Tuesday, December 29, 2020

You will need to write a letter to your creditor and advise them that you are disputing a charge on your account. You will need to state why you are disputing the charge, and what you are trying to get from them. Be sure to provide a copy of your credit report, and let them know that you are a consumer, not a collector, making this dispute. Ask that the charge be verified and removed from your account. Let them know that you need your credit report to be correct because the charge will appear again for another creditor to take on it. Let them know that the charge is not yours, and ask them for their help in getting it removed from your credit report. They can copy and mail instructions to have the certain information corrected on your credit report.

Let them know that you will contact them in writing, and make certain that you send the letter Certified Mail, Return Receipt Requested. This means that you have a written paper trail that can prove that you contacted the creditor about the disputed charge, and they received the dispute. The credit reporting agencies are now required by law to remove the disputed item from your report. To ensure that it will go in quickly, ask them to please send the letter to the original creditor, and make certain that you have your paper trail.

If you ask that an account be corrected, the creditor also needs to investigate any disputed accounts and report back to the bureau. Some creditors report the account as closed as they obtained from the debtor, so have the creditor report back to the bureau that the account was in dispute, and the creditor found it was in dispute. Then they will have to report that information back to the bureaus. As long as your account is in dispute, then you can see a credit card be listed as being in dispute. However, if your account is not in dispute, then the creditor may not report the account as not being in dispute. It is up to you to decide which you wish. Emphasize the fact that the creditor does not have to report anything and then if there is any disputed information showing that you as the debtor in question did not pay one bill, the account should be deleted from your report.

It is also important to note, that US law requires credit reports by law to include your most recent information. The credit reporting agencies are required to take this into consideration when release their credit reports. If you have a closed account on your report and your derogatory account stay on your report for 10 years. However, the information about the closed account will stick around for 7 years. If you do not have a bill account in dispute, if it is closed 7 years or older, then it should show as being "closed". However information about an open account can sometimes show up on your credit report even though it is not in dispute for as long as it is reported for more than 7 years.

When it comes to cell phones, land lines, emails and subscriptions, do not be so quick to pull your credit report. It is very easy to get stuck with fees, and misunderstandings. On an account which is in collection, it is important that they notify the credit bureaus about the account.

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There are two basic approaches for credit repair. One is the do-it-yourself method and the other is hiring an expert. You might think you know everything you need to know about credit repair and where to start and where to stop. But at the end of the day, nothing will have been done for you unless you have the guts to go for it. For the do-it-yourself technique, the usual information you might need (apart from your credit report, which is the key to start credit repair) will be: your credit card account history, the outstanding balance over the past six months, the types of accounts involved, and the number of inquiries from creditors or credit providers in the past two years. In order to have the most effective results, you need to get all this information from multiple credit providers and credit card issuers, as it will help you to streamline your efforts. The second approach to credit repair involves working with a qualified professional. That means looking for a firm or lawyer that specializes in fixing credit problems. In general, this kind of credit repair consists of the following steps:  

  1. At the very least, knowing where you stand financially
  2. Creating a budget
  3. Learning the strategies and tactics to erase your debts

You might have become aware that your credit is bad and you have a lot of debt to settle before you can get on with your credit repair. So, how can you go about with do-it-yourself credit repair? Here are the basics of a do-it-yourself credit repair - creating you own budget, creating a debt management plan, learning strategies to erase your debts, and knowing how you can stop creating more debts. The most important strategy is to first of all, stop increasing your debts. If you are the type of person that can't resist buying stuff even though you know you don't need it, this approach isn't for you because you will be babbling to yourself and doing damage to your credit score in the long run. The other strategy is not to pay any and every bill, including medical bills, which is not a particularly wise idea if you have no money left for some things after paying for your necessities. The strategy of credit repair is not greatly affected by the actual length of time the bills were overdue or the number of times you were late. However, the most important factor is the extent that you were able to damage your credit score. That's because the absolute fastest way to do a lot of damage to your credit score is to pay medical bills or stop paying your other bills. I'm sure everyone knows people who have been trying for months to repair their credit score whose major credit card companies have refused to reduce the minimum balance on their bills.

