Ever Wonder What Makes Up Your Credit Score?
August 30th, 2010 | 
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A number known as the credit score helps us to know the payment methods for our bills. The number consists of 3 digits. This score may vary from 300 to 850 and is derived from your credit history reflected in your credit report.
Loans are sanctioned based on this score which makes the decision-process easier than simply viewing the credit report.
The most widely used score in the finance industry is called FICO, instigated by a corporation called Fair Isaac Company.
Different portions of your bill payment history carry different weight age and hence the credit score is derived by taking all these things into account. Although the proprietary information about your score is governed by Fair Isaac Company, still the parameters of the score calculations are well-known in the credit industry.
Payment history – 35%
Your past bill payment history reflects upon your possible late payments, collections or insolvencies that help the lenders to make informed decisions about lending. Your most recent failures damage your score more.
Debt level – 30%
Credit utilization is termed as the outstanding debt against the approved credit limit. The higher the credit utilization, the lower would be the score. Credit card balances should ideally be maintained at 30% of the credit limit.
Credit history duration – 15%
The longer is your credit history, the better it is to get credits sanctioned.
Inquiries – 10%
Inquiries are a count of the number of credit applications that one has made. The more the inquiries, the lesser is the likelihood of getting credit. However, your score only covers the inquiries made during the past one year only.
Credit Mix – 10%
Credit mix is governed by the various types of accounts that one handles. The more experience you have in managing multiple accounts, the better it is for your credit record. Since, this is not a major factor that determines your credit score; you should not keep on adding new accounts simply for the sake of it.
This can also show a negative impact on your credit management skills.
By: Lisa Max
Posted in Finance | 
Tags: Adding New Accounts, Bill Payment, Credit Applications, Credit Card Balances, Credit History, Credit Report, Credit Score, Debt Level, Digits, Duration, Fair Isaac Company, Finance Industry, Inquiries, Insolvencies, Late Payments, Lenders, Likelihood, Payment History, Proprietary Information, Sake | 
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Credit Repair Information And Tips You Can Use
Have you recently been denied a loan, an apartment or mortgage, or a credit card? You may be in need of credit repair information and tips.
Being turned down for credit is often an indication of some negative entries on your credit report, which can happen in two circumstances.
One is that you have mismanaged your credit, which includes overusing your available credit. More commonly, your credit file has some blemished information, hence negatively impacting your credit score.
No matter which situation you find yourself, it is imperative that you embark on credit repair sooner rather than later.
A little self-education goes along way in rectifying your situation, so here is some credit repair information you can use.
1. Start by requesting a copy of your credit report from all the 3 credit bureaus. You are allowed a free credit reports from each bureau per year. You can also get a free credit report if you have been denied credit within the last sixty days.
2. Upon receiving your report, study it closely. You must to examine each account (also known as tradeline) and mark those which are incorrect damaging your credit rating. Errors are more surprisingly common.
3. After you have determined which tradelines are erroneous entries, contact the credit bureau and request deletions from your report. You start with these because you have legitimate reason to dispute and most likely to have removed.
4. Even when you find some correct entries in your credit report, but the information is negative in nature, you can still try and have them removed. Find legitimate reasons such as re-aging, which means resetting of date of account, something especially common with debt collectors.
5. Make certain all your correspondence with creditors is through registered mail. You might not want to do this with the credit bureaus though, as it raises a red flag due to as this is what credit repair clinics advice their clients to do.
6. The law allows 30 days for any action to take place. If the credit bureaus determine that the entries were wrong or the creditor cannot verify the account, it will have to be deleted.
Just note that credit repair is not a quick fix, nor a one day affair. You need some persistence and guts.
No credit repair information is complete that does not tell you the things not to do. People with low credit scores often try desperate means to repair their credit and are often misinformed, hence end up hurting their credit even more. Here are some of the things you SHOULD NOT DO to repair your credit:
1. New Credit File or File Segregation: Many bogus credit repair companies entice people with false promises and bad credit repair information such as telling them they can create a new credit file. This is also known as file segregation and is illegal.
2. Many credit repair companies claim to they can repair credit by getting accurate negative information deleted from their credit reports, thus improving their rating. Now, this is not guaranteed. You must first understand the process of getting information removed. No one can actually delete negative items from your credit file except the credit bureaus and your creditors.
3. Do not close old active accounts: If you have active credit accounts, do not close them. Keep them paid on time as they help build credit history and therefore help raise your credit score
4. Do not make advance payments for credit repair if using a credit repair service. Asking for advance payments for credit repair is illegal. They can only charge you for legitimate services that they have already provided. Do not be lured into any contract promising to repair your credit before any work has been done.
