INFORMATION ON GETTING OR KEEPING GOOD CREDIT!!!! Knowledge is power so let me share this information I just got a presentation on credit from Americas First Credit Union. Feel free to use the share button to get this information out there for others! THE 5 FACTORS THAT MAKE UP A 100% OF YOUR CREDIT SCORE: 35% payment history (on time payments are best) 30% capacity (its good to keep 30% of your credit limit available to get a good score for capacity) 15% length of credit (older, well maintained credit is good) 10% accumulation of debt (opening a bunch of new accounts at once is bad) 10% mix of credit (installment like car or home loans vs revolving like credit cards, the perfect mix is more installment than revolving) HOW TO IMPROVE YOUR CREDIT SCORE: *pay off or pay down your credit cards (think capacity) *do not close all or a lot of your credit card accounts at once *transfer revolving debt into installment debt (i.e. using an equity line of credit from your home to pay off credit cards) *make payments on time *slow down opening new accounts (think accumulation of debt) *check your credit report for errors (annualcreditreport is the government mandated website to check your report from each of the 3 credit reporting agencies for FREE once a year. it is recommended that your stagger your free reports: for example check Experian in January, then check Equifax in May and finally check Transunion in December. By doing so, you make it more likely youll catch identity theft earlier than if you checked all 3 agencies at one time, once a year.) MYTHS OF WHAT IMPACTS YOUR CREDIT STORE: (in other words none of these impact your FICO score) *debt ratios *income *length of time at residence *length of time at job A FEW TIPS: *when opening new credit, the potential creditor can tell you what your credit score is but they can not give you a copy of your credit report. *if you are denied credit, ask the potential creditor what negative items were the reason for their decision against you so that you know what to work on. *Experian is mostly reported to by creditors in the Western part of the United States. TransUnion and Equifax usually have more items reported for people in the South (Alabama). *with the above in mind, realize each report can be different and therefore have entries the others may not *FTC.gov has a lot of identity theft tips and even has template letters for disputing errors on your credit report (always send the letter certified mail) SOLUTIONS TO HELP BAD CREDIT: *go to your bank and get a loan secured by money in your savings account as collateral (for example get a loan for $1,000 based on $1,000 in your savings account that they will in turn freeze and cease your access to until the loan is paid off) *with your BANK, get a secured credit card (instead of the ones advertised) and they really do report to the 3 credit reporting agencies. These cards are backed by money you place in an account specific to that card and said amount determines your credit limit on the card. *have someone else with good credit be a guarantor or co-signer for you on a credit item
Posted on: Tue, 10 Jun 2014 18:41:53 +0000
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