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Monday, December 28, 2020

We all know that good credit is important, but most people struggle from time to time with too much debt, loss of income, or other financial emergencies. Collection agencies start entering the picture when payments are late or incomplete. People often file bankruptcy hoping for a new start, only to find their future credit is negatively affected for seven or more years. Understanding how to repair your credit is a far better alternative emotionally and financially.

Credit reports and scores determine such things as: 

  • What kind of loans you can qualify for
  • What interest rates you can afford
  • Whether or not you will be hired for a job, promoted, or get a loan, a credit card, an apartment, or in some cases a home
By having a better credit score you can save money by getting lower interest loans. Lower interest loans can save you hundreds of dollars each year. Think about this. If you could save $400 each month for 30 years, what would you do with that money? Pay your bills? Get out of debt? Repair your home? Because our credit score is our lifeblood, by repairing our credit we can save money and protect it. We need a good credit score for everything from getting a loan to mortgage to buying a house, car, and education. There are simple steps to take to make sure our credit report is accurate.

Although having good credit is important to our financial future, today more than ever it is more important than ever. With credit card companies relaxing their requirements and making it easier and cheaper to get credit, it is now more important than ever to have a good credit score. Even people with the best credit are paying, on average, 20% more on a mortgage with less than perfect credit. If your credit score is low and you need to get a mortgage, they will look at your credit score. If you have a blemish of any kind, even a few late payments, your score will be pulled. If your credit score is low, you are less likely to get access to credit, lower credit card limits, and even affect your job and even work performance.

If you have a low credit score you need to repair it. The first thing to do is order your credit report. By law you are entitled to one free credit report every twelve months. You can also order your credit report through a third party if you so choose. Look for items on your report that do not belong to you. If you have been reported for something and you know it is not yours, dispute it by writing a letter explaining what is on your report. By law the burden of proof is on the credit reporting agency and they need to prove the item is valid. They have thirty days from the day they receive your dispute to prove it's validity. If they fail to prove it's validity, or do not remove it from your report, by law you can be protected. The next step is making a list of all the problems on your report. Then, together with a good friend of mine who is knowledgeable in this process (he actually uses this information for his real estate transactions) we take some mock letters and approach the credit card companies and banks to dispute the items we want to dispute. Once we have the information we need to challenge the bad credit, we challenge the item with a fresh letter. It's really that simple. Now we have someone else to challenge. After your credit report gets pulled another credit report will come out with the information we found on the first report. This time we have our company challenge it with this new information and hopefully get it removed or corrected. At this point if we are really lucky we have made some progress. If we get the information deleted, our credit score goes up. If the information is corrected or corrected we score some more. The amount of improvement depends on how bad the past problems were vs the new report. If we had messed up once, that might only get us a few points, but if we get the information corrected and re-reported, we possibly can up our score easily 20-30 points.

Removing incorrect information from your credit reports, whether correcting your name, correcting your address, or deleting inaccurate information will benefit you greatly. It is even possible to dispute incorrect information on your credit report and have that information removed.

FICO scores are calculated based on information on your credit report. As loners, those with longer credit histories are substantially more likely to remain stable in their payment of bills. The FICO score is a cumulative score based on the payment history or credit data of a person, ranging from a low score of 300 to a high score of 850. The majority of prospective lenders use FICO scores to calculate the risk of lending to potential borrowers. Although the average American has a credit score of around 675, the score of 680 or higher is considered good, while a score of 535 means the applicant is very likely to default on the loan. The risk of lending to applicants with lower scores is substantially less.

