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700 Credit Score – Is 700 a Good Credit Score

January 11th, 2021

A 700 credit score is quite common. If you are wondering whether a 700 credit score is good or bad, and you would like to know how to improve your credit score then read this article to discover the benefits of and methods of getting a good credit score which is above the 700 level.

In this article we will look at why having a good credit history is important how to find out what your credit score is if you do not already know, and discuss whether a 700 credit score is good or bad. We will also look at methods that you can use to rebuild and repair low FICO scores. After reading this article you should have a pretty good idea about how these scores are calculated and what you can do to improve them.

Why having a good credit history is important

These days it is very important to have a good credit history and score. Reports and scores determine whether a lender will let you borrow money at a good rate of interest. If you have a very poor credit history then it is unlikely that anyone will be willing to lend you any money at all, as you will be considered a bad risk to them and they will think that you are less likely to meet your payments than someone with a better history of managing their debt.

If you are thinking of applying for a car loan, mortgage or any credit-card then it is probably a good idea to check out your FICO score and history with the credit reporting bureaus first. If you apply for a loan, mortgage or credit-card and get turned down, this enquiry on your report can be seen by other lenders and may put them off lending money to you as repeated applications can harm your FICO score.

How to find out what your credit score is if you do not already know

If you do not know what your credit score is then you can find it out by applying to the credit bureaus. These credit reporting agencies are Experian, TransUnion and Equifax. They are obliged to provide you with one copy of your free credit report every 12 months. There may be a charge for them to provide you with your actual credit score though. This FICO score may be slightly different with each credit reporting agency.

You should also be aware that lenders may calculate your credit score differently to the credit reporting agencies. When you request your credit score from either Experian, TransUnion or Equifax they will only take into account your personal credit history. If you are financially linked to another individual who has a poor credit history then this may not be apparent from looking at your FICO score as provided by the credit bureaus.

If for example you have a joint bank account with your husband or wife and they have a poor history of managing debt, then this may reflect poorly on you, and you may not find it as easy as you might think to obtain loans.

Is 700 A Good Credit Score?

A 700 credit score is quite good. A FICO score over 700 is very good, but anything below the 700 mark is not so great. The typical range of values that credit scores can be is anywhere between 350 and 850, these figures are quite extreme though, 700 is fairly typical. The chances are that if this is your FICO score that it can be improved. If you have a score of 620 for example, it could definitely use some work. Let us take a look at some methods that you can use to get your FICO score over 700 or even higher. Any work that you do to improve your credit score is well worthwhile and will result in you being able to get a loan at a better interest rate and lenders will be more inclined to want to do business with you.

Methods that you can use to improve and repair a FICO score

Try to repay any loans or credit-cards that you have on time each month. If you are struggling to meet your payments then contact the lender and they may be able to work out an easier way for you to clear your balance, such as extending the loan over a longer period. Always pay your household utility bills on time. Try not to miss any payments at all. Request your credit report from the credit bureaus and dispute any errors that you find on it. This will get any mistakes deleted from your report.

If you are able to pay off any loans or credit cards then do so, but do not close the accounts. This is because lenders often calculate your score based on how much debt you have compared to the total amount of money which you have available to borrow.

In conclusion, if you have a 700 credit score it is actually quite good. This does not mean that you cannot improve on it and make yourself a more attractive prospect to consumer credit lenders such as banks and credit card companies. If you do decide to get your credit score over 700 then make sure that you follow a proven system which if successful, will open up the possibility of you being able to borrow money at a good interest rate. This is something that you can do yourself and there is no need to employ anyone else to do this for you.

You certainly should not employ the services of any credit repair companies which claim to be able to improve your situation instantly. Getting and improving on a 700 credit score is something that you can do yourself quite easily. All you need is a step-by-step blueprint which provides you with all the information that you need to know. There is one such step-by-step method to raise your credit score which I recommend.

Practical Tips For a Good Credit Rating Score

December 16th, 2020

Shelve your unused cards but keep the credit facility open

If you have more than one credit card and you are considering closing down the facility so that you are not tempted to spend any more with them, here is a suggestion that can actually help to keep your credit score looking healthy.

