Easy Steps To Maintain A Good Credit Score

A good credit score can be an asset when you need it most. But if you don't regularly monitor your credit status, your credit score can become a liability. Have you checked your credit report lately?

By law you are able to obtain a copy of your credit report free every 12 months from each of the three nationwide credit reporting agencies, Equifax, Experian, and TransUnion. The three companies have formed a central agency so that you can request a copy from all of them at once. It’s called Annual Credit Report and can be accessed online.

This free credit report can be a valuable tool in maintaining your lifestyle and can save you money. By monitoring your credit report on a regular basis, you can catch any errors that may have been recorded and see that they are corrected immediately. Also with the increased crime of identity theft, with a vigilant eye on your credit reports, you can catch any funny business early.

There are just a few things you need to do to maintain a good credit score.

-First and foremost, make your payments on time.

-Stick within your budget and manage your debt.

-Do just what you're doing and monitor your credit report regularly to correct any possible errors.

-Try to avoid any unnecessary inquiries of your credit report, as each request can be marked against your good credit score.

-Reduce your credit card balances if they're limited out.

-If you don't have enough credit history, you may consider applying for new credit.

By carefully reviewing your credit report on a regular basis, you can be sure that you maintain a good FICO score. "What is a FICO score?" you say.

The FICO score is the 'grade' with which financial institutions use to judge the risk they take when extending you credit. The higher the FICO score, the better. The scores generally range from 499 - 800 plus.

By keeping a close watch on your credit reports, you can help to protect your good credit. Whether it's a car loan, credit card, or mortgage, your credit score can dictate the interest rate of your new loan. A good credit score can save you money.

Do You Need To Improve? Credit Scores Count

To improve your credit score, you have to take steps to improve the rating that the credit bureaus give you on your credit report. The score is the grade they give so that merchants know whether or not you a good risk for them to lend money or allow you to have a credit account. If you have a low credit score, then you know you have to improve. Credit scores will determine whether or not you get a loan for a new house or a new car. If you need to improve credit scores there are ways.

There are recognised ways to improve credit scores and once you do improve your credit score you will qualify for more loans – sometimes more than you want. If you are in the market for a loan, it is a wise decision to review your credit score at least six months prior to submitting the application. This way if your score is low, you have an opportunity to improve your credit rating for at least six months before the lender does a credit check on you.

The credit score that shows up on your credit report tells creditors about your repayment habits. If you really want to improve your credit score, you need to know that score. If you find mistakes in your credit report, then you have to take steps to get them corrected in order to improve your credit rating. You will have to contact the credit bureau to find out the process involved in correcting any inaccuracies you find. Although this is one of the ways to improve credit scores, it only works if there are legitimate mistakes and you can prove it.

If you notice that you have been late making your payments or you have missed some entirely, one of the ways to improve credit scores and improve your credit rating is to start paying your bills on time. If you have any outstanding payments, you should also take steps to bring the accounts up to date. This will go a long way to helping your improve your credit score.

If you have all your credit cards maxed to the limit, this will also reflect badly in giving you a low credit score. If you want to improve credit scores, start paying on your credit cards and try not to use them. When your balance starts to go down, your credit score will start to rise. One idea for helping you improve your credit score is to cut up your credit cards so you can’t use them. Also, one of the ways to improve credit scores is to try to pay more than the minimum amount. This speaks volumes when it comes to your credit score.

There are some ways to improve credit scores. You just need to know how to do it.

Did Your Credit Score Today?

Keep Your Credit History Clean - Remove A Negative Credit Record From Your Credit Report

It can make a difference of up to 18% in loan repayment costs. For example, on a 30-year, $150,000 fixed rate mortgage, a borrower with the best credit score, 760-850, will pay 5.59%, or $860 per month, while someone in the worst score range will pay 7.18%, or $1,016 per month. This can make a big different to the household budget, so it's to your advantage to keep your credit score as low as possible.

The 3 major credit bureaus, Experian, Equifax and Trans Union are similar and feature a "Credit Score", which is derived from credit report information submitted to them about you.

Under the Equal Credit Opportunity Act, a credit scoring system may not use characteristics such as race, sex, marital status, national origin or religion as factors, though they are allowed to use age.

Credit scores are determined by your bill-paying history, the number and type type of accounts you have, late payments, collection actions, and outstanding debt. The total number of points reflects how likely you are, statistically-speaking, to pay back a loan.

If you are denied credit, the Equal Credit Opportunity Act forces the creditor to tell you the specific reasons your loan application was denied if you ask within 60 days. Acceptable reasons include high balances on charge cards, or bad employment history. Unacceptable reasons include vague excuses such as "You didn't meet our minimum standards". Sometimes you can be denied credit because of information on a credit report. The Fair Credit Reporting Act requires the creditor to give you the contact information of the credit report agency supplying the information. The credit reporting agency can give you the information on your report, but only the lender can tell you why this led to your application being refused.

However your credit report may include inaccurate or incomplete information (credit records). Identity theft is a growing problem, and can take up to a year to resolve. Nearly 10 million people fall victim to identity theft each year, costing consumers $5 billion and businesses $48 billion, according to the Federal Trade Commission.

In this situation you have to send letters to every one of the credit bureaus. Also learn your credit rights by familiarizing yourself with the Fair Credit Reporting Act (FRCA).