Knowing how to read your credit report, once every 12 months, will give you valuable insight into what is being reported by your lenders. If you find inaccurate information about your credit report, contact the credit reporting agency immediately, discussing your findings with them directly and requesting that they correct the information in the credit report. To add to the best of their efforts, ask them to send a written notice to the credit reporting agency, instructing them to delete the incorrect information. Can you convince them that you don't owe the money, or that the debt is not yours? If the collection company or creditor can not provide legal proof to back up their claim, they must remove the account. The easiest way to find out if you actually owe the debt, is to ask the creditor to send you proof. If they cannot provide this information, they must investigate your claim and remove the account from your file. If the creditor can not provide that proof, your next step is to write them a letter and request that they correct the inaccurate information and provide you with their findings. Send copies of the proof that you requested them to provide you with as well. Send this letter through certified mail with a return receipt request. Keep a copy of the letter for your records, and send copies of your certified mail receipt to the FTC. They are required to investigate the situation and reply within 90 days. If the creditor does not reply within 90 days, you must write another letter. If they do not reply within 30 days, the FTC can take action against the creditor. Once the investigation is complete, they are required to provide you with the results, in writing. This written report must tell you whether or not the creditor deleted information that should be on your credit report, or whether the creditor has verified the information, and if they did indeed correct the inaccurate information. The written report must also tell you if there are any changes you need to make to your report. These changes may include spouse, or references that were not included in the original report. If your report changes, the creditor is also required to notify you of these changes.

There is nothing wrong, or illegal about this, as you have the right to know how your credit is reported and what information is on your report. If you find errors that are inaccurate, you can write to the credit reporting agency with the error, asking them to correct it and send you a copy of the corrected report. Since credit reports change often and some information, such as your account number, may not be the same twice, you may need to contact all three credit reporting agencies.

This is not going to be a very quick process; you may have to write or fill out forms and mail them by regular mail or email to the credit reporting agency. Your credit reports will contain the same information listed, relative to your FICO score, as your credit reports do for credit you have already requested. However, if there is a difference you have to dispute any errors, regardless of who supplied that information.

Be careful applying for new business credit accounts. Too many inquiries can have a negative effect on your credit report, so if you are looking for credit lines, don’t be tempted by companies that offer account guarantees. They are exaggerating on both of those counts. A flat-out no credit check type of arrangement is the worst type of credit arrangement you can run into since it allows for lenders to check on all manner of financial information on your company and your company's officers and directors.

Interest rates can vary depending on the type of account, credit history, credit score, and the amount of collateral asset used. The value of collateral will determine the interest rate on an account, with the amount of collateral a primary determining factor. Collateral can include things like inventory, equipment, vehicles, inventory-backed accounts receivable, and personal guarantees. If you are having trouble securing new business credit, or you just need to improve the effectiveness of your existing business credit, consider the possibility of using your company's cash on collateral as a means of simple bank financing.

A company cannot conduct any business without a system of recording business transactions. As the current economy has shown us, paper can be of great value, but it can be a bad thing too, especially when it is fraudulent. Credibility is one of the most valuable assets a company can have, but a lack of it can kill a company's credit. Your company’s credit rating is directly impacted by the integrity of your records. All of the data you enter into your business credit profile will be examined for discrepancies. As an example, if you miss an application for credit and your company’s records show that it was a miss, you could be denied a loan. Too many contacts you have does not mean you are bad at your business, and it does not mean that an account is open or not. It means that somewhere in the system there may be a problem that needs to be addressed. If the credit process was transparent and faceless, this would not be the case. It is very important to state that for every action that impacts your credit report negatively, there is an equal number of positives. The world of financing is very competitive and shifting, so make sure you set up systems and employees that can support you in this journey. Create manageable, well-tested systems, and hire qualified people to implement them. Don’t try to be all things to all people. Remember, entrepreneurs should have an internal culture that supports the success of their business without cutting into personal time or finances. Make sure you have financial guidance and support without leaving the home front. Interestingly, having the support of family and close friends looks much better in the long run than having a corporate business phone bank calling at the drop of a hat.

Get your corporate credit in order, build solid systems, and find competent people to implement them. It is possible to secure corporate credit and then implement that credit through an efficient process that is well supported and monitored internally. Consider investing in the systems and people that will make your business credit report a success.

Tuesday, December 22, 2020

Usually, a business credit report costs around $20. It includes everything that the business that is being offered credit. It indicates the creditworthiness of the business, and it provides lenders with the sales records in addition to and as an addition to the credit reports that are on file for them, although they sometimes show up as references on other credit reports.