Instead of closing the credit facility, shelve the card and keep the line of credit open. The reason for this is that you have already been granted a credit amount which will show up on your credit report as part of your accumulative credit limit, and if it has a zero balance owing then your overall debt ratio is lower and this works in your favor.

For example, if you have 2 cards with a $3000 limit on each effectively you have a $6000 line of credit. If you regularly use one card up to $1500 then pay it off each month, you are only using 25% of your available credit which is great in terms of your credit rating.

But, if you closed one card, then you only have a $3000 line of credit and you will be using 50% of your available credit each month, still OK but not as favorable to your credit rating.

You may need to very occasionally use this card just to keep the credit facility active.

Use your credit card and make it work for you

First of all this is not promoting erratic spending, but rather this promotes using your card on a regular basis to give you a good credit rating score.

If you use your credit card to purchase your groceries, gas, utilities etc, that’s fine – just make sure you always keep these 2 things in mind:

Never exceed 50% of your credit limit (and preferably even less than 50%)
All purchases must be paid in full by the due date

Keeping your card less than 50% of its limit shows that you are not living on debt and gives credit suppliers confidence when they are reviewing your credit history.

Paying off your card in full every month shows you as consistent, reliable and builds credit-worthiness, plus credit suppliers can see you are living within your means.

Consistency is the key here and it adds up over a period of time – who would have thought you could improve your credit score a little just by doing your groceries each week!

Make sure your credit report contains no errors

It might seem like a trivial thing to do, but it can be quite surprising how many people find actually find incorrect file comments, or clerical errors that have been attributed to their credit report and these errors can have an effect on your credit score.

That’s not to say it happens all the time because it doesn’t, but for the sake of a few minutes of your time it really can be worth doing.

If you do find errors, you will need to gather evidence to refute the claim, so a well kept record of all your statements and receipts is invaluable for this. If you have not kept your statements or receipts, then you will have to pay a visit to the place of purchase to seek a copy of receipt. Of course it’s a little more time consuming, but still well worth the effort.

Finally, if you do have to dispute an incorrect comment or claim it will be far more productive if you approach the credit bureau in cool, non-threatening manner, simply stating the facts backed up with written evidence. No point getting all steamed up and going at them with all guns blazing – this will just hinder your progress and make things difficult if you need their assistance in future.

Try using these three tips – you will be quite surprised how effective are in helping you gain a good credit rating score and boosting your credit worthiness.

Guidelines For Establishing a Good Credit Report After Marriage

December 8th, 2020

Establishing credit is essential after marriage if you want to build a healthy financial life as well as your marital life together. You need credit to obtain credit cards, joint bank accounts, mortgage loans, car loans, etc. Thus, it is a good idea to give the first steps from the beginning so as to start building your credit right away and make good use of it whenever you need it.

Following are some tips on how to start establishing a good credit history. There is no particular order that you need to follow. However, we strongly suggest that you try to find out about your current credit situation. First of all, obtain a free copy of your credit report to see if you already have some credit history and you didn’t know it.

Getting A Free Credit Report

As stated above, you need to obtain a free copy of your credit report. Why free? Because there is no reason for you to pay for information that third parties have about yourself. Regulations have recognized this and force credit bureaus to provide you with a copy of your credit report free of charge at least once a year. On some states the timeframe is even shorter and you can obtain a free copy twice a year or even more often.

In order to do so, you can contact each credit bureau directly or resort to one of the many online sites offering access to your credit report for free. These sites also offer many different services (credit related) that you may find useful. These services include: monitoring services, credit repair services, financial and legal advice, etc.

Secured Financing

Sometimes it is hard to get financing when you have no credit at all. However, it is possible to do so by offering some asset as collateral. A good idea is to use your car as collateral if you own it. There are many lenders out there that will be willing to accept a car as collateral to secure a loan. That will guarantee you both approval and advantageous terms on your loan.