By: David Kamau
Posted in Finance |
Tags: Correct Entries, Correspondence, Credit Bureau, Credit Bureaus, Credit Rating, Credit Repair Clinics, Credit Score, Creditors, Debt Collectors, Deletions, Free Credit Report, Free Credit Reports, Legitimate Reason, Legitimate Reasons, Negative Entries, Red Flag, Registered Mail, Self Education, Tradeline, Tradelines |
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How to Find Bad Credit Personal Loans
We’d all like to build up a steady reserve of funds, but the truth is that for most of us, living paycheck to paycheck has become the norm. This is due largely to the fact that the more bills we have, the harder the bills are to keep up with all it takes is a few missed payments before our credit has become irreparably damaged. While bad credit isn’t going to keep you from doing most of the things you want to do, there are some circumstances in which poor credit scores can place you in a bind. Luckily there are bad credit personal loans available for the people who need them. Finding them is simply a matter of doing your research.
Being granted a personal loan rests solely on your ability to demonstrate that you will be able to repay the loan yourself. With a personal loan, there is generally no need for collateral. Typically, your lender will look at your credit scores and credit history to learn more about your history of bill repayment. Depending on which state you live in, repayment problems as old as a decade could affect your score and make it hard (in some cases impossible) to be granted a loan through a normal lending institution.
Thankfully, there are loans that were created specifically for people whose credit is bad (or trending in that direction). Often, the lenders who grant these types of loans build their own criteria from which to judge whether or not you qualify for their loans. There are plenty of people who haven’t been able to obtain any “normal” personal loans but find that these special loans are just what they were looking for and are able to get the funds they need.
For example, loans for people with bad credit are good when you don’t need a lot of money. Perhaps you simply need a payday loan to keep your bank balance in the black until your next paycheck. While payday loans are not the best loans to take out, if you are responsible about paying them back on time, they do provide you with financial help when you need them. What really works in their favor is that they do not affect your credit score. Typically all you need to have is a checking account that has a positive history and some sort of proof of regular employment (typically more than a month at a job is required). Of course, these loans come with high interest attached–even if they are paid back on time and in full.
Rest assured that even if banks have denied you personal loans, there are bad credit personal loans that are available. If you are granted a bad credit personal loan make sure that you set up a repayment schedule and stick to it. This will ensure that your credit score will go up and future loans will be possible.
By: Terry Edwards
Posted in Finance |
Tags: Bad Credit Personal Loans, Bank Balance, Bind, Collateral, Credit History, Credit Scores, Financial Help, Lenders, Lending Institution, Living Paycheck To Paycheck, Loans For People With Bad Credit, Norm, Paycheck Loans, Paycheck To Paycheck, Payday Loan, Payday Loans, People With Bad Credit, Personal Loan, Poor Credit, Special Loans |
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Visa Credit Card and Benefits
Visa Credit Card for long has been a symbol of trust and brand value. Most people trust a visa credit card which is one reason why so many companies have a handy collaboration with them. Visa cards are available from other companies too as well as without collaboration. The Visa Signature is a great example of such a card.
The numbers that support the brand value of a visa card are amazing too. This card is accepted across as many as 150 countries. A staggering 840000 ATMs, also identify the Visa card which means customers get an amazing amount of flexibility and security in any place while travelling across countries.
Visa Card Security
Visa credit card is very secure and is one of the reasons why many people choose it over many other credit cards. One such amazing feature is the real time fraud detection and monitoring which gives card holders lot of comfort and security. The scanning systems are alert and constantly look for suspicious events in which case you card charges will be put on hold and you will be notified soon. This will ensure that fraud doesn’t take place involving your card.
Other features include theft assistance and zero liability, where the company will try to fix the problems as soon as possible. With increasing number of card thefts and identity thefts such security systems ensure that visa card holders can be less anxious about holding cards especially those with very high credit limits.
Visa Collaboration
The global presence of visa ensures that Visa credit card holders enjoy multiple benefits across the global especially when it comes to events and entertainment. Visa has collaboration with worldwide events like Olympic games and FIFA and locally popular NFL and Kentucky Derby. This is what makes the card holders feel special, beyond just offers. These add to the prestige of the card holder and to the brand value of the card over the longer time frame.
Visa Benefits
Students can get special benefits from Visa cards too that includes various types of financial aid for studies. Besides, people who love art and entertainment can avail a lot of benefits available especially on the visa signature cards. This includes huge discounts on concerts worldwide, art exhibitions, Broadway theater and even movie tickets. Similar discounts of around 20% are available of travel trips and cruise trips all over the world. Most of these discounts are possible due to the extensive popularity of the Visa credit card.
This lends credibility to the card holder as well. Card holders can save a lot in luxury hotels, culinary, wine tastings and a range of other dining offers across the world. World class hotels like Marriott and computer products from Toshiba also have dealings and collaboration with Visa giving card holders multiple benefits.