The FCRA gives you the right to dispute inaccuracies and omissions, and it requires credit bureaus to investigate your complaint (generally in thirty days), send you a prompt response and correct any errors. The law as well requires the source of inaccurate information (such as a bank) to correct the record at the credit bureaus to which it initially provided the erroneous information.

Consumers working on their credit reports say many times their letters are ignored by credit bureaus. Consumers say even with proof a credit record isn't theirs, its removal from their credit report can take 3 or even 4 challenge letters, because the credit bureaus will have only corrected the facts in their own files and not updated the credit report.

Send your dispute letter by REGISTED MAIL. Credit companies will respond faster if they know you can prove you filed a complaint on a certain date. Keep a record of when you sent the dispute letters and what date you should expect a response. If you have received no defense to your claim after thirty to thirty seven days, send another registered letter requesting an updated credit report and demanding the disputed credit record be deleted.

If the bureaus don't reply in the thirty days, it must be that the information they had on file was either inaccurate or unverifiable. In either case, based on data from the Fair Credit Reporting Act, the credit record must be immediately deleted from your credit report.

A few consumers have eliminated negative marks on credit reports just by going through this process of disputing credit records many times. Since some creditors will not take the time to respond, you can sometimes win by default. Usually a bit of progress will be made with each challenge.Remember, the credit bureau would like you to quit bothering them because if you are not disputing the credit report, they can legally carry on selling it as profitable information.

Credit Score Repair – The Higher Your Score, The Better For Your Credit

Credit score repair means that you want to take steps to improve the credit score you have on your credit report. A good credit score means that creditors see you as a good risk to repay the money you borrow. The higher your score, the more loans and lower interest rates you are likely to qualify for. If you have a low credit score, then you do need to consider ways of credit score repair.

What does my credit score mean? This is one question that people often ask when they get their free credit report. In order to do well with credit score repair, it is necessary to know what information the score is based on. One important factor is your payment history. This is the details of your accounts, your monthly payments and whether or not you make them on time. If this is what is causing you to have a low credit score, then a simple way of repairing your credit score is to start paying all your bills before the due date.

What is considered a good credit score? Credit scores range from 375 to 900. Most people with good credit have a score around 600 to 650. If you have a score higher than 650, then you are in good financial shape when it comes to getting credit and you don’t have to worry about credit score repair. It is when you see your score below 550, then you have to start taking steps to repair the score.

How can I find out what my credit score means? If you look for information about credit scores online, then you will find the percentages that each of the following are involved in computing the score: payment history, amount of money you owe, length of time you have been borrowing, the types of credit you use and the amount of credit you have received recently. There is also a section of your credit report that tells how many times you have applied for credit in the past few months. If there is a list of names, you have to stop applying in order to do credit score repair.

Credit score repair is not something that will happen after a month of paying your bills on time. It is something you have to work at and it could take six months or more for you to notice a gain in your credit score repair. Just keep the range of a good credit score in mind and work at paying your bills. No one can do this for you – only you.

Credit score repair is perfectly possible, despite what you may have been told. But don’t expect it to be fast.

Credit Score is Important When Buying a Car

Do you check your credit score and credit report before you go shopping for a car? You might find out that it is well worth your while to do so, as some auto dealers are taking advantage of the fact that many consumers do not know their credit scores.

No one likes buying a car; the entire process is awkward and cumbersome. Most items we buy are plainly marked with the price, but with cars, the price is often a mystery. Then you have to haggle with a salesman and hope that you have worked out the best price possible. Having done that, you have to arrange financing. You can often get an acceptable interest rate when financing through the dealer, but some dealers are padding their bottom line by offering loans at higher rates than they otherwise might.

The scam works like this - You negotiate your best price with the dealer and you agree to finance through them. You fill out the credit application and hand it over to the salesman, who has promised you some reasonable terms. He takes off to process the application and to check your credit report while you have a cup of coffee. He returns a few minutes later, shaking his head. He informs you that your credit score is only 600 and that you will not qualify for the interest rate he offered you. He says that you will have to pay a higher rate. And not knowing any better, you agree.

Had you done your homework by checking your credit score ahead of time, you would have known your actual credit score and you could have pointed out that the salesman's assessment of your credit score was incorrect. At that point, you could insist upon receiving the more favorable interest rate or threaten to finance elsewhere. This is a common scam that works because most people really do not know their exact credit score.

Learning your credit score is easy. All you have to do is visit the Websites of one of the three major credit bureaus - Experian, Trans Union or Equifax. For a modest fee, you can receive a copy of your credit report with your credit score. Armed with this useful piece of information, you can shop for a car with a bit more peace of mind, knowing ahead of time whether or not you can qualify for the best financing.

Credit Score Improves by Paying on Time

These days, everyone seems to be concerned about his or her credit score. Lenders and credit bureaus have made it clear that the credit score, whether the new VantageScore model or the FICO score model, is a vital part of determining whether or not to extend credit to a consumer. The score is a distillation of a number of factors that make up a consumer's credit history and it allows a lender to see, at a glance if the would-be borrower is worthy of the loan.

Not only will a high credit score make it more likely that a consumer will get a loan, but the score will also help determine whether that loan will be granted at a favorable interest rate. The best interest rates are given to those with the best scores, and those with lower scores will have to pay higher interest rates and fees. Because of this, many consumers are interested in knowing how to improve their scores, and there is not shortage of companies that are willing to provide advice on that topic for a fee.