A business's credit report is a history. It is basically the record of how a company has had a good or bad credit experience with other credit suppliers and fulfilled their rental, commercial, or manufacturing obligations. Businesses that have no records provide a hindrance to completion of new business relationships. It is another word for a trade credit report. It is compiled every time a company extends credit as part of completing a transaction. Sometimes these transactions are trade and purchase. That is, if a company sells something to another company that they buy partly from them. However, these purchases are usually very small, and it is contractors that make them. People to whom equipment and materials are provided are the suppliers of these dealings. After the initial transactions are done, the trade credit is recorded for that company by a trade credit bureau. Advance rent reports or rent changes are the most common form of trade credit. Under this arrangement, an enterprise will extend credit to an enterprise or host a supplier to whom the supplier provides part of the goods. For example, a company may sell to a large subcontractor or vendor that provides the goods to them in stages. The subcontractor provides up to eighty percent of the goods. The company provides the rest. Under the terms of the arrangement, the client company reports the trade references for each of its subcontractors each quarter. In the example above, the company would owe its subcontractor credit for each quarter the subcontractor provides them ten percent of whatever they receive from the client company. At the end of the quarter, each subcontractor would receive their ten percent in payments from the company. The trade credit report for each subcontractor would show how much they owe the client company, and who they owe it to, and the method by which the payments are made. The trade credit report also provides a record of how payments are made on the outstanding credit that is extended to a company. After a transaction is completed, every credit reference in the trade credit report indicates whether or not the transaction was successfully, or is still in process. If a company extends credit to another company, and the other company fails to make payments on the credit, it will appear in the trade credit report as well.

All of the trade credit reports in a company show the credit score, with a implying scale that ranges from 81 to 100, with an overall score of 120 being the highest possible score. An overall rating of six hundred and twenty-eight will be an excellent score. A company with an overall rate of four hundred and thirty is considered satisfactory. These are the establish standards that companies use. The exact score by each credit bureau is different because each uses different algorithms. If a trade credit report indicates that a company has a credit score of ninety, that firms will usually get an incredible amount of credit, but that the trade credit bureaus low down the interest rates and zero out the balances with processing fees. Even if a company has a credit score of just five, and thus a major advantage, they can still receive tons of credit, but the interest rates would be sky-high.

Monday, December 21, 2020

Although many conventional credit experts say you should maximize your credit limits, doing that could hurt rather than improve your credit history. Credit experts recommend that you should keep your balance below 40% of the credit limit on your cards. That means if you have a $15,000 credit limit, you should keep your balance below $2,000. A possible exception could be if the card you are transferring a balance from has a higher interest rate. Most cards today have some sort of balance transfer option. If you prefer to keep a card and its balance unpaid, there are several different ways you could do so. However, if you enjoy transferring balances, then you should immediately pay down your credit card balance before you close the account.  If you are worried about closing your account early, then it’s a good idea to only have one card with a balance. This way you won’t be tempted to spend several years paying the balance. In some cases, you may be tempted to open new credit card accounts once you transfer a balance from a higher interest rate card. If you are looking to open credit card accounts and don’t have to close your old cards, then you could find yourself in a position where you have too much credit available and close some of the accounts to accommodate the new accounts. If you close the accounts, you lose all of the built up credit.

In an ideal situation, after the transfer is completed, you should continue to pay your bills every month on time. If you can pay them before the due date, do so. Once you pay on time for six months or more, then you can begin to take out credit and your utilization rate must be lower.  That means your utilization must be lower than 40% of your available credit. Another possible scenario may occur after you transfer your balance. A new card issuer may put a freeze on your account that prevents you from applying for any new credit. While this is rare, it does show up when you have too many accounts linked to your name. You should be aware that one inquiry will keep your credit report from being looked at again, even if you don’t apply for new credit. However, opening up new credit cards often raises your credit utilization, so trying to open a new card may be seen as a wasted effort.

This is probably not as serious as it seems, but as with anything financial you must be careful. If you make some small charges every now and again, then you should be able to pay for them before the item goes to collection. Receiving a collection letter does hurt your credit score. Processing this in a timely fashion may make a better workout for you.

Credit cards can be a good thing if they are used properly. However, if you fill out the application and are not responsible, then you will receive the credit card™s bad habits and you will pay for it with high interest and fees.