An alternative for establishing credit is to apply for a secure credit card. A secure credit card will provide you with the same benefits as an unsecured credit card with the sole difference that you’ll have to make a cash deposit that will act as your credit limit. Up to that amount you’ll be able to use your credit card without problems. The regular payments of your credit card balance will be recorded into your credit report and consequently build a clean and positive credit history for you.

Mortgage Financing: Down Payments and Co-signing

The key to get a good credit report from scratch is to obtain a mortgage loan and keep your payments timely. To obtain a mortgage loan without credit, you can offer a high down payment that will show the lender your ability to save and thus, your ability to repay your debt. Alternatively (or jointly) you can get the aid of a co-signer with a good credit score. The co-signer will also be obliged to repay the loan in case you fail to meet the monthly payments. Thus, the lender won’t have problems when it comes to approving your loan. And the monthly payments of your home loan will greatly contribute to establishing a clean and financially healthy credit report.

Practical Tips For a Good Credit Rating Score

November 25th, 2020

Here are a few practical tips you can use to gain a good credit rating score and boost your credit worthiness as you go about your day to day living, with little or no extra effort required.

Shelve your unused cards but keep the credit facility open

If you have more than one credit card and you are considering closing down the facility so that you are not tempted to spend any more with them, here is a suggestion that can actually help to keep your credit score looking healthy.

Instead of closing the credit facility, shelve the card and keep the line of credit open. The reason for this is that you have already been granted a credit amount which will show up on your credit report as part of your accumulative credit limit, and if it has a zero balance owing then your overall debt ratio is lower and this works in your favor.

For example, if you have 2 cards with a $3000 limit on each effectively you have a $6000 line of credit. If you regularly use one card up to $1500 then pay it off each month, you are only using 25% of your available credit which is great in terms of your credit rating.

But, if you closed one card, then you only have a $3000 line of credit and you will be using 50% of your available credit each month, still OK but not as favorable to your credit rating.

You may need to very occasionally use this card just to keep the credit facility active.

Use your credit card and make it work for you

First of all this is not promoting erratic spending, but rather this promotes using your card on a regular basis to give you a good credit rating score.

If you use your credit card to purchase your groceries, gas, utilities etc, that’s fine – just make sure you always keep these 2 things in mind:

Never exceed 50% of your credit limit (and preferably even less than 50%)
All purchases must be paid in full by the due date

Keeping your card less than 50% of its limit shows that you are not living on debt and gives credit suppliers confidence when they are reviewing your credit history.

Paying off your card in full every month shows you as consistent, reliable and builds credit-worthiness, plus credit suppliers can see you are living within your means.

Consistency is the key here and it adds up over a period of time – who would have thought you could improve your credit score a little just by doing your groceries each week!

Make sure your credit report contains no errors

It might seem like a trivial thing to do, but it can be quite surprising how many people find actually find incorrect file comments, or clerical errors that have been attributed to their credit report and these errors can have an effect on your credit score.

That’s not to say it happens all the time because it doesn’t, but for the sake of a few minutes of your time it really can be worth doing.

If you do find errors, you will need to gather evidence to refute the claim, so a well kept record of all your statements and receipts is invaluable for this. If you have not kept your statements or receipts, then you will have to pay a visit to the place of purchase to seek a copy of receipt. Of course it’s a little more time consuming, but still well worth the effort.

Finally, if you do have to dispute an incorrect comment or claim it will be far more productive if you approach the credit bureau in cool, non-threatening manner, simply stating the facts backed up with written evidence. No point getting all steamed up and going at them with all guns blazing – this will just hinder your progress and make things difficult if you need their assistance in future.

Build a Good Credit Rating Score With These Easy Techniques

November 3rd, 2020

Previously we discussed how to build a good credit rating score using some of the more commonly known methods, so this article reveals a few lesser known bit still highly effective techniques for building your credit rating to even greater levels.

But before proceeding here is a quick recap of the 3 simple credit building techniques discussed in the previous article:

Shelving your unused cards but keeping the credit facilities open
Using your credit cards and making them work hard for you
Making sure your credit report contains no errors

The first two above require that you use revolving accounts (these are credit facilities that allow you to purchase and pay off) and if you have implemented these techniques correctly your credit rating score will be on the improve with little extra effort required on your part.