Visa card holders apart from the innumerable services including paying bills online credit card, giving to charity, travelling across the globe and buying tickets for events and movies also get additional free services like personal finance resources and ATM locators as a sign of customer service more than anything else.
By: Sagbee C
Posted in Finance |
Tags: Card Charges, Card Holder, Card Security, Credit Card Holders, Credit Cards, Fifa, Fraud Detection, Global Presence, Kentucky Derby, Olympic Games, Scanning Systems, Security Systems, Suspicious Events, Time Fraud, Visa Card Holders, Visa Cards, Visa Credit Card, Visa Signature, Worldwide Events, Zero Liability |
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Even With a Bad Credit History You Can Still Get a Credit Card
Yes having a bad credit history makes it a little harder to get a credit card, but it still can be done. You just have to use alternative methods than applying for the usual major cards like Visa, Mastercard, Discover and, of course not, American Express.
You can, however, apply to some unconventional places. These places don’t give you the same benefits as the major places, but they still help to build your credit nonetheless.
Here are the five ways you can still get a credit card with bad credit history.
1) Apply for credit within your credit union – Many unions associated with jobs offer credit through them. They disregard the bad credit history because they can receive their payments directly from your bank account. They basically make the decision based on your credibility of staying on that job.
Many times they offer them, but most of the time they don’t. They will usually just give you a monetary loan. Just check with your union’s guidelines.
2) Get A Co-Signor – Although a credit card company may not accept your application solely based on your credit alone, they will allow someone with good credit to go on the loan with you. This is because they are taking the word and history of the co-applicant and are assuming that based on their credit history, they are likely to make the payment in case you have to default.
3) Apply for a neighborhood store card – You may not be able to qualify for a large department store like Macy’s, Sears, etc due to your bad credit history, but a local mom and pop store would allow you to get credit. Especially if you already have a good rapport with them.
4) Apply for a prepaid credit card – This is a card that you have to put money in an account, and use the card against that money. Although this really does not help with your credit because there is no loan involved, you can use it as an alternative to cash when needed.
5) Apply for a secured credit card – This is like a prepaid credit card in that you have to put a certain amount of money into the card’s account and you can only charge up to that deposited amount. However, this type of card does report your usage as credit.
Yes having bad credit history can become a blemish to our lifestyle and prevent us from getting “real” credit cards, but there is a means to an end. Just use the above methods, pay on time, and in six months to a year, your credit history will be good.
By: Naqueen Zaire
Posted in Finance |
Tags: Alternative Methods, American Express, Bad Credit History, Cards, Credibility, Credit Card Company, Credit Card With Bad Credit, Credit Unions, Department Store, Job, Macy, Mom, Money, Neighborhood Store, Pop Store, Prepaid Credit Card, S Sears, Secured Card, Secured Credit Card, Visa Mastercard |
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So What If I Don’t Know My Credit Score?
It is beyond my comprehension to note that many people don’t have a clue what their credit score is. For one thing, this is easy to find out and determine. But even more importantly, especially in these dire economic times, your credit score is something you should know as well as you know your phone number or street address because of the huge importance it has on virtually every aspect of your life.
You think you don’t need to know your credit score because “what it is is what it is and I can’t do anything about it”? Nothing could be further from the truth. In fact, multiple studies over the years have shown that the majority of consumer credit reports have errors in them, which impacts how your credit score is calculated. Just one error in your credit report, such as reporting someone else’s charged-off account as being part of your report, can lower your score to a level which may disqualify you from getting approved on that mortgage or new car loan.
And there definitely is something you can do about it. If one or more of the three major credit bureaus are reporting inaccurate information about you, it is actually your duty and responsibility to do something about it to get it corrected. One common myth is that those inaccuracies will self-correct over time, but again, that is a myth. If you do not dispute the inaccurate information being reported about you, that inaccurate information will continue to be reported for many years and may never “self correct”.
So you think you don’t need to know your credit score because you have no plans to apply for a loan or new line of credit? Although applying for a loan is the most common place your credit score is used, it is far from the only place. More and more, this score is being used to evaluate a person who is applying for a new job, to determine if they should be approved to rent this house or apartment, and even for car insurance. Car insurance companies allegedly have statistics that prove that people with lower credit scores make more claims on their car insurance, so if your credit score is low, chances are good that your car insurance is costing you more than it needs to.
Get a free copy of your credit reports today, one from each of the three major credit bureaus. Chances are better than excellent that your reports are different at each credit bureau since different accounts report to different bureaus, and therefore each agency has a different view of your and your usage of credit. But this aspect only compounds the issue of having errors on your report, which you need to get corrected.
