Categories for Raise Credit Score

Improve Credit Score

March 29, 2011 5:00 am Published by

Improve Credit Score

Whether your credit score is high and you want to bump it up a few more points or you are in desperate need to improve your credit score, here are a few tips and tricks to help you…

Use credit cautiously. Yes, paying off your balance at the end of the month is a good thing, but depending on when a lender pulls your history, it is possible to still show a balance. Creditors like to see clients using credit with care so they know you won’t have any problem paying them back.

Only use a small portion of your available credit. When a credit score is ran, it will examine how much available credit you have and how much of it you are using. If the percentage you are using is too high, it will penalize you. The ideal percentage is as close to zero as you can get it. Most creditors don’t want to see anything over 25% to 35% depending on whom you ask. Anything above 50% can really start to hurt you, so keep it at 25% to be on the safe side.

Don’t carry a wallet full of cards. This might come as a surprise to you, but the people with excellent credit scores don’t use credit near as much as someone with a poor credit score. These people with excellent credit scores apply for credit about twice a year which is much less than average. You might look cool in front of your friends with a stack full of credit cards but this will not impress your lender.

Make your payments on time. Making a late payment is one of the worse ways to harm your credit score. It can drop your score as much as 100 points which will be difficult to earn back. One late payment will hurt a great credit score more than a poor one.

Think of credit as a safety net. Way too often, people are using credit cards to buy items that are not needed. When creditors pull your history, they take note to these items that have been purchased and use that to determine your “creditworthiness”. Credit should be used for major purchases such as a home or car. And credit cards should be used for expenses such as home appliances, auto repairs, or emergencies. In other words, expenses that are immediately necessary but are difficult to pay for all at once.

Check out the average credit score

 

Source: http://www.creditscoregain.com/improve-credit-score/

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What Is A Good Credit Score

March 27, 2011 5:00 pm Published by

What Is A Good Credit Score

I get asked all the time, what is a good credit score, and like everything else in life, my response is, it depends. For most people a credit score above 700 is generally considered to be a good score, but if you are emerging from bankruptcy, it may take a while to raise your credit score above 500.  At the higher end of the spectrum is a credit score above 800. In the old days, AKA, six years ago, an 800 credit score was pretty common, but not anymore. The credit score range is 300 to 850 and most consider anything above 700 to be good credit. The problem is that each agency has their own way of calculating a credit score.

Then, there is the question of which of the three major credit reporting agencies are you talking about?

Before we begin, please try to remember that you are not your credit score. Yes, you may have had hard times. You may be the victim of an economic downturn and you may have even fallen behind on your bills, but a credit report score does not define the person you are. It is merely an indicator of how likely it is that you will be a good credit risk in the future. Credit scores are dynamic, which means they change every day. Yesterday’s 500 might be tomorrow’s 600.

Here’s a refresher on your question, what is a good credit score.

There exist three major credit reporting agencies in the United States. Each is charged with gathering and reporting the buying and spending habits of individuals who use credit. Since most people are not able to plunk down cash for large purchases, like a home, people rely on the leverage of credit for ownership. This type of spending extends to every day purchases too. Cars, electronics, travel and college, are items being financed. Interest rates are issued depending on risk.

The three major credit reporting agencies are Equifax, Experian and Transunion. If you purchase anything on credit, your credit report score will be recorded in one or all of these databases. Though your score will never be the same from each, your spending habits as well as how timely you pay your lenders are part of the credit matrix which ultimately is defined by a credit report score.

Listed below is a rough explanation of the credit score scale and how your credit report scores are determined. Keep in mind that you are in control of your credit score. Depending on how you handle your finances will determine how much you pay in interest rates.

Approximately 35% of your score is based on your payment history.

Are you late in paying your bills or are you on time? Have you filed bankruptcy? Keep in mind that certain consumer debt, like credit card purchases, are amortized daily. This debt is deadly and best paid earlier than 30 days.

Approximately 30% of your score is based on how much you owe.

there is a formula used that calculated the amount of debt you are allowed to have and how much of that credit you have used up. This ratio is very important as it tells an important story of how well or poorly you are living. If you are relying on credit to finance your lifestyle or if you are a casual user, this is important to lenders. Try to keep this debt to credit ratio under 30%.  That means if your credit card limit is 00, don’t carry a balance of more than 00 at any given time.