But not everybody has these credit lines available to them especially with today’s stringent lending policies, or if they do, they feel uncomfortable using them as it could just be a little too tempting to overspend.

However the reality is: you need credit to actually build your credit score (not that this is saying “rush out and get more credit to get your credit score higher!”), so if are looking for a loan to build credit with here are some lesser known but still highly effective tips for building a good credit rating score:

Look at using peer to peer loans

Known also as social lending, peer to peer lending sites link borrowers to private investors. Two sites are Lending Club.com and Prosper.com plus there are quite a few more.

You can apply to these institutions and secure loans on fixed terms for up to 3 years. Individual investors then look at the loan application packages and will “bid” if they are interested in your deal, which is then signed up in due course.

The lending sites then report your credit activities as any other lender would to at least two of the three credit bureaus – Experian, Equifax and TransUnion and if you are showing yourself to be diligent and timely with your payments, this will of course enhance your credit score.

Prosper requires applicants to have a minimum current score of 640 and the Lending Club requires 640 minimum – but worth looking at if you are at this level.

Apply for a secured credit card

If you are unable to get a regular credit card, a secured credit card may be a good option.

You will be required to make a deposit generally around $200 – $1000 which will give you a credit limit of the same amount. The benefit of using a secured card is twofold, in that you cannot exceed your credit limit which is great for those who are easily tempted and you can use the card often, then repay it by due in order to gain more credit-worthiness through regular timely payments and build a good credit rating score.

However, you will not want to exceed 30% of your limit at any time in order to gain maximum credit building traction and as mentioned above it must be paid off in full, on or before the due date.

Also make sure that the card you apply for reports to all 3 credit bureaus and always check that their setup fees are not over the top.

Apply for a charge card

For those who have a good credit history, but don’t like credit cards you might want to consider a charge card such as American Express or Diners Club.

Charge cards require that you pay them off in full every month however they do have a hidden advantage over credit cards and it’s this: They do not dent your credit score like credit cards do if you exceed a certain percentage of your credit limit – it’s called credit utilization.

As an example let’s say you have a credit card with a $5000 limit and you go out and purchase $3000 worth of goods during that month then pay it off before it’s due.

So you have been using 60% of your available credit and even though you pay it off by the due date, in the eyes of the credit score calculator ‘FICO’ – 60% usage is above what they calculate as “good” and your credit score will suffer loss.

However charge cards are not calculated on this basis as they don’t have traditional credit limits and so FICO treats the calculation differently, meaning you can run your account up to higher percentages without your credit score being penalized – a nice advantage if you need the extra credit.

All you have to do is ensure you pay it off in full every month and you will be building credibility and more credit score points.

So there you have 3 lesser known, but still highly effective tips to help build a good credit rating score.

For even more credit repair info visit the link below.

Michael J Robinson has a keen desire to see people restored to full credit-worthiness which is why he contributes these self-help articles.

Why Are You Opening Your Wallet to the Credit Card Companies

October 26th, 2020

Repairing you credit is absolutely vital if you want to afford a comfortable lifestyle. Now comfort is going to mean different things to different people so I will assume that you are not comfortable with your current life style. This information is not meant to make you rich nor will I promise you that it will apply to everyone. I know from my experience and those of my friends, family, and clients that having a good credit score can mean the difference in you being able to afford the house you’ve always wanted and living in an apartment. To be honest many jobs today will not hire you if you do not have good credit so if you want to move to a better job or career you need to get your credit in order.

Credit just like money is a state of mind meaning that money and credit mean different things to different people. If you where brought up believing that money was important and that it should be respected, saved, and invested then you are more than like going to accumulate a lot of it. If on the other hand you were brought up believe that money was just to spend no matter how much of it you had you are more than likely going to be living out of your means or in the red.

The good thing about this is no matter how you where brought up you have a choice on how now and in the future you will treat your money and your credit. The basis of any good strategy is to think it out find out why are you in debt. I know you are probably saying “Duh” I could not pay my bills. I know the generic reasons why but you have to dive in deep in your mind and discover for yourself why you are really in debt?

