Jon Arnold asked:




If your credit rating isn’t where it should be, the question you need to ask is, “How can I raise my credit score?” Buying a car and it’s insurance rate, acceptance on home loans, a decent interest rate on credits cards, and even getting a good job, or opening a bank account are all parts of having good credit. Many people feel that having good credit isn’t important, if they buy everything with cash. The problem is, sooner or later, everyone needs to depend on credit for something, and good credit can save you a ton of money if you are watching for your future well-being.

FICO provides scores used by two of the three largest credit score providers, TransUnion, and Equifax. Because of using FICO, TransUnion and Equifax are fairly uniform in their data. The other credit score provider, Experian uses the “PLUS” system. Because of the discrepancies among these companies you must constantly be checking to make sure all information is correct. Good FICO scores will rate between 723 to 850, while the “PLUS” system has a good ranking between 501 to 990.

There are many ways to chip away at below average scores.

1. Find a Good Credit Score Site.

There are many credit score sites to choose from, whether it be a one time payment or a site that will provide month to month. There are also sites that will give you a one time accounting for free when trying their service. The service they provide is to watch your credit report and notify you if there are inquiries or any changes that you should be aware of.

2. Check Your Scores and Credit Limits.

First check and see if there are any errors on your credit scores. Errors may include problems that aren’t even yours. This happens much more often than you might believe, especially when using different credit scoring providers. You may be surprised to find settled debts still on your score as well.

3. Pay Down Any Credit Cards.

Use credit cards sparingly and pay them down every month. They may be an easy and convenient way to buy, but you do pay extra for the convenience and it adds up quickly. Remember that, with a good credit score, credit card companies will offer you higher credit limits. Be wary of these as well and only take on what you know you can handle. Do not cancel any credit cards before paying them off. This counts against you on your credit as a surrendered card and will cause a bad credit score. A good rule of thumb, if you must carry a balance, is to pay more than the minimum amount each month, and keep your balance under about 30% of your credit limit.

4. Stay in Contact with Creditors.

Creditors appreciate communication. If you are having problems, let them know and try to work out a payment plan to stop a bad credit report.

Avoiding bad credit is your responsibility, not that of the credit score providers. They do and will make mistakes. Therefore, it is important to check your credit on a regular basis and make sure that if mistakes are made, they do not end up on your report which will make your rating lower than it really should be.

Charlene

Michael Strauss asked:




Your credit score and credit card use are closely intertwined, with both effecting each other profoundly. The way you use your card can affect your credit rating for good or for ill, depending on how responsibly you use it and how prompt your payments are, but in this article we’ll be looking at how things work in the opposite direction, that is how your current credit score influences the kind of credit card you can expect to be approved for.

If you have an excellent credit rating then the whole range of cards on the market is available to you, providing that you meet minimum acceptance criteria such as salary level or residential status. You can expect to achieve a headline grabbing low interest rate, even within the single figure range, and you’ll be showered with extras such as cash back, rewards programs, balance transfer deals, and interest free shopping periods.

These kinds of deals are aimed at the financial elite among the population, and as you’d expect, most of us will have to settle for something a little less luxurious. If you have a decent but not outstanding credit score, with no major black marks such as defaults, then you’ll be able to choose from one of the mid-range cards. These cards will tend to offer generally unexciting features across the range, while boasting one or two stand-out features to attract attention. An example would be a card with a great cash back rate but a fairly high standard APR, or a card with an outstanding balance transfer offer but nothing in the way of rewards or cash back.

As we go further down the range of credit scores, the number of attractive features gets less while the standard APR gets higher. It also becomes harder to be approved, and applications for the cards in the best buy tables become more or less pointless. That’s not to say that there are no decent cards at this level, but you will have to look around a bit harder to find attractive features and low rates.

At the bottom rung of the credit card ladder we have cards specifically aimed at people with poor or no credit ratings. These cards charge extremely high interest rates, often in the region of 30% or even higher, and offer no extra inducements such as balance transfers. They will also tend to have a low credit limit, but with such high rates this is no bad thing – you’d want to avoid running up a debt in any case.

These cards are mainly beneficial for enjoying the convenience of a credit card while using it responsibly to build up a more positive credit profile for future applications for a better card.

If even these specialist cards are out of your reach because of a severely damaged credit rating, then this doesn’t have to mean you can’t carry plastic at all – there’s still the option of a secured or prepaid card which you need to load with funds before you use it. This of course means that they are not actually credit cards at all, but as they can be used in more or less the same way, they have many of the benefits in terms of payment convenience.