Approximately 15% of your score is based on the length of your payment history.

How long you’ve been at the game of credit is a factor used to determine your credit score. A longer credit history will be a plus as long as you show responsible debt management.

Approximately 10% of your score is based on new credit.

Old credit is better than new credit because it shows history and like a favorite old shirt, the lenders are comfortable with the familiar. A question that keeps coming up is how new credit checks affect your credit score and the answer is that they usually drop slightly. Except when you are shopping for a home mortgage, you can expect that by opening new credit, your score will be affected. If you are shopping for a loan, do so in a fixed period of time and the reporting agency will note this.

Approximately 10% of your score is based on miscellaneous factors.

What type of credit do you carry? Installment loans? Revolving credit, credit cards and auto loans, home loans and various lines of credit. Usually this has a stabilizing effect on your credit score because it is normal for people with longer history to carry these types of debt. Certain loans, like jewelry and last resort types of credit will decrease your score.

You can get assistance if you feel you have been treated unfairly in matters of credit. By law lenders are not allowed to consider race, religion or gender in evaluating your credit applications. Your credit scores too will not be based on these factors and if you believe you are being discriminated because of these, contact an attorney.

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Chuck Machado is with the commercial finance company CMA Capital Funding Inc, located in Southern California. He writes extensively about loans, debt, and commercial financing. If you have questions or comments, he encourages his readers to contact him through his website  where he provides tips and education on debt management.

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Increase Your Credit Score And Improve Your Life

March 25, 2011 5:00 pm Published by

Increase Your Credit Score And Improve Your Life

Have you been turned down for a loan, mortgage or credit card?  Has your credit score bottomed out due to missed payments or loan defaults? Do you know how you to increase your credit score?

A low credit score can lead to a lower standard of living, as you are denied credit for business, cars, or homes or extended credit with high interest rates. Maintaining a good credit score is especially important today.

Almost all creditors use scores as a way of judging an applicant’s creditworthiness   The creditors are taking risk when they give someone access to their money so they need a way to be reasonably sure you’ll pay them back.  The credit score, or FICO score, is a popular tool that allows them to quickly make reliable decisions about a credit applicant.

Here are just some of the ways to increase your credit score:

1. Avoid applying for credit too frequently. Every time you apply for credit, a lender makes an inquiry. These inquiries are recorded in your credit record and if you have too many, your score will be lowered.

2. Always pay your credit cards on time. THIS IS THE MOST IMPORTANT.  Credit card companies always report late payments and this will lead to a poor payment history on your record.  Because you are judged to be a risk, your score will be lowered.

3. Avoid high outstanding balances on your credit card.  Keep your cards paid down and don’t max them out.  Carrying near the maximum credit is always a poor sign.  You should be reducing your debt over time.  By not doing so, you are viewed as more irresponsible with your credit.  Because of this, your score will be lower.

4. If possible, catch up on missed payments. It is never too late to pay the bill.  Late payments, while still negative, don’t look as bad as a default or a lawsuit.

5. Don’t close unused accounts. This is a mistake that many people make once they get their debt paid off.  Doing this can actually hurt your credit score.  Let me explain why.  Assume you have four credit cards that have a total maximum credit limit of ,000 spread among them.  You have one card paid off completely but still have a total credit card debt of ,000.  Right now, you are utilizing 30% of your credit.  Now you cancel that one card, which did have a 00 credit limit.  Now your maximum credit limit is 00 spread among three cards but you still have a 00 debt.  So now you’re using 38% of your available credit.  This can negatively influence your credit score.  Just cut the cards up if that keeps you from using them.  Don’t cancel the account.

6. On the other hand, don’t think that opening additional accounts with the idea of increasing your maximum credit available will work.  If you take on additional credit too soon, it can lower your score.

7. Having no credit history is also deemed a credit risk by many lenders.  They simply don’t have enough information to judge your creditworthiness.  If you fall in this category, then obtaining one or two credit cards will be beneficial to you.  Just make a few spends a year and pay off the balance.