But the one thing that every consumer can do to increase his or her credit score is easy to do and costs nothing - pay bills on time. It may seem both simple and obvious, but a history of paying bills on time is important to creditors. After all, the decision regarding whether or not to grant a loan is based in part upon whether or not the lender expects to be repaid. The more likely the consumer is to repay, the less likely he or she will be to default.

How a consumer has historically paid bills makes up 35% of the credit score. More than one third of the score is devoted to whether the bills were paid on time or paid at all. No other component makes up as large a portion of the score, and for good reason - lenders want to be repaid! That said, the easiest and cheapest way to start improving a credit score is to make a concerted effort to pay bills on time. It is better to make even a minimum payment on time than it is to pay late and in full. With online bill paying becoming more and more common, it is not possible to schedule bills to be paid automatically, which can be of tremendous benefit to those consumers who aren't too organized and sometimes just forget to pay.

This is one of those cases where the most effective solution also happens to be the cheapest, and this solution is free. If you want to see your credit score increase, make sure that your bills are paid on time.

Credit scores, credit history & credit qualifications... is it really that complicated?

Credit when used as a financial term, used in such terms as credit card, refers to the giving way of a loan and the formation of debt. Any movement of financial capital is in general quite reliant on credit, which in turn is dependent on the reputation or creditworthiness of the entity that takes responsibility for the funds. An identical treatment is in commercial trade, where credit is used to refer to the approval for overdue payments for goods purchased. From time to time if a person has financial instability or difficulty, credit is not granted.

Companies regularly offer credit to their customers as part of the terms of a purchase agreement. Organizations that propose credit to their customers frequently provide work for a credit manager. A unit of account provides denomination of credit. Not like money credit itself cannot act as a unit of account. Credit is as well traded in the market.

The purest form is the Credit Default Swap market which is for all intents and purposes a traded market in credit insurance, i.e. a credit default swap represents the price at which two counter parties will exchange this risk - the protection seller takes the risk of default of the credit in return for a payment, commonly denoted in basis points of the notional amount to be referenced, at the same time as the protection buyer pays this premium and in the case of default of the underlying (a loan, bond or other receivable), delivers this receivable to the protection seller and receives from the seller the par amount.

Credit history
Credit history or credit report is, in a lot of countries, a record of an individual's or company's precedent borrowing and repaying, together with the information about late payments and bankruptcy. The term credit reputation can also be used synonymous to credit history or to credit score.

Once a customer fills out an application for credit from a bank, store or credit card Company, their information is forwarded to a credit bureau, along with regular updates on the condition of their credit accounts, address or any other changes you may have made in view of the fact that the last time they applied for any credit. This information is used by lenders such as credit card companies to settle on an individual's or entity's credit worthiness; that is to say, determining an individual's or entity's means and willingness to repay indebtedness. This helps concluding whether to extend credit, as well as on what terms.

With the adoption of risk based pricing on more or less all lending in the financial services industry, this report has become even further vital since it is more often than not the sole element used to choose the APR (annual percentage rate).

Credit score
In the United States, a credit score is a three-digit credit rating that represents a calculated approximation of an individual's financial creditworthiness as intended by a statistical model. A credit score attempts to calculate the likelihood that a potential borrower will fail to repay a loan or other credit obligation satisfactorily over a specified period of time. A credit score is characteristically based on the information in an individual's credit report.

Lenders such as banks and credit card companies use credit scores control the risk posed by lending money to consumers. Examples of such uses take account of determining who qualifies for a loan, assigning an interest rate, assigning credit limits, and managing accounts that are already open. For instance, treatment of accounts those are in default. The use of credit or identity scoring prior to authorizing right of entry or granting credit is an implementation of a trusted system.

Credit Repair Scheme Promises Fast Score Increases But May Be Illegal

Establishing a good FICO credit score isn't all that difficult; all you have to do is pay your bills on time. But if you have a bad credit score from a history of not paying your bills promptly, repairing your score and building it up to a level where you can get competitive loan rates can take time. It can take several years of paying your bills on time to build up your score and it can take seven years to wipe out a judgment or a bankruptcy from your credit report. Most consumers, understandably, would rather not wait that long and there is not shortage of companies that promise to repair credit quickly.

Several companies are offering dramatic increases in credit scores of up to 200 points in as little as 60 days using something known as "seasoned credit." The concept is simple - if you are added to the credit account of someone with good credit as a cosigner, that good credit will add to your own credit score. What these companies do, for fees ranging up to $5000, is arrange to add your name as a cosigner to the accounts of willing participants who have good credit of their own.

Adding a cosigner to an account isn't illegal; husbands and wives add each other to their own accounts all the time. What is illegal about this scheme is that it is a deliberate effort to manipulate credit reports and credit scores. If it is done for purposes of qualifying for a loan for which the borrower otherwise wouldn't qualify, such as for a mortgage, it constitutes fraud.

In addition to the questionable legality of the practice, there are some other reasons why this sort of credit "repair" should not be attempted. The idea of having someone else's credit rub off on you works both ways. Customers of these companies have no idea whose accounts their names are being attached to, and if those customers stop paying their bills, then their credit score will go down along with yours. None of this is under your control; you are stuck with whomever they stick you with. Since these companies advertise that once your score increases, you can become part of their "good credit network", it only stands to reason that you may have your name attached to that of a person who only recently had a bad payment history, too.