Sunday, December 20, 2020

Get a business loan and pay attention. Admittedly, businesses do not need a bank loan to begin their buying and selling activity. Although banks do not give the same rates to business as they do to residential mortgage holders, they provide business with a solid collateral base. The bank will always protect its principal balance. Since individuals or companies will not always have the money to pay off their loan at the start of the contract, they will work with the borrower for a fixed period to collect as much interest as they possibly can. As a business owner, you need to pay attention because that is how you are going to be contended with.

Remember to buy just what you need. Be sure to buy from your own funds. If you do decide to refinance your business, add that cash to your business funds. Assure that the card has the same incentives as if it was your own card. Look for all the available rewards available with the card, such as airline rewards. There is a distinction between a business card and a personal card, which is generally interpreted as a charge card will allow you to more easily track expenses and also set limits for yourself and for your employees. You should also look at the various finance packages. Typically, it is best to find a creditor who has the best interest of your bottom line in mind.

Take control of your finances and insurance. Take advantage of the debit card rewards. Rewards cards will pay you interest on your expenses and free you up to spend in the way that you know is right. Since debit cards are more convenient, you can use them without unnecessarily running the red bolster. As with the card company, it is best to buy only what your business truly needs. For example, your business might be opening an office in Hong Kong or London, but you want to consider the fact that you will not be able to access your working funds and have to pay out of your pocket. It is best to opt for a business card that allows you to purchase supplies in any location across the globe and also lets you add rewards on supplies that you purchase using the card, as well as bonus points for certain types of expenses incurred.

Data can be garnered by the monthly statement for your cards. Another thing to look for is the rewards that are being offered. Look for qualification requirements and associate yourself with a company that is offering an worthy rewards package. If you find that it's one of the company's programs are offering you free air miles for the items that you spend money on such as business travel, say you fly frequently to the Caribbean on a business trip it would make sense to instead use a rewards card that provides miles that can be redeemed with air miles to travel to include a Caribbean vacation. One company processing credit cards offers rewards that have rebates for purchases made at gas stations and restaurants. These rebates can add up to fifteen cents on a dollar, which can result in a fifteen percent savings at a particular place of the price. "A" level programs that offer the best buys for the items that you buy most often will also offer you access to the rewards. Access to them can save you the trouble of having to go through the lengthy process of filling out and mailing in stamps. This can mean that you can spend your money elsewhere, so you make the purchase, because you're saving on postage costs.

Give your employees the proper financial protection with credit card limits and spending agreements. Some cards add a spending limit to card holders. For example, you might have a credit limit of one thousand five hundred dollars, but it will have a limit on how many times you spend that limit. If you go over that limit, say for whatever reason you just might have to pay a fee since the card issuer reserves the right to change the credit limit at any time. These kinds credit card limits are very attractive. They can serve as a fantastic savings program, especially for a small business. Counting on great rewards, like travel rewards with many cards, can help a business to save lots of money.

Thursday, December 17, 2020

Fortunately, it's possible to improve the credit score that you hold by using your business credit card in a responsible way. Doing so may necessitate that you make regular payments. By ensuring that you have the budget to make payments about the go, you can be sure that your credit will improve over time. Of course, in the best case scenario, you will be able to use the business's credit card to improve your personal credit score as well. By looking at the individual application for the credit card and understanding what you are required to do on it, you can see that there are some steps you can take to improve the credit rating. Paying on time should always be a top priority in this department. Maintaining on time payments will help your credit score over time.

There is a lot of information on the internet that can help you to understand how to establish credit for your business. For example, you may want to have a credit card in your company's name rather than in your own name. This will help to establish the credit rating. If you are using your personal credit card for your business, this could also cause financial problems. To establish yourself as a business, you may want to make sure that the credit card that you obtain for your company's use is secure. Many people are worried about online purchases, especially with a secured credit card. By knowing where you are getting your credit, it can be easier for you to accept credit cards if there is fraudulent activity. Check with your bank or other lenders to see what they are doing and how they deal with paid merchants. In this way, it is easier to process payments from business merchants. Lastly, using a business credit card to improve your personal credit is great. Many small business owners are making use of their personal credit to back up their business expenses. The problem is that this can have a negative impact if you do not pay your monthly statements on time. The next time you apply for a loan or credit card, see if you are applying for an unsecured card first. If you can get this type, it may be beneficial to do so.