Credit scores not only influence whether or not you’ll be given a loan, but also influence the rates you will be offered if approved. A low score means you’ll be paying a higher interest rate on the borrowed money.  This can cost you thousands of dollars, depending on the type and amount of loan received.  Some employment agencies and employers also check the credit scores of applicants before making a hiring decision.

As you can see, increasing your credit score can improve the quality of your life.  Fortunately, there are simple ways to raise your score over time.  You just have to be more responsible with your credit and pay off your debts in a timely manner.

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Alex Post likes writing about credit issues.  He currently writes for the drip coffee maker blog located at DripCoffeeMachine.com

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Paying a company to raise your credit score?

March 24, 2011 5:00 am Published by

Question by A A: Paying a company to raise your credit score?
I remember hearing a while back that there’s some companies you pay that can raise your credit score.

I’ve heard its illegal to do but there’s companies that you can pay to raise your score. What is the deal with this? WHy is it illegal? How is it done?

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Best answer:

Answer by Landlord
They would have to commit fraud to raise your score and both fraud and an accessory to fraud are felonies.

What do you think? Answer below!



What Is A Good Credit Score? What is A Bad Credit Score? How Do I Improve It?

March 23, 2011 5:00 am Published by

What Is A Good Credit Score? What is A Bad Credit Score? How Do I Improve It?

Individuals who have good credit scores are always afforded more opportunity than those who don’t.  They’re eligible for loans and other forms of credit at substantially lower interest rates.  They also live with a sense of security, knowing credit is available to them if they truly need it.  Their good scores serve as an assurance to creditors that they are a low credit risk and can be trusted with money.  If you have a bad credit score, you can expect substantial difficulties in obtaining credit. When you do get credit, it is usually provided with extremely high interest rates that range from 30% APR and higher.  Your bad score makes you a financial risk and most lenders simply want to stay away from from you.

Most people simply don’t realize the full impact of having a bad score until it is too late.  Interest rates usually begin creeping up as your score goes down.  These rates can have a financial impact.  Higher interest means you pay more money to simply service the debt, which means less money goes to paying off the debt and to cover other household expenses.  If you plan to get a loan, it is advisable that you improve your credit as much as possible.  To have an idea of what a good score is, you need to understand the score range.

A credit score ranges between 300 to 850.  The average credit score in the last few years has been around 650 to 670.  Your goal should be to have a score above the national average.  Aim for 700.  With that, you will have a solid credit score and will attract better rates for loans.

If your score is around or below the national average, you should start trying to improve it today.  Since the housing bubble popped, lenders have tightened their standards.  Most simply won’t consider a person for a loan who doesn’t have an above average score.  Fortunately, you can take steps to raise your credit score today.  First, find out your score.  Most don’t even know that.  Secondly, don’t make matters worse.  Stop going in debt.  Cut up your credit cards.  Finally, make your payments on time and pay down as much of your debt as you possibly can.  I know for most people this can be difficult, but you just have to get creative.  Look to cut household expenses that are wasteful.  Most people spend more money than they should.  Apply those savings to your debt.  If you can, get a second job or maybe sell off some things on eBay.  Downsize your junk and pay off that debt. You will not regret it.

Using credit responsibly is the only solid plan there is for improving your score.  You just have to reestablish a pattern of paying your debt obligations.  Beyond that, you need patience to see this through.  After a few months you will notice improvements in your score as creditors report your positive payment activity to the credit agencies.  Start today and you will see results sooner.

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Alex Post enjoys writing about credit related issues.  He also writes for the online coffeemaker blog which reviews coffee machines

Article from articlesbase.com

The fastest way to raise your credit score depends on how much you want to raise it and what your credit score is now. Some of these credit score improvement techniques include: 1) removing negative items from your credit report; 2) improving your debt to credit ratio; which is your total ratio of debt to credit. For example: If you have 000 in credit and are 00 in debt, your total debt to credit ratio is 25%. You want your debt to credit ratio to be as ‘low’ as possible. For example a credit ratio of 10% would be better than 20%. You can use subprime merchandising cards to improve your debt to credit ratio. 3) enhancing your credit profile by having a diverse amount of credit such as a home mortgage, car loan, line of credit with your bank and credit cards and subscribing/belonging to affluent publications and organizations.
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