Increasing your credit score by 200 or more points in 60 days' time sounds like a great idea. But the risks of paying someone thousands of dollars to do it for you are great. It is better to build your credit the old fashioned way by taking your time.

Credit Repair Advice: How To Improve Your Credit Score

Our credit scores determine much about how we live our lives. We buy practically everything on credit. When applying for a loan, our good credit scores help us receive reasonable interest rates. In fact, from landlords, to insurance companies, to utilities, everyone looks at our credit scores, as they are a reflection of our financial health. A healthy credit score may determine what various agencies will charge for their services. Today, even employers check personal credit scores before offering a job.

Knowing more about our credit scores and the factors affecting them may help us build a positive credit history. But first, let’s look at how they are maintained by the various credit reporting agencies.

Three major credit bureaus - Equifax, Experian, and TransUnion - calculate credit scores. Though they use the same methods and formula to calculate scores, they sometimes come up with a different rating for various reasons. One agency may have more updated information about an individual. A creditor may have shared information with one agency only, but not with the others. Creditors, while checking on our scores, take the average of the three scores from these three agencies.

Credit scores range between 300 and 850. A score of 680 and above is excellent for obtaining mortgage financing at low interest rates. A credit score of 621 to 679 is an average score and you would have to pay a slightly higher rate of interest. A credit score of below 600 makes us potentially unreliable and harder to obtain credit. When a credit score falls below 600, credit repair steps should be taken immediately.

The following are factors affecting credit scores and basic steps to take to maintain an accurate credit score rating with the credit bureaus:

1. Routinely check payment history and the current credit debt held.

2. Credit history length is a determining score factor. Naturally, the longer a ‘good’ credit history, the better.

3. Do not close old or paid off accounts. These show the credit history length and contribute to higher credit scores.

4. Pay off debts to improve credit scores.

5. On-time payments. Delayed payments appear on credit reports and adversely affect it.

6. An individual’s race, sex, age, level of education, or marital status has no bearing on a credit score, nor does the fact that an application for credit was previously turned down.

Taking care to maintain a high credit rating enables us to receive credit and loans at good rates. Our credit score is a reflection of how we manage our finances and a determining factor for many aspects of our lives. Knowing early on how to have a healthy credit history is the best way to avoid bad credit and limited loan options in the future.

Car loan with bad credit score - Is this possible

Are you considering buying a car but afraid just because you have a bad credit score? Bad credit score does not mean end of the world. It’s true that having a good credit score is very much important. But a person with bad credit score can also get his loan approved.

There are number of money lender who offer loan to individual who have a bad credit record. The only drawback of borrowing loan with a bad credit score is paying high interest rate than what you would have actually paid if you had a good credit score.

How can you get car loan with a bad credit score?

1.    Don’t rely on the money lender: You might come across many money lenders who will agree to pay you credit. It’s very important that you do not haste in getting your car loan approved. Money lenders may try to rip you off just because you have a bad credit history. You must compare the rates of different money lenders but actually arriving at a decision. A good search can help you fund lenders who are willing to provide you loan at a much lower interest rate.
2.    Check your credit report: It’s very important that you check your credit report but applying for a loan. Checking your credit score can only help you improve your credit score. The reason for this check is that there might be certain errors in your credit report. It’s 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. This in turn will directly affect your loan gaining capacity.
3.    Repair your credit score: If you find any errors or flaws in your credit report it would be advisable to contact the credit agency as quickly as possible. Get the error rectified and find improvement in your credit score.

Can we dispute our own official credit scores?

Many of us wonder even if it is this legal to do so. Well, YES, you are given the right under the Fair Credit Reporting Act (FCRA), including the right to challenge inaccurate, misleading and obsolete items appearing on your credit report. Disputing items on your credit report is your legal right (see the Fair Credit Reporting Act)! This article is meant to provide important information about the possibility of having credit restoration.

For starters, you should know on what is your credit score based. Credit scoring is based on many factors that may include:
•    Amount of available credit
•    Payment history
•    Recent requests for credit
•    Amount of credit currently being used
•    Length of credit history
Under the Equal Credit Opportunity Act, credit scoring may not use gender, marital status, national origin, race, or religion as factors.

So, getting to the point: can bad credit be deleted? Well… YES! Negative credit listings are deleted from peoples' credit reports each and every day! Still, you might need to get some professional support and assistance. Companies specialized in  topazcreditrepair credit repair in Phoenix will use very venue available to you under the law, to help you assert these rights. When you hire professionals to help repair your credit, they will be abiding by and using all federal and regional laws regulating third party credit repair assistance.

 topazcreditrepair services.php Arizona credit help firms are working hard every day, challenging damaging and questionable credit entries on behalf of its clients. Utilizing proven and absolutely legal methods, you will have a professional organization working for you and your credit.

There are many of you who will say “OK, but how long does it take? Of course, everyone wants you to see results immediately. Most people can see progress within the first 45 days of credit repair services, although everyone's credit history is different. Don’t ignore the fact that the majority of time is spent waiting for the credit bureaus to respond to requests. It takes great effort in getting the disputes to the bureaus as fast as possible. As a reference, the average person with 7-10 inaccurate, misleading or obsolete items on each credit report should be prepared for a 3-4 month commitment.

Maricopa Credit organizations have been helping people get rid of negative items on their credit reports, increasing their FICO score dramatically. With a higher FICO score, their clients have been able to refinance their auto and home loans, saving a considerable amount of money every single month!