Most of my clients when I first meet them say they are in debt because they had a major emergency and it made them late on their credit card payments or some other “Excuse”. If this is you don’t worry I have been there to and for 12 years I used the same excuses. I blamed the credit card company who gave me the credit card, I blamed the bank for giving me credit knowing I did not have a good job, I even blamed the rich because they had money and credit, and I was just trying to live like them.

If this is you do not worry because the cycle can be broken you just have to choose which way you want to live. You can choose to have good credit and have money or you can choose to spend everything you got on things you really do not need so others can admire what you have. Don’t worry about trying to impress the “Jones’s” by keeping up with them because the “Jones’s” are usually broke they may make a little more income than you but they are spending much more than they take in so in essence they are “dead broke”.

I am not advocating that you should not have nice things you should have all the nice things your heart desires the point I am making is that if you are buying things and paying interest on them without a purpose you are robbing yourself. I am not saying do not by anything on credit because that is the way you build credit. I am saying what you buy on credit matters. If you are buying your gas on credit because you got a low interest rate and use it frequently and don’t mind paying the small interest rate to build your credit then I say go for it. On the other hand if you are buying everything on your credit card and then at the end of the month paying the minimums you are really robbing yourself. Some people use their credit cards to purchase everything because they think it is cool to slide the card. I know it sound ridiculous but believe me it happens all the time.

There are only three reasons you should use your credit card.

• Emergencies
• Planned small purchases to build your credit pay off slow to build your credit on low interest credit cards.
• Large pre planned purchase that you will pay off fast.

If something else outside of the above comes up you need to have the will power to delay instant gratification until you can afford to pay for it in cash. If you do not you will just spend and spend until your credit is exhausted and your credit score takes a dive. Believe me I have been there. The credit card company is in the business of making money so extending your credit line is meant to entice you to spend more money; this is how they stay in business. If you spend your credit line you are back to square one and are in debt to the credit card company.

It can be a big cycle if you let it. You have to live within your means. The only way to do this is to plan out your purchases and set budget for leisure things like eating out, movies, and so on. If you know how much you have to spend after you have taken care of your initial bills you can budget so you are not swiping your credit card for things like movie tickets. Movies are already expensive enough without tacking on high interest rates over a long period of time if you do this that $10 movie ticket could balloon and you end up paying $100’s for it.

With all that said I hope you get the point that until you actually choose to have good credit you will not. The credit cards and the companies that offer them are businesses and they could care less about what emergency has come upon you. You have to make a conscious effort to minimize not only what you spend on but how you spend it.

What’s a Good Credit Score

October 15th, 2020

Before I reveal to you “whats a good credit score” you need to know that all 3 credit bureaus have a credit score for you and they will usually vary 10 to 40 points depending upon the number of bad credit items that are on each specific credit report.

Why does each credit bureau have different scores for you? Because not all creditors report to all 3 credit bureaus; therefore, you may have more bad credit items on a report than the other two, thus the report with the most bad credit items on it will have the lowest score.

Most mortgage lenders look at what is known as the Fair Isaac or FICO Score. A FICO score can range from 300 (very bad) to 850 (very good). The median is 723, according to Fair Isaac statistics. Recently, the 3 main credit bureaus, Experian, TransUnion and Equifax have developed their own combined score to compete with lenders that use the FICO score and they are trying to encourage lenders to use their new scoring system that they call the “Vantage Score”. It ranges from 500 (very bad) to 990 (very best) and like the FICO score it is based on the review of all 3 credit bureau scores along with their own proprietary formula.

So whats a good credit score?

The bottom line to having a good credit score irregardless of whether it is an Experian, TransUnion, Equifax, FICO or Vantage score is – the more “bad credit” items that you have reported on your 3 credit bureau credit reports the lower your credit score will be on your FICO and or Vantage score. It is that simple.

The key to achieving a good credit score is to be able to get any and or all of the bad credit items removed from each of the 3 credit bureau credit reports. More on how to get that done later.

How Is A Good Credit Score Calculated?