It is a challenge to establish credit, but it can be done if you are willing to do the work it takes. Make sure that you have all the facts and make sure that you make payments on time.

Wednesday, December 16, 2020

Once you have made a decision to retire, you are likely already semi-retired or semi-employed, with a poor credit history. You have withdrawn from your savings plan and are probably paying high interest on a debt load. If you have been late on your payments, your creditors may report delinquencies to the credit reporting agencies. Late payments remain on your credit report for seven years.

Disciplines on your way to retirement

You can avoid the problems with your credit score by making regular savings and sticking to your personal budget. Pull your credit report one time at the close of each year and make sure that your information is accurate. If there are any discrepancies, contact the credit reporting agency with the discrepancies. You may need to show proof from those who they did not report to. If you have the time to wait, save your credit reports as well as your financial documents. Keeping a watchful eye on your finances will help avoid missed payments. Your strategy should include having a system in place that allows you to write checks for monthly bills, automatically. If you combine the two methods you have a safety net for missing a payment.

Beyond that, the limit is key

Keep your debt to income ratio at a minimum. This means that you should not have more than 35% of your pay check in regards to what you owe on your credit card and other bills. If your debt is too high, you may not be able to keep paying any of your other bills. If you have your debt too high, you may have to consider talking to a debt management agency in order to establish some alternate payment arrangements. In order for you to make sure that you are only making payments that you can afford, a budget detailing each of your payments.

Be aware of your limits

You should be aware of how much you can spend on your credit cards. Do not spend more than the limit that you have established. Credit card companies are less likely to help you with lower balances if you can pay them off quickly. It may be in your best interest to pay them off in full and try to lower your debt as much as you can each month.

Annuity payments

You will not be able to receive the benefits of an annuity until after you reach age 59 ½, but that does not mean that you should not take full advantage of them. Your contributions to them should be enough to cover your retirement income. If you continue to make payments into your annuity, make sure that you use them to lower your debt. Use your plan proceeds as an investment to help manage your other financial considerations. You can never lose by getting a financial plan.

Managing your credit account

Use each of your credit cards to make small purchases and pay the bill in full each month. Never be late on your payments or your credit will be damaged further. If you have one card that has a $2,000 limit, only use $500 to $1000 worth of purchases per month. Keep your balance lower then around 30% of your available credit limit. Make payments on time or early every month to keep your credit score updated. Keep in mind, once your score gets higher you will need to maintain that higher credit score to access more credit. Lenders and credit issuers are aware of the importance of this score, so it is in your best interests to keep your credit score high.

Tuesday, December 15, 2020


You'll need your credit reports from all three credit bureaus: Equifax, Experian, and Trans-union. These three companies operate independently of each other, so it's possible to have three different scores from these companies. The federal government, however, requires all credit bureaus to provide you with a free copy of your credit report once every twelve months. If you're reading this article prior to receiving your free credit reports, then you need to have your reports in hand before you accomplished step one.

One of the easiest ways to get all three copies from all three companies is to request them through each company's website. However, once you've received them you may have to request credit card information through each company in order to get the reports. Some companies will ask for very specific credit card information, such as your account number and expiration date. This is all for your credit protection purposes, and the truth remains that there's no way to get away from these requests once the proper documentation has been completed.

Once you have the credit reports in hand, you need to go through each one carefully and seriously. Ordering them might be the easiest option, or you may prefer to do this in some degree of privacy by compiling the reports on your personal computer instead of on the company website. Either way, carefully going through each report will give you an idea exactly where you stand as far as what you need to do to improve or repair your credit.

Obtain copies of your credit reports by contacting each company in writing or phone. Keep in mind, though, that detailed contact information at each company's website may seem like it could get you in a lot of trouble. Don't be tempted to apply for credit cards through these sites if you don't have the information to handle all the accounts. Also keep in mind that many companies can have inaccurate or dated information, so you'll be required to check through each report carefully.

