make sense to get your credit report and take a look at what is in it.
Sometimes credit reporting agencies can make mistakes or place something on your report that is inaccurate. By checking your credit records for yourself, you can make sure that everything contained in it is true and accurate.
Before applying for anything, make sure that you obtain your credit report. An amendment in the federal fair credit reporting act now allows a consumer the opportunity to receive a free credit report when you request it, or at least each year.
You obtain your financial summary making a request to one or all of the major credit reporting agencies.
Read through your report and make sure that everything is accurate and you are happy with what has been included in the document. By reading through your report, you will also be able to see if there are good things or bad things listed on your report. This will have a bearing on whether you are likely to be given credit.
Why Credit Scoring Is Used, And Is It Fair?
Credit scoring is based on real information and statistics rather than the personal judgments of another person. Because of this, there is no variation in acceptance of a loan based on other things that are not statistically based facts. Different creditors often use different types of scoring models from agency to agency. Also, different models of the system are used for different lines of credit.
Under the equal credit opportunity act, no scoring systems are allowed to use race, sex, religion, marital status or a person’s country of origin to determine an individuals creditworthiness. Age is sometimes allowed as a scoring characteristic as long as the system is designed properly and those that are over a certain age are treated fairly and given the same opportunities as younger applicants.
If you are not given credit, or your application is denied, the creditor must provide you with the reasons why your application was rejected, either by notification, or by you asking the creditor within two months of being denied. A creditor must also give you a fair reason by law. The credit report system has been designed to make sure that creditors are as fair and objective as possible with those who are applying for financial assistance.
How To Improve Your Credit Score – credit score criterion can differ between creditors, but there are a few fundamentals that can be used to make sure that your credit is in good shape. These include things like:
-Paying your bills on time: Because your history is always taken into account when a credit score is determined, you can improve chances of acceptance by making sure that you have good statistics on paying bills and previous repayments.
-Evaluate your debts: Calculate your outstanding debts and compare them to your existing credit limits. If you are almost at capacity, consider reducing some of your debt before applying for more credit.
-What is your credit history: How long you have had a credit history is also important. If you haven’t had one for long, it can still work in your favor by having all of your payments made on time and low balances on your already existing credit.
-Have you made a lot of inquiries lately? This can have an effect on how your score is determined. Try to avoid applying for too many accounts, or lines of credit in a short time.
The best way to keep a good credit score, or start repairing your records, is to pay your bills on time and try to reduce some of the debt that you already have.
If you have damaged your credit score, it will take some time and perseverance, but, you will be able to repair your credit score as they are updated and subject to change over time with new information that is contained in your credit reports.
By: Ken Black
About the Author:
You may be wondering how some people can walk into a lending institution and get credit, or loans, while others that have the same income or job seem to get turned down or receive a higher interest rate. It is all about the risk factor and whether you are a safe risk, or a bad one, when you are being loaned money.
Creditors use a credit scoring system that gives them an idea of whether the person who wants to borrow money is likely to make their repayments, whether they have a history of not making repayments, or are likely to be unable to make the monthly repayments.
These credit scoring systems may go under several names. One of the most widely known credit scoring software applications is the FICO, or the Fair Isaac Corporation, and there are three variations of this software used by the three major credit reporting agencies.
What Exactly Is Credit Scoring?
Credit scoring is collected information about you and your credit history. Contained in a credit report is your bill paying history, as well as how many accounts that you already hold and what type they are. Things such as late payments, any collection actions taken against you, outstanding debts and how long you have had accounts are all considered. All of this information is compared with other consumers that fit the same profile as you to determine the type of risk that you are to the creditor.
The credit scoring system gives you points for each factor and the end result tells the creditor if you are likely to repay your debts. The total amount of your debt is then added up to give you a credit score. Your credit score is an indication on how likely you are to repay your debts and make your monthly repayments when they are due.
Find Out What What’s In Your Credit Report First – since you now know that everything in your credit report is vital to whether you are going to get the line of credit that you are applying for, it would make sense to get your credit report and take a look at what is in it.
Sometimes credit reporting agencies can make mistakes or place something on your report that is inaccurate. By checking your credit records for yourself, you can make sure that everything contained in it is true and accurate.
Before applying for anything, make sure that you obtain your credit report. An amendment in the federal fair credit reporting act now allows a consumer the opportunity to receive a free credit report when you request it, or at least each year.
You obtain your financial summary making a request to one or all of the major credit reporting agencies.