Just keep in mind that you’d still have to pay your bills. When a negative credit report listing is deleted, the actual debt remains. You still owe the same amount of money that you owed to begin with. If you don't pay the debt, the creditor or collection agency could always report the item again. So removing the listing without addressing the debt is only a temporary solution.

For even more information and real help, you should find a firm helping hard working men and women repair their credit reports. Such  topazcreditrepair warranty.php credit help companies help thousands of Americans repair their reports by removing inaccurate, misleading, or unverifiable items for them. From bankruptcies to charge offs, their staff have challenged and deleted such items with ease. After your own research, choose the best firm, the one with no hidden fees, offering unlimited disputes and not charging per deleted item. Whether you have one or one hundred negatives items, you must be backed by a Money Back Guarantee policy.

A Love/Hate Relationship: How your credit score can open and slam doors for you

There are many ways to get ahead financially: attend seminars where you cut up your credit cards with hundreds of other people, participate in debt consolidation services that help you take out a home equity loan or refinance your home, or you can transfer debt on one credit card to another credit card with an introductory rate of 0% (which goes up to 12% six months down the road). The reason these methods don’t work is because we don’t concurrently cut our expenses while implementing these strategies. Even if we’re making more money, unless we cut expenses, we will continue to spend more money than we have and incur debt. Manage yourself and your money. Money is like food; we don’t eat only when we’re hungry, and we certainly don’t spend only when we need something.

Beware: Debt forgiveness can hurt you. The company that forgives your debt can issue a 1099C, which means the forgiven amount gets added to your taxed income.

When there’s a will, there’s another way:
Your credit score (also called your FICO or Beacon score) will affect the interest rate you’re able to secure. Credit scores range from 500 to 850. Where are you on the scale?

What’s in a number?
500 and below—your in serious trouble
650 to 680 you probably will have a difficult time getting credit, and if you do it will be at higher rates
700+--excellent score

How you got your credit score:
a)    Payment history (35% of score). Make payments on time or early.
b)    Amounts you owe (30% of score)
c)    Credit history (15% of score). The longer you have credit, the higher your score can be.
d)    New credit (10% of score). New credit cards.
e)    Type of credit you have in use. Mortgages, Bloomingdale’s, etc.

There are three reporting services that can give you your score: Equifax.com, Experian.com and Transunion.com. At least once, do an experiment and order a report from all three. They probably will provide a complimentary report each year, per person. You will most likely find inconsistencies in the reports such as missing and incorrect information. Each time a credit report is run on you, your score is lowered by two or three points. You still want to shop around for a mortgage, but consider using a mortgage broker who runs one report to shop around the loan. If you go to five different banks, that can drop your score 15 points.

A Crash Course On Credit Scores

You sit down to look at your credit report for the first time. If you’re scores are above 720, congratulations! You have excellent credit; stop worrying. If you’re scores are not above 700, no problem—let’s get to work. Take solace in the fact that the national average score is around 676 according to the Gallup Organization. If you’re scores are below 400, 500, or 600, there’s definitely room for improvement and only one way to go—up!

If the numbers I’ve mentioned don’t make any sense to you or you have no idea what they mean, don’t fret—I’ll explain. Credit scores range from 350 to 850. All three of the credit bureaus—Equifax, Experian, and Transunion—offer FICO credit scores using a complex mathematical formula developed by Fair, Isaac and Company, but they each give the scores a different name: At Equifax, the FICO is known as the Beacon credit score; at TransUnion, it’s called Empirica; and at Experian, it’s called the Experian/Fair, Isaac Risk Model.


If you’re credit scores are above 720 you have excellent credit and will able to get the best interest rates available. As your credit scores drop, the interest rate you’ll receive for a home loan will rise: this is known as tiered pricing. The more of a risk the lender takes on you, the higher your interest rate will be. In addition, all lenders have their own break points between tiers. What this means is that one lender may raise the interest rate if a score drops below 700, while another lender won’t give a higher rate until the score drops below 690. In summation, you should do everything in your power to maintain good credit scores, and be sure to shop around and do your homework when looking for a home loan because all lenders are not created equal. I think you’ve already gleaned the moral of the article but just in case you haven’t, here it is: Good credit scores save lots and lots of money, and be sure to choose a lender wisely to get the best rate for your scores.

An Average Credit Score – It Is Important When Borrowing

The average credit score is the rating that the 3 major credit bureaus assign to your credit report. It is based on your borrowing and repayment habits and depends on how much money you owe and how many times you have applied for credit. If you have a low credit score, there are ways of improving it. In general, an average credit score tells creditors that you are a good risk for them to lend you money.

Computing a credit score is a scientific process that Experian, Trans Union and Equifax use and each one has its own unique system. The credit score range is between 375 and 900, with around the 600 mark being the average credit score. In order to find out what your credit score is, you need to request a free copy of your credit report. This will give you an idea of what creditors see when they do a credit check on you.

If you find that your average credit score is below 500, then you are in the lower part of the credit score range. It also means that you have to take steps toward improving credit scores. For example, if you plan to look for a loan for a new car within the next year, you should start now by making a diligent effort to pay all your bills on time. If you apply for a loan, even if you are accepted based on your earnings, every person that asks for your credit score shows up on your credit report. This deters some creditors because they think you are a compulsive borrower.