Regina

Mike Ziegler asked:




It’s a beautiful sunny Saturday, and you and your loved one are out driving with your realtor. She shows you a house; you immediately fall in love. But in the back of your mind, you worry. Will you be able to get a mortgage for this lovely place? Will the interest rate be too high? Many of your fears can be alleviated by checking and understanding your credit score.

The credit score rating scale is a perplexing numeric equation, and it can be daunting to comprehend. There are plenty of factors that influence the number, and every one of them can change the final result. The more you understand about this concept, the easier it is going to be for you to get the loan or mortgage you desire. Or, you can use this knowledge to make the high-priority repairs needed to repair your credit score faster.

How your credit score is tabulated

There are numerous figures that are reviewed by companies in order for them to form your credit score. They scrutinize your past payment history, how quickly you pay your debts and obligations, and how promptly you pay them. They give much credence to your outstanding obligations. If you are working with too high a debt burden, your credit score can be lowered. Credit agencies study how many years you have had your credit history. If you are newly starting to establish credit, your credit score may be mediocre, even if you do not show any bad points on your credit report.

Two additional significant factors for your credit score

Your latest credit card applications are an additional area that companies will delve into. If you show numerous credit applications on your report, this will be counted negatively on your credit report. You must also be concerned about what types of credit and loans you possess. You do not want to show a lot of overly large balances on your current credit history. These balances, along with higher-than-normal interest rates, are going to go hard on you and lower your number.

What is a good credit score?

Any score that is 700 or higher is counted as a very good score. If you possess a score of 700 or higher, you should see no obstacles to obtaining credit at a exceptional interest rate. A score of 650 and lower definitely has margin for improvement. A score between 650 and 450 needs to be worked on. You are going to most likely have a harder time obtaining a mortgage or any type credit without securing it. This entails that any advance that you apply for is going to require to have substantial amounts of collateral in place to get it. If you show a credit score of 450 or lower, then you desperately need to get some assistance with your credit situation. In that case, it is probable that you can not get any kind of credit or mortgage unless you get some type of counseling to repair your record.

Obtaining the assistance that you require

There is assistance ready for you when you are seeking help to repair your credit score. There are non-profit companies that can assist you with no cost credit counseling. They can propose to you ways to get your credit score increased, and aid you in becoming extra responsible in your monetary decisions. Obtaining this assistance now with your credit situation will get you on the road to recovery faster.

There is hope

If your credit score is low, or if you are turned down for a credit card or loan, do not be discouraged. You can improve the credit score number with diligent effort and some discipline. You can develop a plan to improve your score, then work that plan to make the changes you desire. Do not give up! Others have made changes, and so can you.

Megan

Scott Brown asked:




What are inquiries?

When you apply for credit the creditor or lender checks your credit report to verify that you qualify for the credit or loan you are applying for. The “inquiry” is then reported to the credit bureaus and shows up on your credit report.

Does this affect your credit rating or score?

Yes, it does. Although only a few points are deducted from your score for each inquiry, having multiple inquiries may drop your score to a lower bracket, forcing a higher interest rate. You may not even qualify for the loan or line of credit at all.

Will requesting your credit report generate an inquiry?

This is a common misconception and is totally false. You should view your report at least once a month. Doing so will not generate any inquiries.

What if you did not authorize an inquiry, can you dispute it?

Yes. If you did not authorize any of the inquiries on your credit report you can and should dispute them. To dispute inquiries obtain your credit report, then make a copy of your credit report, highlighting the inquiries in dispute. Finally, send the copy of your highlighted inquiries along with a letter demanding the inquiries be deleted from your credit report to the credit bureau.

Is it worth it?

The next time you are out shopping and the salesperson asks you, “Would you like to apply for our credit line and receive 15% off your purchase?” Ask yourself, “Is it worth it?”

Darrell

W. M. Blake asked:




Anyone who has checked into their credit score has probably found the rating scale to be somewhat confusing. There are a bunch of numbers, each meaning something different. Understanding how this rating works will help you to read your credit score effectively.

There are several pieces of information reviewed by companies when they build your credit score. These factors include the following:

- Your past payment history

- When you pay your bills

- The amount of outstanding debt you have

- The length of your credit history

If you have a great deal of debt or you don’t have a very long credit history, you will receive a lower credit score even if there are no “black marks” against you.

Recent credit applications also factor into your score. If you have made too many applications recently, this will cause you to receive a lower score. As will too much debt at high interest rates, such as high rate credit cards.

A score of 700 or higher is considered a good credit score. At this level, you shouldn’t have any problems getting credit, and at a low rate of interest.

If your score is between 450 and 650, it indicates that your credit needs some work to improve it. At this level you’ll likely have a harder time finding a loan or qualifying for a credit card without some type of security. You will also likely be paying a higher interest rate because you are considered a higher risk.