Read through your report and make sure that everything is accurate and you are happy with what has been included in the document. By reading through your report, you will also be able to see if there are good things or bad things listed on your report. This will have a bearing on whether you are likely to be given credit.
Why Credit Scoring Is Used, And Is It Fair?
Credit scoring is based on real information and statistics rather than the personal judgments of another person. Because of this, there is no variation in acceptance of a loan based on other things that are not statistically based facts. Different creditors often use different types of scoring models from agency to agency. Also, different models of the system are used for different lines of credit.
Under the equal credit opportunity act, no scoring systems are allowed to use race, sex, religion, marital status or a person’s country of origin to determine an individuals creditworthiness. Age is sometimes allowed as a scoring characteristic as long as the system is designed properly and those that are over a certain age are treated fairly and given the same opportunities as younger applicants.
If you are not given credit, or your application is denied, the creditor must provide you with the reasons why your application was rejected, either by notification, or by you asking the creditor within two months of being denied. A creditor must also give you a fair reason by law. The credit report system has been designed to make sure that creditors are as fair and objective as possible with those who are applying for financial assistance.
How To Improve Your Credit Score – credit score criterion can differ between creditors, but there are a few fundamentals that can be used to make sure that your credit is in good shape. These include things like:
-Paying your bills on time: Because your history is always taken into account when a credit score is determined, you can improve chances of acceptance by making sure that you have good statistics on paying bills and previous repayments.
-Evaluate your debts: Calculate your outstanding debts and compare them to your existing credit limits. If you are almost at capacity, consider reducing some of your debt before applying for more credit.
-What is your credit history: How long you have had a credit history is also important. If you haven’t had one for long, it can still work in your favor by having all of your payments made on time and low balances on your already existing credit.
-Have you made a lot of inquiries lately? This can have an effect on how your score is determined. Try to avoid applying for too many accounts, or lines of credit in a short time.
The best way to keep a good credit score, or start repairing your records, is to pay your bills on time and try to reduce some of the debt that you already have.
If you have damaged your credit score, it will take some time and perseverance, but, you will be able to repair your credit score as they are updated and subject to change over time with new information that is contained in your credit reports.
By: Ken Black
About the Author:
Ken Black is the owner of Debt Relief Today, a website all about your FICO Score and much more.
Darcey Guisti
Most of us know what our credit score it. Let’s face it, how could you not know? But so what? what does that number mean? Many American’s have asked “is 700 a good credit score?” Well, it’s time to find out.
One reason many ask “is 700 a good credit score?” is because only one-third of all American’s can give an informed answer. The first reaction is “Hey it’s better than 600,” but how hard is that anyway?! Take the time, right now, to finally annalyze what a credit score means.
When it comes to dissecting and analyzing a credit score there are a few standard rules and a few that are quite subjective. Is 700 a good credit score? I don’t know, is it? See, it all depends on who you ask. A national bank may draw the line for the lowest mortgage rates at 740, where a hometown bank may decide that when asked “is 700 a good credit score?” to answer, “why yes!.”
Credit scores are notorious for being the measuring stick for many important life events that you will face. Trying to rent your first place? Most likely a credit score of 700 will be more than sufficient to get the “A-OK” for the first available apartment. It truly is amazing how many things a person’s credit score is pulled for.
Employers love to pull applicant’s credit. The fact that there is a definite number attached to one’s credit gives the impression that one’s credit is an object measure of a person’s trustworthiness and responsibility. Really? Well, o.k., I’ll succeed a bit. Granted, a score of 400 did not get that way by one late credit card payment. But if you’re flashing a 700, then yes to the questions “is 700 a good credit score.” 700 is a score to hold your head high and be proud about. However, attaining even a respectable 700 will not get you all the perks available.
Let’s assume you’re past the “getting my first apartment” and I’m stealing mom and dad’s dishes phase. Let’s push it a bit further and even assume that you’ve lived a bit of life and are looking to build your financial portfolio. Have an interest in real estate? Fantastic! Real estate offers a bevvy of wealth opportunity. Time to go back to our original question “is 700 a good credit score?” Yes and no.
When one begins to expand their financial power, the higher the credit score the better, period. There are specific home investing loans that you will need to have a credit score of 740 or better to take advantage of. Some lenders will require 780 for the most liberal of loans. Can’t say that I blame them. We’re talking about hundreds of thousands of dollars with minimal proof required and a low interest rate!
Let’s all agree at this point to answer “is 700 a good credit score?” with a wholehearted “Yes!”?” I never said you couldn’t do better.