The higher your credit score, the better chance you have of being granted credit. This is why you should always know what your credit report says about you and what your average credit score is. The credit score range you fall in not only determines whether or not you get a loan, bit it also determines the interest rate you have to pay. When you understand what creditors are looking for, you can work towards improving credit scores. When your average credit score is good, you will save money in the interest rates charged on the loan.

An average credit score is fine, although you can always do better.

Adverse Credit Mortgages - Getting Approved With A Low Credit Score

Having good credit affords more home loan options. Luckily, many mortgage lenders understand that bad credit happens, thus many are willing to offer home loans to people with low credit scores. Of course, the best way to improve your odds of getting a low rate is to boost credit rating. Still, it is possible to get approved with poor credit. Here are a few tips to consider when applying for an adverse credit mortgage.

Expect a Higher Mortgage Rate

Although many lenders offer comparably low rates to homebuyers with low credit scores, these rates are slightly higher than current averages. Fortunately, because of low mortgage rates, individuals with poor credit can find affordable homes.

If you had a recently discharged bankruptcy or foreclosure, the rate you obtain on a home loan may be several percentage points above the average. Hence, it may be wise to delay buying a home until your credit improves. On the other hand, if you are hoping to quickly increase your credit, and you can afford a large mortgage payment, purchasing a home immediately following a bankruptcy or foreclosure may be an ideal choice.

Take Advantage of Sub Prime Mortgage Lenders

Traditional mortgage lenders typically offer loans to people with good credit. These persons are considered prime applicants. If you do not fit into this group, don’t worry. There are many lenders that focus on bad credit home loans.

Sub prime lenders offer loans to people with all credit types. In fact, it is possible to get approved for a home loan with very low credit. This is great because some mortgage lenders do not approved loans to people with a credit score below 600.

Improve Your Chances of Getting Approved

If you have a very low credit score, it may take some time before you notice a major credit score increase. Still, you should start improving credit early. Raising your credit score by a few points may qualify you for a better rate.

Maintaining good credit is easy. However, you must use credit responsibly. This involves paying your creditors on time and reducing total debts. If too much debt is the problem, consider working with a non-profit debt consolidation service. Furthermore, credit counseling can offer practical tips on how to better manage credit.

5 Tips For Improving Your Credit Score

Here are 5 tips to help improve your credit score.

1. Get copies of your credit report —then make sure the information is correct.

Go to the Annual Credit Report web site. This is the only authorized online source for a free credit report. Under federal law, you can get a free report from each of the three national credit reporting companies every 12 months
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You can also call 877-322-8228 or complete the Annual Credit Report Request Form at the Federal Trade Commission (FTC) web site and mail it to Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281.

2. Pay your bills on time.

One of the most important things you can do to improve your credit score is pay your bills by the due date. You can set up automatic payments from your bank account to help you pay on time, but be sure you have enough money in your account to avoid overdraft fees.

3. Understand how your credit score is determined.

Your credit score is usually based on the answers to these questions:

Do you pay your bills on time? The answer to this question is very important. If you have paid bills late, have had an account referred to a collection agency, or have ever declared bankruptcy, this history will show up in your credit report.

What is your outstanding debt? Many scoring models compare the amount of debt you have and your credit limits. If the amount you owe is close to your credit limit, it is likely to have a negative effect on your score.

How long is your credit history? A short credit history may have a negative effect on your score, but a short history can be offset by other factors, such as timely payments and low balances.

Have you applied for new credit recently? If you have applied for too many new accounts recently that may negatively affect your score. However, if you request a copy of your own credit report, or creditors are monitoring your account or looking at credit reports to make prescreened credit offers, these inquiries about your credit history are not counted as applications for credit.

How many and what types of credit accounts do you have? Many credit-scoring models consider the number and type of credit accounts you have. A mix of installment loans and credit cards may improve your score. However, too many finance company accounts or credit cards might hurt your score.

To learn more, see the Federal Trade Commission’s publication on credit scoring at their web site.

4. Learn the legal steps you must take to improve your credit report.

The Federal Trade Commission’s “Building a Better Credit Report” has information on correcting errors in your report, tips on dealing with debt and avoiding scams—and more.

5. Beware of credit-repair scams.

Sometimes doing it yourself is the best way to repair your credit. The Federal Trade Commission’s “Credit Repair: Self-Help May Be Best” explains how you can improve your creditworthiness and lists legitimate resources for low-cost or no-cost help.

5 Things To Protect Your Credit Score This Holiday Season

1. Avoid Department Store Offers for Instant Credit and Don't Open Up New Lines of Credit

"Would you like to save 10% today on your purchase today?". We have all been asked that question when paying for our purchases. Every store under the sun would like to offer you their own credit card. This is not good for your score. The damage to your score you'll incur by opening up a new line of credit is just not worth the few dollars you might save. Department score credit is poor quality credit and the credit scoring system frowns on it. Just don't apply for the card. You may want or need to apply for a new car loan, a new home loan, a re-finance a home loan. By applying for store credit to save a couple of dollars, you could be hurting your chance of getting an important loan at a good rate until the middle of next year.


2. Avoid Overspending

Spending affects credit. 30% of your credit score is made up of how you manage your debt, and when your credit card balances exceed 30% of their available limit, the credit scoring system red flags you and your score goes down instantly. The logic behind this is that if you suddenly max out your credit cards, it looks to the system as though you are in financial trouble. Only charge if you can pay the balance in full before the next statement date. Plus, overspending and overcharging will also cause you to carry larger balances longer. It is best to keep your balances low at all times.