Once this steps are complete, you must then verify the information on all reports to ensure it's all accurate and genuine. Individuals must only get their free reports once every twelve months, so if you've been hit with various bad luck or confused, check your reports, now's the time to contact each bureau and request that the information be corrected (and any past errors returned for your review). You may have to send checks or money orders. An important note: when you contact a credit bureau, it's always better to have them first-hand. You'll get a quicker answer or description of what they do. In addition, there's a lot of information you're permitted to peruse on each report if you contact the company directly and take advantage of that. Once you've accomplished all of the necessary steps, you can then consider how you can correct or repair your score. It's possible to get a little extra cash or better credit immediately by reorganizing or proving your credit worthiness. Some companies offer this service in particular. If you begin with a fancy chart developed out of a simple spreadsheet, it'll feature no information that doesn't get put into the formula. Some examples of what you might try are: paying down or paying off credit cards, higher trade-in value (if you owe more than you've got), and less-expensive services like home theater or car-buying assistance. In addition to rebuilding your score, you should also reduce debt and pay your bills on time. Be sure not to skip a payment or pay late, and always pay on time and in full. If you're going to get a credit card, be careful and choose one with a high limit but with a lower spending limit. Some experts recommend you only use about 30% of your limit, but be sure not to use more than that and you can be sure to get hit with over-the-limit credit charges. One final, well-established method of improving your credit score is saving up and making bigger purchases. Cut up unused credit cards. If you can't get second chances at cards you don't use, get a big-ticket item (like a new car) that you can afford but may want to save.

Don't expect your credit score to disappear overnight. With determination, thorough record-keeping, and a budget, it's possible to keep track of card balances and improve your credit rating when you want it.

Thursday, December 10, 2020

It is possible to get a car financed and have an almost perfect score. It is less common, however, for one to have a perfect score and no credit history. If somebody has never had a loan or a credit card as a young person, there’s a lot of mileage on their history. Over time, if they make good on the terms of the credit they receive, their credit score will improve dramatically. Therefore, it is a good idea to start to build credit at a young age so that you can greatly improve your credit score in the future.

Another way to enhance your score is through improving the credit utilization rate. Your credit utilization is the percentage of your credit limits that you are currently using. It is critical that you know how to operate the various credit card and charge accounts because the total combined utilization of all of your accounts is a large percentage of your credit score. This means that if you have credit limits of $15,000 on 3 credit cards, your utilization would be $4,500. If you want to be able to finance more, it is necessary to either increase the credit limit on all of the accounts or get a card from a company that will report your credit limits periodically to the credit bureaus. If the combined credit limits on your various credit cards are $10,000, then your credit utilization would be only 15%. It's even more critical that you understand when you have a zero balance on your card that this is compared to the credit limit. You will be penalized significantly.

Another way to add to your score is by paying down the balance on your credit accounts. Make all payments in full and keep your available credit at 70% or below. The closer your credit history is to the zero balance, the better your credit score. It is a good idea to close the account of the cards with no track record because the overall utilization of all accounts on your credit reports is much higher.

Wednesday, December 9, 2020


About 70% of lenders report to the credit bureaus, but they are not obligated to. FICO credit scores are derived from data in the credit reports of the 3 major credit bureaus, Equifax Small Business, Experian Business and TransUnion. Banks may treat other banks as reference points. Both Fair Isaac and its competitors offer credit scoring in addition to the credit reports. The scoring systems are designed to assess risk, and they are routinely subjected to changes as conditions in the economy affect credit. Data from multiple credit reports is weighted in proportions using the information and results are displayed.

FICO, or their competitors, take several factors into consideration when determining credit scores, including the individual's credit history, amounts owed, length of credit history, use of new credit and types of credit used. Banks and credit card companies share in the credit risk of potential borrowers, but all lenders look at the overall score. There are a number of different types of FICO scores. If the score is higher than needed for a lender to make a credit decision, then it is considered to be accurate and will not cause major concern. If the score is too low, the lender will wonder what happened to the information in the report.