By: Ann Born
About the Author:
One reason many ask “is 700 a good credit score?” is because only one-third of all American’s can give an informed answer. The first reaction is “Hey it’s better than 600,” but how hard is that anyway?! Take the time, right now, to finally annalyze what a credit score means.
When it comes to dissecting and analyzing a credit score there are a few standard rules and a few that are quite subjective. Is 700 a good credit score? I don’t know, is it? See, it all depends on who you ask. A national bank may draw the line for the lowest mortgage rates at 740, where a hometown bank may decide that when asked “is 700 a good credit score?” to answer, “why yes!.”
Credit scores are notorious for being the measuring stick for many important life events that you will face. Trying to rent your first place? Most likely a credit score of 700 will be more than sufficient to get the “A-OK” for the first available apartment. It truly is amazing how many things a person’s credit score is pulled for.
Employers love to pull applicant’s credit. The fact that there is a definite number attached to one’s credit gives the impression that one’s credit is an object measure of a person’s trustworthiness and responsibility. Really? Well, o.k., I’ll succeed a bit. Granted, a score of 400 did not get that way by one late credit card payment. But if you’re flashing a 700, then yes to the questions “is 700 a good credit score.” 700 is a score to hold your head high and be proud about. However, attaining even a respectable 700 will not get you all the perks available.
Let’s assume you’re past the “getting my first apartment” and I’m stealing mom and dad’s dishes phase. Let’s push it a bit further and even assume that you’ve lived a bit of life and are looking to build your financial portfolio. Have an interest in real estate? Fantastic! Real estate offers a bevvy of wealth opportunity. Time to go back to our original question “is 700 a good credit score?” Yes and no.
When one begins to expand their financial power, the higher the credit score the better, period. There are specific home investing loans that you will need to have a credit score of 740 or better to take advantage of. Some lenders will require 780 for the most liberal of loans. Can’t say that I blame them. We’re talking about hundreds of thousands of dollars with minimal proof required and a low interest rate!
Let’s all agree at this point to answer “is 700 a good credit score?” with a wholehearted “Yes!”?” I never said you couldn’t do better.
By: Ann Born
About the Author:
Writer, researcher and website designer Ann Born has managed websites for over 3 years and has written 100′s of articles. More information regarding is 700 a good credit score can be found at http://www.officialcreditrepairtips.com.This article may not be reproduced in any way without including the Author’s Bio.
Hank Lombard
Credit Score being the doorway to financial health I thought I would give some tips on what to avoid so your credit score is not affected. If your credit score is currently low I guarantee that you are paying too much to your creditors. Any business that is in business for profit is looking for a reason to make money. If a creditor knows your credit scores are low they will charge you for it. The reason is because they can. Here is what to avoid so your creditworthiness is not affected.
Late Payments
This is one credit dink I see all the time. If you are late on a obligation that reports to the credit bureaus I assure you that your score will drop around 75 to 100 points. Timely payments account for 35% of your overall FICO score. This particular factor in your credit score is the biggest factor of all.
Amounted Owed
If you have credit card debt, and the balanced owed vs. the allowed credit limit is more than 30%, your score is affected. The amount owed accounts for 30% of your overall FICO score. You should keep your credit debt well below 30% of the allowed credit limit.
Length of Credit History
Once you are granted some credit the FICO score model looks at how long you have been in good standing with your credit. If you have a good history with your creditors, you can count on it helping your overall credit health. The length of your credit history accounts for 15% of your score.
Mix of Credit
Mix of credit accounts for 10% of your FICO score according to Fair Isaac. So you need credit cards, installment loans, auto loans, department store credit, etc…… The rule of thumb is to have at least 3 to 4 lines of different types of credit to get the best overall score.
New Credit
New credit accounts for 10% of your FICO score. The FICO score model does not like to see you applying for too much credit. Too many hard credit inquiries will affect your credit score. The rule of thumb is around 3 to 4 different types of credit.
Identity Theft & Credit Monitoring
Make sure you are pulling a copy of your free credit report regularly. With the identity theft problem it is recommended to set up some type of credit monitoring with immediate alerts. So if something happens you will know about it quickly.
Co-Signing
Co-signing is a big problem as well. We don’t recommend co-signing for anyone. If a family member or friend does not have the credit to buy, the best thing they can do to get credit established is to get a couple of secured credit cards. This is the fastest way to improved credit health. With a little history, usually 12 months of good payment history the creditors will open the doors of credit.
