Archive for the ‘Credit Score’ Category

Crumbling Credit Score and my Family Life – The pressure is mounting!

Tuesday, April 27th, 2010

Did you know that your bad credit can affect your family life in ways imaginable? Some people think that having bad credit can only have a negative affect if they apply for credit or from obtaining better loan deals and interest rates, but in an article written by Liz Pulliam Weston on MSN Money, shows that bad credit can also cost you a job.

According to Liz Pulliam, A fair chunk of employers want to examine your credit history before offering you a position or a promotion. Blotches there — repossessions, collections, high credit card balances — could cost you the job you want. For example, applicants for Transportation Security Administration airport screener jobs are rejected if they have more than $5,000 in overdue debt. Liz also stated that, many companies do use credit histories as a way to weed through job candidates. In the private sector, the people most likely to have their credit reviewed are those who will deal with cash or valuables, or who are financial executives, said Greenblatt, a labor attorney with more than 30 years’ experience in employee testing and screening.

“Bank tellers, CFOs (chief financial officers), controllers, people who work for brokerage institutions, financial institutions,” he said. “Jewelry manufacturers do credit checks. . . . When you’re dealing with diamonds, they’re easily concealed (and stolen).”

Crumbling Credit Score and my Family Life

Keeping Your Credit Score High

The number one most damaging thing to your credit score is bankruptcy with the least damaging is a maxed-out credit card. Depending on your initial score, a late payment can lower your score by 60 to 110 points. If you have a foreclosure on your record this can drop your score by 85 to 160 points and debt settlement can cause a drop in your score of 45 to 125 points. Overall, any significant drop in your credit score is not good for obtaining credit because lenders use these scores to determine your credit worthiness and the higher your score the better off you will be in qualifying for a loan as well as getting a favorable interest rate and other terms and conditions on the loan.

Determining a Borrower’s Credit Worthiness

Lenders also use other factors in determining your credit worthiness, such as:

The total amount of debt you have in comparison to your income.
How long you’ve been employed at your current job.
The amount of savings you have.

In-order to reestablish your good credit you will need to use credit, however use it wisely and only for emergency purposes and most importantly pay your bills on time and do not exceed the credit limit. By doing these simple things, you can regain your once flawless credit history and put your family life back on track to a better financial future.

Tags: Bad Credit, Credit Score
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How to Improve your Credit Score REAL FAST?

Thursday, March 18th, 2010

The race goes on to find ways of reducing debt and increasing our credit scores. This illusive feeling of being debt free has grown to be big business and financial professionals now charge individuals to give them advice of how to increase their credit score. Here we will break this mold and divulge some of the secrets that we hope will help in improving your credit score.

Pay down the Credit Cards: An effort to pay down your credit card gives an indication that you are willing to manage your debt. Although you may not clear your credit card debts, it does wonders to your credit score. Lenders are happy to see a huge gap between the amount of credit you use and your credit limit. A good ball-park figure is to maintain your credit balance below 30% of the credit limit. Therefore, while some analyst will suggest getting rid of the credit card with the highest interest rate, surveys of credit card lenders say if you want an accelerated increase in your credit score, it is best to pay down the credit cards that are closest to their credit limits.

Regulate your Credit Card Use: The rate at which you use your credit card affect you credit score significantly. Making emergency withdrawals from ATM machine and frequent shopping send the credit score through the roof. Even if you pay off your balance in full each month, the credit score is calculated the balance of the last reported or your last statement. Now we are not saying that paying off your credit card monthly, actually, that is a great positive practice. However, by regulating your credit card use helps to improve your credit score real fast.

Use Old Card Every Now and Again: Even though we may stop using old credit cards, it is not wise to cancel them totally. Every six months or so use them to prevent your creditor from putting it on the list of dormant accounts. Have a credit card over an extended period show a huge amount of stability in the credit card system. As a result, this record is fed into the general system when calculating your credit score and improves your credit score exponentially.

Increase your limit: A word of caution here. If increasing your credit will trigger you to go on a spending spree, then this one is not for you. This is for individuals who have a lid on things and are managing the use of their credit card. Increasing your credit limit actually gives you more room between your outstanding balance and the principal. Now, for this to work, you must maintain your credit balance below the 30% of principal mark and then just enjoy watching your credit score flying through the roof.

Do not ruin a good thing: It is said if something is not broken, then do not fix it. If you already have a good credit score and good management of your credit card spending, then this is enough to give you a high credit rating. Continue implementing you control mechanism and do not play around with new ideas that may get you into problems.

Tags: Credit Card, Credit Cards, Credit Score
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Credit Reports Made Easy

Thursday, March 4th, 2010

More often than normal the problem is precisely not about understanding your credit report, but understanding the implications of various transactions on your credit score. A periodical review is sure to help you get rid of any discrepancies in the report and also the impact of transactions.

How can I understand my credit report?

Understanding the implications in your credit report is no great deal. We have made an effort to tabulate the events and the resultant impact on your credit report.