By: Jon Arnold
Posted in Finance |
Tags: Apartment, Car Insurance Companies, Clue, Common Myth, Comprehension, Consumer Credit Reports, Consumer Reports, Credit Report, Credit Score, Economic Times, Inaccuracies, Insurance Car, Major Credit Bureaus, Many People, Mortgage, New Car Loan, New Job, Phone Number, Street Address, Three Major Credit Bureaus |
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How To Place A Security Freeze On Your Credit Report
Probably the best way to protect yourself from identity theft is to place a security freeze on your credit profile. A “credit freeze” or “security freeze” is a notice placed on a consumer’s record that prohibits reporting agencies from revealing the individual’s private information to third parties without the express consent of the consumer. Most lenders will not issue credit without first pulling a consumer’s credit report. If an identity thief manages to steal your social security number and other private information, he or she will be unlikely to get a loan if your information is barred from review. Most lenders require a credit pull before they will extend credit, so if a hold is in place, your information will not be available to lenders when an identity thief goes to take out a loan in your name. A security freeze provides an effective barrier to credit, loans, and services being approved in your name without your authorization.
How to get started
Send a certified letter to each of the three major bureaus. (mailing addresses below)
Provide your address, social security number, date of birth and full name (including Jr., Sr., II, III, etc.). If you have moved during the past 5 years, include your previous addresses. Provide a copy of a telephone or utility bill to verify your address. Include a copy of your driver’s license or government issued identification. Your first request is free. If this is not your first request, include a check for $10.
How to lift the freeze
In response to your certified letter, the bureaus will send you a confirmation response that will include a pin or password. To lift the freeze you will need to provide: proper identification, your pin or password and the information about the specific party who is to receive the information OR the time period that you want the hold to be lifted. It will also cost $10-$12 each time that you lift the freeze. Retain the letters that you receive from Equifax, Experian and TransUnion because they will provide specific instructions regarding what to do when you need to allow access to your profile. Remember that you will still be able to check your own record for inaccuracies.
You can write to the three major credit bureaus using the following addresses:
Experian Security Freeze
PO Box 9554
Allen, TX 75013
Equifax Security Freeze
PO Box 105788
Atlanta, GA 30348
TransUnion Security Freeze
PO Box 6790
Fullerton, CA 92834-6790
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Posted in Finance |
Tags: Confirmation Response, Consumer Report, Credit Freeze, Credit Loans, Credit Profile, Credit Report, Date Of Birth, Equifax, Experian, Identity Theft, Jr Sr, Lenders, Previous Addresses, Social Security, Social Security Number, Thief, Third Parties, Three Major Bureaus, Time Period, Verify Address |
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Best Places to Refinance Auto Loans
You might not know it, but you can save quite a bit of money when you refinance auto loans. And there are numerous ways you can refinance the auto loan. As long as you follow through the entire process you can be sure to save on your monthly car payments. What would you say to a savings of $60 a month on your current car payment? That’s $720 a year and $3600 over the course of a normal 5 year loan. Now we’re talking about a large amount of cash!
So where do you refinance auto loans?
1) Your local bank.
Local banks can be a good place to refinance a car loan, especially when you already have a solid relationship with the bank. Check them out first, but don’t just take the first offer you get. Take some time and do your own research into other possible refinancing options as well to get the best deal.
2) Your local credit union.
Credit unions often offer outstanding refinancing rates, especially for those with high credit scores. Just be aware that many credit unions won’t work with those that have had past credit problems or issues with their credit rating.
3) Your local car dealer.
Car dealers can work with you to refinance auto loans, however many times they will just try to sell you a new car. This completely defeats the purpose of trying to refinance your car loan in the first place and will often lead to even higher car payments. If you choose to refinance through a car dealer make sure you don’t get sucked into buying a new car.
4) *BEST* Online solutions.
Using an online lender can be your best option to refinance auto loans. You’ll find that the application and approval process can both be easier than offline loan companies. Plus, the online auto lenders will go through a network of companies to get the best rates for your car loan. Another positive is that the online lenders will only need to pull your credit report once to compare rates meaning you’ll have less activity on your credit report and less chance of being penalized because of too many inquiries.
Once you get out there and compare auto loan refinancing options you’ll see that in many cases online refinancing is the way to go. It allows you to quickly and easily compare rates from a bunch of lenders and will almost always get you the best terms and save you the most money.
By: Steven Walters
Posted in Finance |
Tags: Auto Lenders, Auto Loan, Auto Loans, Best Places, Buying A New Car, Car Loan, Car Payment, Credit Rating, Credit Report, Credit Scores, Credit Unions, Dealer Car, Loan Companies, Local Bank, Local Car Dealer, Money Loans, Monthly Car Payments, Online Lenders, Refinance Loans, Refinancing |
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