By: Mike Clover
About the Author:
Late Payments
This is one credit dink I see all the time. If you are late on a obligation that reports to the credit bureaus I assure you that your score will drop around 75 to 100 points. Timely payments account for 35% of your overall FICO score. This particular factor in your credit score is the biggest factor of all.
Amounted Owed
If you have credit card debt, and the balanced owed vs. the allowed credit limit is more than 30%, your score is affected. The amount owed accounts for 30% of your overall FICO score. You should keep your credit debt well below 30% of the allowed credit limit.
Length of Credit History
Once you are granted some credit the FICO score model looks at how long you have been in good standing with your credit. If you have a good history with your creditors, you can count on it helping your overall credit health. The length of your credit history accounts for 15% of your score.
Mix of Credit
Mix of credit accounts for 10% of your FICO score according to Fair Isaac. So you need credit cards, installment loans, auto loans, department store credit, etc…… The rule of thumb is to have at least 3 to 4 lines of different types of credit to get the best overall score.
New Credit
New credit accounts for 10% of your FICO score. The FICO score model does not like to see you applying for too much credit. Too many hard credit inquiries will affect your credit score. The rule of thumb is around 3 to 4 different types of credit.
Identity Theft & Credit Monitoring
Make sure you are pulling a copy of your free credit report regularly. With the identity theft problem it is recommended to set up some type of credit monitoring with immediate alerts. So if something happens you will know about it quickly.
Co-Signing
Co-signing is a big problem as well. We don’t recommend co-signing for anyone. If a family member or friend does not have the credit to buy, the best thing they can do to get credit established is to get a couple of secured credit cards. This is the fastest way to improved credit health. With a little history, usually 12 months of good payment history the creditors will open the doors of credit.
By: Mike Clover
About the Author:
About the Author: Mike Clover is the owner of http://www.creditscorequick.com/ . CreditScoreQuick.com is the one of the most unique on-line resources for free credit score report, fico score, Internet identity theft software, secure credit cards, and a BlOG with a wealth of personal credit information. The information within this website is written by professionals that know about credit, and what determines ones credit worthiness.
Elvis Knightly
When you apply for credit, whether for a mortgage, an auto loan, or a credit card, your credit score will determine whether or not you can secure financing, and what type of interest rate you can get. While you probably have at least some idea of how good or bad your credit is, it is important to understand your credit score and how it is calculated.
A credit score is a three digit number that ranges from 300 to 850. Each of the three major credit bureaus use this rating system that was devised by the Fair Isaac corporation – commonly called a FICO score. Your FICO score is calculated by measuring three distinct aspects of your credit.
1.A third of the score is based on your payment history. If you have defaulted on one or more loans, or been more than thirty days late making payments on your credit accounts, your credit score will be adversely affected.
2.The next portion of your credit score is determined by your credit to debt ratio. If you have a number of credit accounts close to being maxed out, or if your total debt is too great, this part of your score will suffer. Conversely, if you keep your credit balances reasonably low, your score will be higher.
3.The final part of your credit score takes three separate factors into account: the length of your credit history, the amount of credit for which you have recently applied , and the type of debt you have. Of the three, the length of your credit history holds the most weight. If you have established a long history of repaying your debts on time, you will be looked upon as less of a credit risk. Another aspect of your credit score is the number of recent applications you have. The greater the number, the lower the score. Finally, the types of credit you carry will affect your credit score. A credit card from a bank would have a more positive effect on your score than would a store credit card. Applying for credit with a finance company could label you a higher credit risk, and may be seen as a last resort for someone who could not get a bank card.
Once your score has been determined and made available to prospective lenders, it is often the only factor considered in determining your eligibility for credit and the interest rate you will receive. A higher FICO score will translate into savings when you apply for credit. A lower score may increase your interest rate which may cause you to have to borrow more money than you would have otherwise.
Also, information provided by credit reporting companies is not always accurate. You should acquire a copy of your credit report for inconsistencies and inaccurate items. If you find any questionable items on your credit report, you have the right to dispute them and possibly have them removed.
Once you understand the effect that debt and use of credit has on your credit score, you can devise a plan to make any necessary repairs to your credit. As your credit score improves, you will pay less when you borrow money, and you will find more and more lenders eager to do business with you.
By: Gregg Pennington
About the Author:
A credit score is a three digit number that ranges from 300 to 850. Each of the three major credit bureaus use this rating system that was devised by the Fair Isaac corporation – commonly called a FICO score. Your FICO score is calculated by measuring three distinct aspects of your credit.