Your credit score is simply a number representing your life as it relates to your past and existing debt. Each credit bureau, FICO and Vantage has it’s own proprietary algorithm that they closely guard but there is general information available as to how they all calculate their score for you. Like it or not Creditors use your credit score no matter where it comes from as the indicator of your creditworthiness. Your credit score is calculated using five key categories.

How the Scores Are Calculated

1) 35% of your Score is devoted to Payment History. This would include missed payments, collections, bankruptcies and the like. The older the information the less of an impact on your overall score.

2) 30% of your Score is based on Utilization. This is the amount of credit you have in used as compared to your available credit. The recommendations point to less than 10% of your available credit be utilized.

3) 15% of your Score is impacted by your Credit History. Effectively how long you’ve had accounts open and obviously takes some time to build.

4) 10% of your Score is based on Inquiries. If you apply for various forms of credit and then don’t get that credit it will impact you negatively. Checking your own credit does not impact this number.

5) 10% of your Score is determined by Types of Credit. This would be different forms of credit such as mortgages, auto loans, revolving credit and installments.

Did you notice that there Is something Missing? You’ll note that there is no consideration for your actual income in this model. Interesting to say the least don’t you agree? Your income doesn’t have anything to do with calculating your credit score. Lenders do.

Whats a Good Credit Score?

How many times am I going to make you ask me “whats a good credit score” before I answer? OK, ok. The short non-scientific answer is 760 or above. That’s the score that is going to get you the best interest rates possible on a mortgage, auto loan or many other forms of credit. That doesn’t mean that each lender will offer you the same rate if you have that magical 760 score. It will depend upon the amount of money a particular lender has available at the time that you apply for your loan that will dictate what the loan rate they will offer you.

If your score is 760 or above then I recommend that you monitor your credit scores and if drop for some reason you will know immediately and you will be able to do what needs to be done to get it back to that magic number. Why is that important? Because if you allow it to drop within 30-60 days you’ll see many of your loans and or credit card rates slide upward. How can that happen you ask? The “fine print” on every loan or credit card agreement will usually allow the lender to adjust your rate without notice if your credit score changes.

If your credit score is far below the magical 760 score then you may want to learn how you can force all three of the credit bureaus to give you a good score. There’s a way to do that. Let me know if you are interested.

Thomas is head of the legal research department for Debt Elimination Tools – LLC which is the #1 Source of Legal Tools & Resources for helping Consumers deal with Debt Collectors, Discouraging Creditors From Suing You, Getting Lawsuits Dismissed, Clearing Away Debt & Restoring Credit to 740+.

How to Establish Good Credit

September 25th, 2020

Even though you don’t currently possess any credit to speak of, like most people, you will have significant plans regarding the future. Perhaps you are a fresh college graduate or maybe a younger individual wanting to buy your first new automobile.

For those who have never needed to make use of credit before, Great! Obviously, it’s best to pay cash for the things you need so that you don’t need to bother about credit card payments, loan installments, or interest rates.

However, if you’re young, the likelihood of you needing credit in the future are quite real. Someday you might like to purchase a house. The odds are pretty good that you simply probably won’t have the cash outright to buy these high ticket items which mean you are going to have to have credit. Moreover, it’s always good to have a little credit because many utility companies will want to take a look at your credit to supply you with energy for example.

Whenever you are starting off fresh with no credit history at all, here are a few methods for getting a good beginning on setting up good credit:

1.Pay your bills punctually, in particular mortgage or rent payments. Aside from severe situations like bankruptcy or tax liens, nothing has as big of an effect on your credit history as missed repayments.

2.Create credit early. Possessing clean, active charge accounts set up many years ago will certainly boost your rating. If you are averse to credit, on principle, think of setting up automated monthly repayments for, say, utilities as well as phone on a credit card account and locking the card away where it is not a temptation.

3.Don’t max out readily available credit on credit card accounts. Lenders will not impressed. Rather, they are more likely to assume you have difficulty managing your finances. Beyond a couple of credit cards, it begins to get complicated.