If your score is below 450, your credit is in need of some serious help. At this level you likely won’t be able to qualify for a loan or credit card until you pursue some form of credit counseling to improve your score.

If your credit score needs improvement, there are a number of sources that can help. There are many credit counseling services available, many of which are free to use. They will be able to assess your financial situation and offer advice as to the best route to improving it – and your credit score along with it.

Margaret

yanks006 asked:


I just financed a new car. My mid credit score was a 627. Will my credit score go up or down from taking on this loan?
By the way I’m 18 months out of Chapter 7 bankruptcy. (Discharged)
I received an 11.9% interest rate with Wachovia. Is that good?

Doris

Thomas Eliot asked:




One response to the question — “What does your credit score mean?” — is that it is a score which attempts to show how responsible a person has been in handling their credit matters. The credit score itself is a number that is based on a statistical analysis of a person’s credit report. Depending upon the credit reporting agency involved and what evaluation system they are using, this may entail paying attention to different details which each system scores differently.

But basically, it boils down to: can we trust that this person will pay his bills and will he always pay them on time. No matter what analysis system a credit reporting agency is using — be it the Beacon model, the Emperica model, or the Fair Isaac Risk Model — it will attempt to answer these two very basic questions for the lender who is looking at putting his capital at risk through lending it out. If you were in the business of lending capital, you would no doubt want to know this same information about the people with whom you did business, wouldn’t you.

Your credit score is a number between 350 and 850, and the higher the number the better the opportunity is for the person seeking a loan. The information contained in the credit reporting agency’s files is used to calculate your credit score. Lenders use this number in helping them decide a persons credit risk possibilities as well as giving them an idea of what interest rate to charge.

High vs. Low Credit Scores

If your credit score is on the low side, then lenders assume that you will be less likely to pay them back on time. They will either charge you a higher interest rate or possibly even turn your credit application down altogether.

If your credit score is in the high range, then you probably will be able to get the loan at better interest rates. This is true for all types of credit, including mortgages. Getting a lower interest rate on your mortgage can not only save you hundreds of dollars a year, but will also save you thousands of dollars over the lifetime of the loan. It is therefore to your advantage when pursuing a mortgage loan to have the highest credit score possible.

Sometimes you’ll hear or read about something that is called a FICO score. What is a FICO score? In the financial industry, the most well known rating score is generally referred to as a FICO score, named after the Fair Isaac Corporation which initially developed this rating system. Each credit reporting agency uses this scoring model, but each has its own name for the credit scores it uses, as was mentioned above. Equifax uses the Beacon model, TransUnion the Emperica model, and Experian the Fair Isaac model.

Because your credit file at each of the three major credit reporting agencies may differ, your scores may differ as well. For this reason it is advantageous for you, if you are anticipating being in the credit market in order to make a purchase, to keep track of these various scores so that you are able to address any errors in the reporting system. Keeping track of your credit information can easily be accomplished since once a year you are entitled to obtain a free credit report from each of these three main reporting agencies. Conveniently, you need only go to one source — http://www.annualcreditreport.com — to place your order for your free yearly report from the three credit reporting agencies.

When looking at the question “What does your credit score mean?” these are the things you need to keep in mind. If you are needing help in finding ways to increase your credit score, there are sources of information available which can show you how you yourself can accomplish this without incurring a great deal of expense. Just remember that increasing your credit score is something that may take a little time, so be prepared ahead of time to put some effort and time into this endeavor.

Depending on where the problem lies — that is, is it a problem with paying off an account in order to increase your credit worthiness, or is there an error on your credit history which you can successfully dispute and have removed — the time it takes may vary in order to realize a positive change in your credit score. It may take anywhere from a few months (say three) to several months in the case of an account which needs to be payed up in order to demonstrate your credit worthiness and reduce your debt to credit ratio.

Pearl

Jack Harmon asked:




If you want to buy a house and need to take out a bank loan, you will have to know your credit score to be able to accurately calculate how mush you will qualify for. You can find many credit score calculators online that will give you your score depending on certain aspects of information that you provide.

The credit score is made up of certain late payments, how good you are with payments, how many other credit cards and loans you have, and the rate of interest that your bank is charging you.

If you want to improve your credit score so that you can qualify for a better loan, you can use the credit score calculator on any website to work out what the score is. The score can range from 300 upward to around 850 so you can then know if you should pay off a few debts first, and ask your bank for a better interest rate, so that your score can improve.

The credit score calculator can also help you to save money by showing you how to keep your finances in order. The higher your credit score is, the better the interest rates that you will be offered by your bank on a mortgage.