1.A third of the score is based on your payment history. If you have defaulted on one or more loans, or been more than thirty days late making payments on your credit accounts, your credit score will be adversely affected.
2.The next portion of your credit score is determined by your credit to debt ratio. If you have a number of credit accounts close to being maxed out, or if your total debt is too great, this part of your score will suffer. Conversely, if you keep your credit balances reasonably low, your score will be higher.
3.The final part of your credit score takes three separate factors into account: the length of your credit history, the amount of credit for which you have recently applied , and the type of debt you have. Of the three, the length of your credit history holds the most weight. If you have established a long history of repaying your debts on time, you will be looked upon as less of a credit risk. Another aspect of your credit score is the number of recent applications you have. The greater the number, the lower the score. Finally, the types of credit you carry will affect your credit score. A credit card from a bank would have a more positive effect on your score than would a store credit card. Applying for credit with a finance company could label you a higher credit risk, and may be seen as a last resort for someone who could not get a bank card.
Once your score has been determined and made available to prospective lenders, it is often the only factor considered in determining your eligibility for credit and the interest rate you will receive. A higher FICO score will translate into savings when you apply for credit. A lower score may increase your interest rate which may cause you to have to borrow more money than you would have otherwise.
Also, information provided by credit reporting companies is not always accurate. You should acquire a copy of your credit report for inconsistencies and inaccurate items. If you find any questionable items on your credit report, you have the right to dispute them and possibly have them removed.
Once you understand the effect that debt and use of credit has on your credit score, you can devise a plan to make any necessary repairs to your credit. As your credit score improves, you will pay less when you borrow money, and you will find more and more lenders eager to do business with you.
By: Gregg Pennington
About the Author:
Gregg Pennington writes articles on a number of topics including loans, debt and credit. For more information about debt help and credit repair visit: http://www.onlinemoneysources.net/debt-and-credit.html
Elvis Knightly
he words “credit score” into any major search engine and you will quickly realize that knowing your credit score – and improving it – is big business. There are a number of companies out there that specialize in teaching individuals about the importance of their credit score.
In truth, your credit score holds a much larger influence on your life than you may realize. Credit scores are hard to escape and will be with you throughout your life. This will influence the interest rates you pay on purchases through to approval for major loans such as a home loan. Once you realize how important your credit score can be for your financial portfolio and lifestyle, it’s integral that you take steps to understand and improve it as much as possible.
Your credit score is your financial report card. Whether is good or bad, any financial document under yoiur name is going to impact your credit score. Conversely, if you are just starting out and have few financial documents with your name associated with them, you might have a lower credit score simply because you do not yet have a strong credit history.
Credit cards can be either your best friend or worse enemy with your credit score. If you are young or just starting out independently, it is often recommended that you secure a credit card to begin your credit history. By establishing a low-interest, low limit credit card, you can start to build a strong credit history by paying off your bills each month. In addition, putting your name on the utilities or establishing a good record of payment with your rent or mortgage can also increase your credit score. When you apply for a credit card in the future or wish to lower the interest rate on your current credit card, your credit company will first look to your credit score and payment history. If both of you have a good credit score then you are likely to benefit from a lower interest rate.
However, if you have been behind on payments or have excessive debt on the credit card, you might be turned down due to a lower credit score. It’s important to understand that using a credit card wisely can help you, but taking advantage of the credit card debt will destroy your credit score in the long run, affecting numerous future financial purchases.
When you go to buy a home, for example, the bank providing the home loan will consider your credit score before approving your loan or giving you a lower interest rate. In addition, if you plan to purchase a new car in the future, the car loan amount will also depend on your credit score.
Take charge of your financial future by analyzing and understanding your credit score and how much it can change your life.
By: Richard Greenwood
About the Author:
In truth, your credit score holds a much larger influence on your life than you may realize. Credit scores are hard to escape and will be with you throughout your life. This will influence the interest rates you pay on purchases through to approval for major loans such as a home loan. Once you realize how important your credit score can be for your financial portfolio and lifestyle, it’s integral that you take steps to understand and improve it as much as possible.
Your credit score is your financial report card. Whether is good or bad, any financial document under yoiur name is going to impact your credit score. Conversely, if you are just starting out and have few financial documents with your name associated with them, you might have a lower credit score simply because you do not yet have a strong credit history.