3. Pay Your Bills On Time

Payment history is 35% of your credit score. One 30-day late can cost you 50 points or more. December is traditionally the busiest time of the year. Active calendars filled with work and social commitments for family and friends and the frenzy of the season can preoccupy you and cause you to be late in paying your bills. Make staying on top of your bills a priority. Put all of your bills in a file and make sure you pay them on time. In doing so, you will save points on your credit score and ridiculous late charges as much as $39 or more. Additionally, when you are late in paying your bills, you nullify any preferential finance rate and your account will default to a dramatically higher interest rate. A ding to your credit score, a high late fee, and a huge increase in interest rates are all big incentives to make sure you are on time with your bills. I recently got a call from a customer who had been late, but not 30 days late and the rate jumped on his card to over 30% annually!

4. Take the Time to Plan and Prepare Your Gift Giving

We all do it. We walk into a store ready to buy a specific item and end up getting lured into a spending vortex. Panic spending because the store does not have the item you went in to buy; deciding that if you buy this item for this person, then you have to buy this item for another person; succumbing to the temptation of the latest must-have gadget. You can prevent this well-woven retailer trap by doing your research online. By preparing before you even darken the automatic doorstep of the alluring retail establishment, you can determine where you can purchase specific items and for what price. In doing so, you can avoid the retail traps and retain control of your spending (and your sanity). Online shopping sites have grown tremendously in popularity. Traffic to those sites is up more than 30% from just last year. There is a wealth of information on the web. In fact, pricegrabber.com lists all of the hottest holiday items and tells you who sells them and for how much. Remember, if you pay your credit card bill prior to the statement date, it will help your scores. froogle.com is another great site to find the item for less.

5. Manage Your Credit Wisely

Keep track of your credit card balances and keep them as low as possible. Studies show that as consumers increase their credit card balances, they become increasingly apathetic about their balances and even about adding new debt. By tracking balances, you will maintain a sense of control over your credit score and your finances. Write out a chart of who you owe, how much you owe, and what the minimum payment is. It will help you to get a handle on your bills, and help start planning how to pay them off.

5 Easy and Quick Ways to Improve your Credit Score

Your Credit Score is one of your biggest financial assets. If your credit score is high, your borrowing rates will be low and therefore save you hundreds of dollars. The big mystery is how to maintain a high credit score. Well if you want to either maintain or repair your credit score, you are in luck, it can take as little as two months to raise your credit rating.

Your credit score is based on a few prime factors, there is no particular order in which I will discuss them (Some of them have higher weights in regards to the score). Repayment history, current debt owed, recent credit checks, and registered income (there are other factors as well). In order to repair or raise your score you may follow a few of the steps provided below.

1.)    Pay off all revolving credit cards. Revolving credit cards are like Discover card or any other monthly credit cards. Even though you might pay before the deadline, credit card companies report the debt owed on a monthly basis which may be before the deadline. On your credit score it will not show as bad debt, but it will decrease your overall score. The standard recommendations are as follows. If you have one credit card, pay it off before the months end. Second, if you have two credit cards, pay the minimum on both of them and work on paying in full one of them first.
2.)    Registered Income. This is your official salary from work. Basically the numbers they crunch are matched with what you earn. If you debt is larger than what you earn, your credit score is lowered. So, if you are an independent contractor or your income is just a little too low get a part time job. This will rise your potential earnings and increase your ability to repay your debt and therefore increase your credit score.
3.)    Check your credit score online with one of the official companies to see what or why your credit score is the level it is. This will help you determine what you can really do to increase your credit score.
4.)    Do not apply for every car, credit card, and home that you are looking at as an eager consumer. Because every time you try to purchase a home, car, or get a new credit card your credit score is checked and the crediting agencies lower your score if you have had two or three credit checks withing a few months of each other.
5.)    Lastly, open a savings account and budget your money accordingly that you will always have extra cash to help in times of need.

Protect your credit score because it can mean everything when buying a home or trying to get some capital for whatever purpose you need it for. It is not hard to raise your credit score, it is hard to maintain it. If you can purchase a credit score monitoring service, it will protect you from fraud and help inform you of ways to increase your credit score when needed.

5 Common Credit Score Myths

Your credit score is an integral part of your financial life. It is important that you understand what it's all about. Lenders, landlords, insurers, utility companies and even employers look at your credit score. It is derived from what's in your credit reports, and it ranges between 300 and 850.

Yet, according to a survey that was recently conducted, nearly half of all Americans don't know how these scores are derived or even what factors are used to come up with them.

For example, if your credit score is 580 you are probably going to pay nearly three percentage points more in mortgage interest than someone who had a score of 720.

Or another way of looking at it, if you had a $150,000 30- year fixed-rate mortgage and your credit score was good enough to qualify for the best rate, your monthly payments would be about $890. This is according to Fair Isaac, the company that created the FICO score and who the rate is named afte (Fair Isaac COrporation). If your credit is poor, however, it is very likely that you would have to pay more than $1,200 a month for that same loan.

With so much depending on the credit score, it’s important to understand what it is all about and what are the things that affect it.