Most people have a credit score between 600 and 800 and a credit score calculator that gives you a score of higher than 720 will secure you a good interest rate with any bank. There are different scoring methods that are used by the three main credit scoring agencies.

Equifax uses the BEACON method, Experian uses the Fair Isaac Risk Model, and TransUnion uses the EMPIRICA method, but these are all variations of the FICO method which is the pioneer in the credit scoring sector.

A credit score calculator is found for all of the methods so that you can work out which one will give you a better credit score, although banks will take all of the credit scores into account before deciding on what type of interest rate and loan that they give you.

Credit Score Calculators Are Just An Estimate

The credit score calculator must not be taken as exact, as it is just a guide as to what your credit score will be. The banks will do a much more detailed analysis of your credit details to establish your credit score.

The credit score calculator can be used in conjunction with your bank’s mortgage lending calculator so that you can work out what your payment will be every month as well as how much the entire loan will be. Once you have improved your credit score, you can try the calculators again until you are happy with the loan that you will get.

So, if you want to get your dream house, be sure to check your credit score with all of the different credit score calculators and then approach your bank when you have improved your credit score to the level so that you can get the best interest rates possible.

Lonnie

Aubrey Clark asked:




Many people spend time working to improve their credit score but they do not take the time to look for low interest rate credit cards once they achieve a better rating. However, not doing so could be a costly mistake. As this all important number changes, it becomes vital for individuals to consider what is in their wallet. Is it the best that it could be?

Check Your Score

Check your credit score to learn if and how much it has improved over the last few months or longer. The key is to notice any larger changes. For example, if your score was below 700 but now is 750, this may qualify you for a better credit card. What difference does this make?

· A better score may result in a better interest rate. An interest rate drop even as little as half of a percent can make a big difference if you carry a balance month to month.

· You may no longer have to pay fees associated with the credit card. This includes annual fees, membership fees or other types associated with having the card.

· You may qualify for a new rewards program. If you currently have a reward program associated with your account, you may qualify for a better product.

As you can see, there are some key reasons you should investigate the various new lines of credit available to you if your score has improved. Do not assume that your current lender will automatically give you the best rate available or will improve their offer to you if your score goes up. This common misconception could be costing you thousands of dollars per year in interest.

Look For Something New

If you have noticed an improvement in your credit score, now is the time to act on it. There are a variety of lenders that now have affordable, low interest rate credit cards available to you. Those rates may be substantially lower than what you are currently paying.

To find them, simply request quotes and look at offers that are available on the web. There is a good deal of competition among credit lenders for those with good credit which means that you are likely to find substantial offers readily available to you.

Focus on a wide range of offers and narrow them down to what works the very best for you. Keep in mind that the most important factor in obtaining a line of credit is the interest rate. The higher the rate is, the more costly this card will be for your particular needs, especially if you carry a balance from month to month.

Nevertheless, low interest rates are available and if you have good credit, you should have them. If not, it may be time to change up what you are carrying in your wallet so that it better matches the quality score and the hard work you have done to improve that number. You may be impressed with the offers you can receive now.

Beth

Wayne Meyers asked:




If you have bad credit or no credit or even a bankruptcy, you can improve your credit score.

First, you should get copies of your credit report. The three major bureaus are: Trans Union http://www.transunion.com/, Experian http://www.experian.com/ and Equifax http://equifax.com.

You need all three bureaus as not all creditors report to all the bureaus.

Once you have a copy of your credit report, check it for accuracy. You can dispute incorrect items online. This is what credit card companies and lenders look at: Number of outstanding accounts and high balance. If your balances are high on many accounts, this lowers your FICO score. Pay them down.

The trick to improving your credit score is to have low balances on your accounts. Primarily on installment and credit card balances.

If you have no credit or a bankruptcy, the easiest thing to do is apply for a secured credit card. Make sure the card you get reports to the bureaus.

A note about bankruptcy: usually once the bankruptcy is discharged, you will get more credit card offers in the mail than you can stand.

Be sure to check the terms of the card. Many have tons of fees. A typical Bad credit card offer will have as much as $250 in fees and give you a $350 limit. You get a whopping $100 line of credit. Shred that one. There are better offers. You should be able to get one with little or no fees.

Use your credit cards wisely, but do use them. Use them and pay them off right away. This does two things: the credit bureaus see your good history and the credit card company will increase your limit.

Doing this just once can improve your FICO score 20 to 50 points.

It will take some time but over time your FICO score will continue to improve. After about a year or so, apply for another card with a low or no interest rate. When you get that one transfer your balances to the better card and close the other accounts.

You now have a clean credit report.

I hope this informatin has been helpful to you.

If you would like to apply for a credit card good, bad, or no credit go here: Credit Source

Earl