Credit cards can be either your best friend or worse enemy with your credit score. If you are young or just starting out independently, it is often recommended that you secure a credit card to begin your credit history. By establishing a low-interest, low limit credit card, you can start to build a strong credit history by paying off your bills each month. In addition, putting your name on the utilities or establishing a good record of payment with your rent or mortgage can also increase your credit score. When you apply for a credit card in the future or wish to lower the interest rate on your current credit card, your credit company will first look to your credit score and payment history. If both of you have a good credit score then you are likely to benefit from a lower interest rate.
However, if you have been behind on payments or have excessive debt on the credit card, you might be turned down due to a lower credit score. It’s important to understand that using a credit card wisely can help you, but taking advantage of the credit card debt will destroy your credit score in the long run, affecting numerous future financial purchases.
When you go to buy a home, for example, the bank providing the home loan will consider your credit score before approving your loan or giving you a lower interest rate. In addition, if you plan to purchase a new car in the future, the car loan amount will also depend on your credit score.
Take charge of your financial future by analyzing and understanding your credit score and how much it can change your life.
By: Richard Greenwood
About the Author:
Richard Greenwood – Director of Online banking magazine The Money Web. The free online magazine features articles from a wide range of finance insiders to provide excellent tips.
Larry Purfeerst
Before you pay your bills this month, learn more about what actions will harm your credit score. Your credit score is used by the credit bureaus as a measure of your credit worthiness. The national average credit score is 692, according to Experian Information Solutions, Inc. Credit scores fluctuate by credit bureau, but they are usually in the same range and the national average can serve as a good benchmark. Lenders, credit card companies and other entities use your credit score as a major factor in determining your credit worthiness. So, what actions will harm your credit score?
What Makes Up a Credit Score
A number of factors go into a credit score. The exact formula used by any company is proprietary, but credit scores are usually broken up into several categories. 35 percent of your credit score covers your payment history. 30 percent is based upon the amount you owe. 15 percent of your credit score is related to the length of time that you have had a credit history. 10 percent of your credit score is tied into the types of credit that you have. The final 10 percent of your credit score reflects your new lines of credit.
Late Payments Do the Most Damage to Your Credit Score
Based on the factors that make up a credit score, it’s easy to understand that certain actions will be harmful to your credit history. While most of your credit history is made up of lines of credit and loans, energy companies and wireless phone companies are also starting to report to the credit bureaus. Making late payments has the biggest impact on your credit score. In addition to making late payments, the number of days’ delinquency also impacts your credit history. A payment that is 30 days late is weighted less heavily than a payment that is several months late and ends up in collections.
Other Factors that Will Harm Your Credit Score
Owing too much on any account, and the total amount of credit you have vs. the amount you owe will also harm your credit. The length of time that you have had any credit at all, the number of new lines of credit and credit inquiries will also impact your credit score. The credit bureaus like to see a mix of account types to include installment loans, different types of credit cards and other accounts, like mortgages.
You can order your credit report and credit score online to see where you stand based on the national average credit score.
By: Lisa Nichols
About the Author:
What Makes Up a Credit Score
A number of factors go into a credit score. The exact formula used by any company is proprietary, but credit scores are usually broken up into several categories. 35 percent of your credit score covers your payment history. 30 percent is based upon the amount you owe. 15 percent of your credit score is related to the length of time that you have had a credit history. 10 percent of your credit score is tied into the types of credit that you have. The final 10 percent of your credit score reflects your new lines of credit.
Late Payments Do the Most Damage to Your Credit Score
Based on the factors that make up a credit score, it’s easy to understand that certain actions will be harmful to your credit history. While most of your credit history is made up of lines of credit and loans, energy companies and wireless phone companies are also starting to report to the credit bureaus. Making late payments has the biggest impact on your credit score. In addition to making late payments, the number of days’ delinquency also impacts your credit history. A payment that is 30 days late is weighted less heavily than a payment that is several months late and ends up in collections.
Other Factors that Will Harm Your Credit Score
Owing too much on any account, and the total amount of credit you have vs. the amount you owe will also harm your credit. The length of time that you have had any credit at all, the number of new lines of credit and credit inquiries will also impact your credit score. The credit bureaus like to see a mix of account types to include installment loans, different types of credit cards and other accounts, like mortgages.
You can order your credit report and credit score online to see where you stand based on the national average credit score.
By: Lisa Nichols
About the Author:
Lisa Nichols is a freelance writer, website content strategist and marketing and PR strategy consultant. Originally from Eugene, Oregon, Lisa is currently based in Covington, Kentucky (also known as greater Cincinnati, Ohio).
Kirby Mcgivney