4.Never make an application for too much credit in a short period of time. Multiple requests for your credit history (excluding requests by you to check your file) might lower your rating. When you are shopping around for good loan rates, think that every occasion you give your Social Security number to a lender or credit card organization, they’re going to request a credit history.

5.Always be neat as well as consistent while filling out credit applications. This will likely insure that all your good deeds get registered in a single file, instead of many files or, even worse, another person’s file. Watch out for inconsistencies in use of “Jr.” and “Sr.”

6.Examine your credit history for errors, in particular if you will before long be requesting a time-dependent loan, like a mortgage loan.

One fantastic way to begin building credit is to apply for a store credit card (Sears, JC Penney, etc.). When you receive the card, come up with a few modest purchases and then pay them off totally. Try this several times during a year and you will find yourself with some established credit by having an excellent payment history. You should not go overboard and get a lot more than what you are able pay for, though.

Also you can get a secured credit card. These cards ask that you place some money ınside your account for which you will be given a charge card. Then you can make purchases up to the amount of money that is within your account. Credit scoring agencies deal with these cards the same as regular credit cards and look in their eyes as a reliable way to create a favorable credit history.

You will have to have a checking account to establish credit. This adds to your standing with lenders and shows that you can manage your money effectively.

When trying to get a credit card of just about any type, you should definitely inquire if they report to any of the credit reporting organizations. As we’ve stated before, they’re not required to do this, and if they do not, acquiring one of these cards or loans will not do you a lick of good even if you make your payments by the due date.

It’s also possible to create credit by making a purchase or perhaps making a request to borrow money by using a co-signer. A co-signer is known as a person with good credit history who will be basically telling the lending company that they will be responsible for making certain you make your payments on time. Frequently a co-signer is a family member such as a parent. This can be a risky proposition for them, so know that they are placing their own personal credit track record at risk simply to give you some help, so never let them down.

When making a request for a loan, such as a automobile loan, it is also helpful should you have a substantial advance payment to make thus lowering the money you will need to be lent. This will show the lending organization that you are able to save and so they are more likely to take a risk on you dependent upon this factor on it’s own.

A Good Credit Score Means More Than Just Getting a Loan

September 6th, 2020

When you think of the benefits of having a good credit score, you usually start with how your score affects your ability to get financing. A good score makes it easier to get a loan such as a car loan or mortgage, and it is key in getting a low-interest rate. A bad credit score will make lenders leery of giving you money so even if they are willing to approve your application (something that certainly isn’t a sure thing now days), they are going to make you pay more for the loan in the form of higher interest rates to offset the risk that you will default on the loan.

Because of how your credit score gets factored into loans, the simple three digit number that is your score can play a huge role on your overall quality of life. They way it limits or opens up opportunities can determine the size home you are able to purchase, the car you drive, and how much of your earnings go toward assets that increase your overall wealth versus generating profits for the bank (which can affect future big-ticket purchases, your children’s education, your retirement, etc.).

But this is not the end of the story. Credit scores which were initially created as a tools lenders could use to quickly determine credit risk, as opposed to digging through each item of your credit reports in an effort to determine your credit worthiness, have been adopted by other industries as well.

Today, not only will your credit score play a role in how your paycheck gets spent, it can affect how much is in your paycheck in the first place. Many employers will use the credit scores of job applicants to aid in the hiring process. Reading through resumes and checking references is a time-consuming process so credit scores are used as a shortcut. Applicants with poor credit scores are viewed as less dependable and trustworthy and will have a harder time even being considered for a position when competing against similarly qualified individuals with good credit. They may not even be given a chance for an interview. Additionally, in certain industries where employees have access to money such as banks, a low credit score automatically disqualifies a person from working there.

Car insurance companies are another group that have adopted the use of credit scores to help determine risk. Studies have shown that drivers with low credit scores are more likely to file insurance claims. And since claims cost the insurance companies money, they want to make sure that the people more apt to file them are charged accordingly. For this reason, the vast majority of auto insurance companies factor in your score when drawing up a policy. The lower your score is, the more you will have to pay in insurance premiums.