S.No	Issue	Impact on Credit Report
1	Credit Score Ranking	Check out the ranking and know where you figure High Risk 330-550 High Risk – Medium 551-625 Medium Risk 626-699 Low Risk – Medium 700-725 Low Risk 726-830
2	Availing maximum credit on cards	It is ideal to maintain your credit usage at around 50 % to avoid huge impact on your credit score
3	Credit score was reduced by around 20 points soon after a home loan was applied for. Why?	A difference of twenty points could be because of a different credit score model used by the lender. You should be careful when there is a difference of around 100 points in your credit score
4	Will the change in credit report be informed to lenders?	Say, your credit was rejected and thanks to your efforts, the report has been rectified, on your request, the credit reporting agencies can send across the ‘Notice of Result’ to all the lenders who happen to check your credit report
5	Who else will refer to my credit report apart from the lenders?	Employers and insurance companies will refer to your credit scores in addition to lenders.
6	Will lenders know about my employment status from my credit report?	Credit report will have no information on your employment and related details.
7	Does everyone look for the same information in my credit report?	It depends on the type of loan you have applied for. Every lender would like to know if you can afford to pay the loan you have applied for
8	Checking my credit report too often cause any trouble?	Not at all. Your checking has no relevance, credit report request from companies are certainly viewed seriously, when they exceed a certain number of times
9	What items are excluded from my credit report?	No information as such need be excluded from your credit reporting. Except for the credit report request made by lender all other requests especially those from employers and from you will not be reflected in your report
10	Do doctor’s unpaid bills get reflected in my credit report	Any amount due is a liability what if it is a medical bill? All liabilities get reflected in your report
11	Will co signing a loan application affect my credit score?	It certainly will. The amount will get reflected as a liability in your account. You better not do it as it will reduce your affordability for other loans
12	In order to offer pre approved credit cards, companies often check into the individual’s credit report. Do these affect my credit report?	Certainly not, any credit request presented without your consent will not be counted and reflected.
13	On getting married, will the credit score of my spouse affect my credit score?	No. Each of your credit reports are tracked through your social security number and the creditworthiness of your spouse has nothing to do with yours
14	I am unnecessarily being troubled by pre approved credit cards and insurances. How can I avoid their access to my credit report?	All you need to do is inform all the credit reporting agencies not to provide these companies with your credit details. You can call up 1 888 5OPTOUT (1-888-567-8688) to inform the same
15	I would like to close some of my credit cards. Which are the ones to be closed?	Where you opt to close your credit cards kindly remember the following Choose retail cards to bank cards Choose cards with lower credit limits Do not surrender cards you had been holding for long
16	I had a divorce, should I inform the credit bureau?	You should. Furnish the new address and the fact that your spouses credit details should not be furnished along with yours
17	There is an error in my credit report. How do I rectify?	Call up the respective credit reporting agency and send a letter stating the mistake and proof of credit report. When the same has been resolved with the creditor, the credit report will be accordingly rectified.
18	Can I add favorable items to my credit report?	You certainly can. You can repair your credit account by adding some of those positive items, and yes you will charged for that by the credit reporting agency
19	Does a credit bureau decide the sanction of loan?	No. Their duty stops with just providing the information and the decision part is left to lending companies
20	How do I know the status of my credit report?	All you need to do is call one of the credit reporting agencies and get a copy of your credit report
21	Which are the three credit reporting agencies in the US?	There three credit reporting agencies in the US they are TransUnion Equifax Experian
22	What is a credit report fee?	Credit report fee is charged by the lender on a loan application. It costs around $25 to $50. This charge is incurred to get a copy of the credit report of the applicant
23	I should a get free credit report every year. Do I get one from each credit reporting agency?	Yes, you totally get three free credit reports each year
24	Will credit counseling taken by me reflect on y credit report?	Yes does reflect. It is not a bad thing in your report, as getting credit counseling is better than not paying loan installments
25	Is there some way I can know that someone is trying steal my identity?	If you find transactions you never made in your credit report or you get a call for payment of something you never purchased or availed, you will know that someone is trying to steal your identity
26	Investigative Credit Report. What is this?	If required under the federal law a credit reporting agency may conduct a detailed investigation on your credit report, even enquiring your friends, neighbors and associates. The agency should inform you before proceeding to investigate
27	What are these credit repair agencies?	Often credit reporting agencies claim to clean your credit report, which they normally do not. Hence it is advisable not to go for it, instead see what best you can do
28	I have too many cards and I want to close them. Is there a problem?	The problem is not when you don’t pay, but when you apply. By closing these cards the ratio of debt to credit reduces affecting your credit score. It is better you pay down the loans and not use them any more
29	While shopping for mortgage loans, there might be many credit enquiries? Will it affect my credit score?	No, multiple enquires over a 45 day period is considered 1 by FICO regulations. Hence go shopping peacefully
30	How to ensure no identity theft happens?	As soon you spot a discrepancy report the same to the reporting agencies and along a police complaint if required and make sure your complaint is rectified in time. Keep track of your credit report as often as possible.