Unfortunately, people commonly have a lot of misinformation and misunderstandings about their credit score. Here are five of the most common credit score myths and along with it the true facts:

MYTH #1: The major bureaus use different formulas for calculating your credit score.

FACT: The three major credit bureaus - Equifax, TransUnion and Experian -- give the score a different name. Equifax calls their score the "Beacon" credit score, Transunion calls it "Empirica" and Experian gives it the name "Experian/Fair Isaac Risk Model." They all use different names for the credit score, but they all use the same formula to come up with it.

The reason that the credit score you receive from each bureau is different is because the information in your file that they base the score on is different. For example,the records that one bureau is using may go back a longer period of time, or a previous lender may have shared its information with only one of the bureaus and not the other two.

Usually the scores are not too far from each other. Unless there is a big difference between what each bureau says is your credit score, many lenders will just use the one in the middle for the purpose of analyzing your application. So, for this reason alone it is a good idea to correct any errors that exist in each of the three major credit bureaus.

MYTH #2: Paying off your debts is all you need to do to immediately repair your credit score.

FACT: Your credit score is mostly determined by your past performance more than your current amount of debt. It will definitely be very helpful to pay off your credit cards and settle any outstanding loans, but if yours is a history of late or missed payments, it won’t remove the damage overnight. It takes time to repair your credit score.

So definitely pay down your debts. But it is equally important to consistently get in the habit of paying your bills on time.

MYTH #3: Closing old accounts will boost my credit score.

FACT: This is a common misconception. It's not closing accounts that affects your credit score, it's opening them. Closing accounts can never help your credit score, and may actually hurt it. Yes, having too many open accounts does hurt your score. But once the accounts have been opened,the damage has already been done. Shutting the account doesn’t repair it and it may actually make things worse.

The credit score is affected by the difference between the credit that is available and the credit that is being used. Shutting down accounts reduces the amount of total credit available and when compared with how much credit you can use your actual credit balances are made to seem larger. This hurts your credit score.

The credit score also looks at the length of your credit history. Shutting older accounts removes old history and can make your credit history look younger than it actually is. This also can hurt your score.

You generally shouldn't close accounts unless a lender specifically asks you to do so as a condition for them giving you a loan. Instead,the best thing you can do is just pay down your existing credit card debt. That's something that definitely would improve your credit score.

MYTH #4: Shopping around for a loan will hurt my credit score.

FACT: When a lender makes an inquiry about your credit, your score could drop up to five points. Some borrowers think that if they shop around by going to a number of different lenders that each time a lender does an inquiry it will generate another reduction in the credit score. This isn’t true. For credit score purposes, multiple inquiries for a loan are treated as a single inquiry, as long as they all come within a 45 day period. So it is best to do your rate shopping within this 45 day window.

MYTH #5: Companies can fix my credit score for a fee.

FACT: If the credit bureaus have accurate information, there’s nothing that can be done to quickly improve your score if in fact you have a history of not handling your debts well. The only way to have an effect on your credit score is to show that you can manage your debts in the future.

Also,if there are errors in your file, you can contact the bureau yourself. You don’t need to pay someone else to do it. Each of the major credit bureaus has a website which clearly explains what you need to do to correct an error.


So, the best ways to improve your credit score are: pay down the debt,pay your bills on time, correct existing errors on your credit reports in each of the three bureaus and apply for credit infrequently.

10 Tips To Improve Your Credit Score

These days most of us avail loans to buy a house, set up a business, or buy a car. Many students take loans to further their education. How soon the loan is sanctioned, the rate of interest, and the amount sanctioned will all depend on your credit score which is based on your credit report. People with scores of 700 and more are the beneficiaries of lower interest rates and quick sanctions. Imagine if your score is greater than 700 and another person has a score of 698 then the person with score 698 will have to pay interest that is higher by one-half percentage point. And, this means over a year a person with a lower score will pay USD 19,000 and more as interest on a loan of say USD 165,000.

A credit score takes into consideration: payment history, current earnings, current debt, length of credit history, types of credit utilized, and your new credit. If two or more members of your family are earning then apply for a loan jointly.

You can take a few simple steps and ensure that your credit score is higher than 700.

•    Maintain a long healthy credit history. Keep alive your oldest credit card and be sure to pay all bills in time. Never keep bills pending over a 30 day period. If in a crunch at least pay the minimum charges due.

•    Do not have too many credit cards. Learn to say “NO,” to offers of free credit cards. And, maintain a good credit limit. Avoid using all the available credit on the cards.

•    Ensure that the credit report you have is accurate and that there are no errors clerical or otherwise.

•    Plan your finance such that it is healthy. Consider debt consolidation.

•    Never suddenly close or open accounts. This leads to suspicion that you are trying to manipulate your credit report.

•    If you are having problems speak to your creditors well in advance and work out a stage wise repayment. Request the creditor to refrain from reporting the late payment.

•    Late or delayed payments drive your score down so always pay bills dead on time. Keep a tab on due dates and ensure that all bills are paid.



Learn all you can about credit reports and scores and keep the criteria in mind while managing your finances. Maintain the debt-to-credit limit ratio and, if need be take the help of a finance planner.  A useful source to learn about managing credit is: balancepro /services/index.html they provide in depth coverage on money management, debt management, and credit report review.

Even if advised refrain from filing for bankruptcy. All you need to do is to sit down and curtail expenses, plan you income-expenditure , and avoid spending what you have not earned.