Credit card companies also take your credit score into account, which is something most people were aware of, but not everyone realizes the extent of it. Since a credit card is similar to a loan in that you are granted a line of credit that you are required to pay back with interest, it makes sense that credit card companies factor your score into how much credit you can get approved for and at what interest rate. What not everybody realizes is that these figures are not fixed. A credit card companies like to include a “universal default” provision in their contracts in which they reserve the right to monitor your credit reports and increase the credit card interest rate if you have late payments or other negative items added to your credit reports, even if they are completely unrelated to the credit card account. Since credit card debt is unsecured and can be dismissed in a bankruptcy, credit card companies work hard to make sure that if your finances get out of control, they are going to collect as much money from you as possible. Any indication that you might be having trouble making payments and they may start working to offset any future losses.

As you can see, a good credit score opens up a world of opportunities and has benefits many people didn’t even realize were there. On the flip side, a bad credit score can be a huge roadblock causing people to have to work much harder in just about every facet of their finances.

A Good Credit Rating Means More Money in Your Pocket

March 17th, 2020

If it was up to individuals to decide, many people would not take credit for any reason; be it personal or business. While the negative aspects of a debt are mostly felt when the borrower is unable to pay, it is hardly a premeditated scenario. When a financial institution considers a borrower’s credit rating to be good or at least decent, most credit facilities are willing to offer credit facilities. There is so much talk about what is a good credit score, and for most people, strategizing on how to attain it is a daily struggle.

A borrower may feel pressured to repay a credit facility and it may feel like they are denying themselves too much to appear good to the banks but it is all worth it. It might not appear like much of a benefit to oneself, but maintaining a good credit score is good for an individual, at least as far as future financial assistance is concerned. Is it possible to have more just because more effort has been placed to repay a loan, mortgage or credit card debt? The honest answer is YES! A pretty decent credit score is good, but getting a good rating is even better considering the many areas that stand to benefit;

Favorable mortgage rate

Owing to the fact that mortgages are paid over a long period of time, a homeowner gets to spend less money on interest if they pay back to the facility within a shorter duration of time. The interest is paid even lower if the borrower’s credit score is high. According to data made public by MyFico.com, a consumer with an average credit score of 760 or higher would get a mortgage at an interest rate of 3.74%, while another whose score is around 700 got the same facility at 3.96% interest. What is a good credit score? A cheaper mortgage!

Cheaper car loans

A car is a necessity and if there is a way to get it at a lesser value, then getting your credit score is one of them. On average, car loans are given within a vicinity of $26,000 and considering that the average car owner will pay this back within five years, then the interest rates definitely make a difference to the amount of money that is paid back. One can expect to save an average of $598 over the entire period with a good credit score. What is a good credit score if it cannot get you a car at a cheaper cost?

Credit card rewards

Plastic money has been gaining popularity over the last decade and while some people see it as a source of cheap credit, the amount of money spend on the card as interest depends on the average rating of the borrower. The best credit card for good credit offers an annual percentage rate as high as 17% or as low as 13%. The general assumption that lending institutions make is that a borrower with a good rating will clear their debt quickly and the balance at any given time is likely to be low. When marketing their credit card facility as the best credit card for good credit, some lenders will offer 0% interest on credit for the first year to potential customers who have a remarkable rating. This means that people whose credit score is considered poor or average will have to pay an interest rate in the first year of service. Other benefits that the best credit card for good credit owners stands to gain from maintaining good credit scores are free to air miles, loyalty points for using the card and cash back rewards.

Low interest on student loans

Some people are able to finance their own education from savings, sponsorships or even through programs like work-study. These facilities are not always available and the need to get funding from a credit institution may arise when the chance to go back to school presents itself. Loans given to finance education are issued on the basis of credit quality. The higher the credit, the less risky a loan is considered and to factor in this risk, lenders offer corresponding interest rates.

Business financing when needed

Starting a business definitely, costs money and for many entrepreneurs, the only obstacle between them and prosperity is a financial partner who believes in the validity of their business idea. A startup lacks any solid business credit history and lenders find it easier to consider the consumer score in assessing the credit risk. Maintaining a good credit score is therefore not only good for access to financing but qualifying for facilities with low-interest rates.