For most of us, our scores are not based on a mathematical equation, but rather a set of factors such as payment history, amounts moved from credit, length of credit history, number of new credit lines, number of inquiries, amount of debt on credit lines - known as Chapter 13 or "pay for delete". The number of inquiries, or requests for credit, will affect the score. Bankruptcies, judgments and charge-offs all affect the short-term of the credit report.  If the number of inquiries exceeds a certain number ( trimmed by 10%), the number of credit accounts lowered. Inquiries have no affect on the smoothed average FICO score, and creditors do not report inquires. FICO takes account of length of credit history, new lines of credit and types of credit used. The amount charged on each account is considered in the mixture as well. The length of time since each event is important, especially recent events. The types of accounts on the accounts include credit cards, mortgage, auto loans and installment loans. The number of types of accounts also are important, such as credit cards and retail store accounts.

There are actually a few different types of these financial tools: mutual funds, and annuities, but most lenders consider them unsecured. A home equity line is secured on your home, and credit card companies and banks are willing to extend credit lines that are usually a hundred dollars or so. All other types of accounts are normally closed out by credit agencies. There are specific agencies that deal with finance and credit, yet the nature of the transactions is still difficult for most people just learning about these credit systems.

The FICO algorithm first generates your credit score from a collection of documents that includes the length of time you have had your accounts, current outstanding balances, what type of accounts you have, how long you have had each type of account, what type of mix of accounts you have, and how many credit accounts you have. You will have specific credit limits on credit lines, and those limits are complex based on your credit report. The score also considers whether you pay your bills on time, and when payments are beyond 30 days. High balances on your accounts are a determinant of payment delinquency and an indicator of credit risk related to your use of credit. Credit inquiries affect your score as well. If you have too many inquiries, it could cause the credit agency to reduce your score, but not necessarily as a result of delinquency. Inquiries don't remain on your credit report for more than seven years, except for an installment loan stay on your credit report for 15 years. There are also several public resources and non-profit organizations that offer credit counseling, but if you choose, you can contact a credit counseling service and ask questions to get a road map to your financial future. It is good to work with such organizations. They can explain to you what you can do to control your credit.

Tuesday, December 8, 2020

The first step to repairing your credit is to admit that you have a problem. Don't be ashamed or embarrassed. The truth cannot be denied. Millions of people each year need or want the fresh start that bankruptcy offers; unfortunately they have been led to believe that their situation is the same as that of the person in bankruptcy. Bankruptcy companies often encourage individuals to be more open with them; however, avoid falling for the companies' arguments. They will discourage you from filing bankruptcy by making you feel bad about yourself. Just because they say you have no chance of getting credit right after your bankruptcy, does not mean that you will not be able to get credit in the future.

Under federal law, the three major credit reporting agencies, Equifax, Experian, and TransUnion, are required to provide consumers with a free copy of their credit report seven days after an application for credit has been submitted. All consumers are entitled to a free report every year.

Your FICO score is a numerical representation of your credit history. It is a number that ranges between 300 and 850. The higher your score is, the better your credit. The average American's FICO score is 692. This score is as a general rule as the range may vary among various banks and lenders. If you have a low FICO or your FICO is less than 620 you will most likely not get prime rates on an auto or home loan, but you may be able to obtain a much lower rate by using a co-signor.

Your payment history accounts for 35% of your credit score. It is a big factor, and should not be looked at lightly. The first two years of payments are the most important, as your payment history comprises the largest part of your history. Late payments remain on your report for up to 7 years, and a bankruptcy may remain on your report for up to 10 years. It is not advisable to continuously apply for credit while you are going through a bankruptcy process. Any credit you get will come with a higher interest rate, and if you apply for too much credit, your score will be lower. Your balance used accounts for 30% of your credit score. Carrying a balance is never a good thing as your score is based partially on the amount of credit you have available. It is important to keep your balance below 30% of your credit limit to have a very strong credit rating. Your credit history accounts for 15% of your score. It is important to maintain a long and positive history, and it is for this reason to obtain a home loan and a car loan in your 20s and 30s, since these types of loans have a longer history report. New credit accounts for 10% of your score, while credit inquiries count for up to 10%. It is not recommended to open too many new accounts, as the number of new accounts you open is the second largest portion of your score. The good thing about the different types of inquiries is that they have a short term affect on your credit score, but they have little effect over time.

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