Building credit is actually easier than you might think. It takes a little but of knowledge and the right information and you are on your way to build or acquire credit. Bank institutions always cater to people who have very good credit and they reserve their loans for these people because they are confident that the client will pay back the loan at the specified interest rate. But if you have bad or no credit it can be difficult to get any of these loans for either a home or a car and even if you do get a loan you will be at a ballooned interest rate, sometimes paying almost twice the rate of someone who has good credit.
So what the solution to this? What you should know is that to begin to clean your credit you need to start adding positives to your file, and one of the most prestigious positive lines you can get is a bank loan, even better you can have three at the same time.
To begin you will need about $1000, note that this money is not spent it will be used as collateral to acquire your bank loan. Next you need to find three top banks, consider using Bank of America, Chase bank and Wells Fargo. Once you locate the banks you have know laid the ground work. For the purpose of this article we will label the banks as A,B,C.
Go to Bank A with your $1000 and open a savings account, there should be no problem doing this because most banks will open an account for you without any credit check. Once you have received your bank account go home and wait 3 days. Return to the same bank and tell your bank officer that you want to apply for a loan using your savings account as security.
Most of the time they will issue you this loan with no questions asked but be prepared to answer any questions if they might come, for example you might be asked what the purpose of the money is. You might also be subject to a credit check but you should be given the loan because your savings account will act as security. Make sure you tell your banker that you want the loan amotized for 1 year installment payments. Also your $1000 will be frozen for the loan and as you pay it back monthly the exact amount will be freed up for you. Once you have received the loan go to Bank B open a new account depositing the loan amount.
Once again you will go through the above process again, and do the same for Bank C. Once you are done, you now have 3 top bank loans which you are making payments on every month, and all this will cost you is the price of interest rates
Keyword Articles: http://www.keywordarticles.org
The Asani Wells financial group consists of ex-Bureau employees and agency solicitors who have combined years of knowledge of the credit score system into this easy to read downloadable EBOOK. Please visit www.1800aaacredit.com for more details.
Wednesday, September 2, 2009
Understanding the Ins and Outs of nYour Credit Score
As recent as a few years back, the term "Credit Score" was not very commonly used in our society. While there were who understood the term and its purpose, the mass majority, although realizing that there was a system out there that their credit, they did not have a term to stick to it.
Today, however, due to a number of factors such as increase Identity Theft and mass media marketing campaigns there are very few who are not aware of the term Credit Score. The goal of this article is to add understanding on the personal to the recognition of that term.
A Credit Score is a number between 300 and 850 based on a statistical analysis of an individual's credit activity. It is used to represent the credit worthiness of an individual. How likely that the individual will pay his or her debts. A credit score is based on their credit report information which is typically sourced from credit bureaus and credit reference agencies, typically from the three major credit bureaus.
Lending institutions, such as banks, finance companies, mortgage lenders, and credit card companies, use an individual's Credit Score to evaluate the potential risk posed by lending money to that individual. Lenders use Credit Scores to determine who qualifies for a loan, at what interest rate the loan is issued, and what credit limits are determined.
The use of credit scoring prior to granting credit is a trusted system throughout the industry. Credit scoring is not limited to banks, however. Organizations, such as mobile phone companies and government departments employ the same techniques.
While there are many others, such as NextGen, VantageScore and the CE Score, The most widely known score in the United States is FICO, which is most widely used in the mortgage industry. FICO is an acronym for Fair Isaac Corporation, the company that provides the most well-known and most widely used credit scoring system in the United States.
The FICO score is calculated by applying statistical methods, developed by Fair Isaac, to information in one's credit file and is primarily used in the consumer banking and credit industry. FICO scores show how likely it is that a borrower will default. No public information is available to determine what the scores mean in terms of statistics. A separate score, BNI, is used to indicate likelihood of bankruptcy.
As stated, banks and other lending institutions use Credit Scores as factors in their lending decisions. Whether credit is denied or approved, what interest is charged, what income level and asset verification is required is all based on an individual's credit score.
The FICO score actually uses slightly different scoring methods to rate a consumer's suitability for three different types of credit; mortgages, auto loans, and consumer credit. Each reflecting the different credit risks of these various types of lending. It is not unusual for these scores to differ by as much 50 points or more for the same borrower.
There are three major credit reporting agencies in the United States. Although often times inaccurately referred to as "credit bureaus", these agencies; Equifax, Experian and TransUnion, also calculate their own credit scores. These additional scores differ depending on what they are meant to predict, what statistical methods used to determine a score, and what information is used and how it is weighted.
These additional Credit Scoring Systems are numerous and are agency specific. For example, Beacon, Beacon 5.0, Beacon 96, and Pinnacle scores are available only from Equifax. Empirica, Empirica Auto 95, Precision Score, and Precision 03 are available only from TransUnion. And, Fair Isaac Risk Score at Experian.
These various Credit Scores are developed for the different agencies by Fair Isaac, each differs and are periodically updated to reflect current consumer repayment behavior habits. The NextGen Score is a scoring model designed for consumers.
In an effort to make credit scoring more consistent across the board, in 2006 the big three credit reporting agencies introduced Vantage Score. Vantage Score uses a different number range from the FICO score. It ranges from 501 to 990 and also assigns letter grades from A to F to specific ranges of scores.
A consumer's Vantage Score may differ from agency to agency, but the difference would be entirely due to differences in the information reported to the various agencies, not due to differences in scoring systems. Since FICO is still widely used by lenders, the agencies continue to offer FICO scores (or their closest equivalent) as well.
Most credit scores use a multiple-scorecard design. Each version may use individual scorecards, and an individual potential borrower is typically compared with other previous borrowers. In other words, a borrower with one 30-day late payment will be scored against a population with some similar delinquency. A borrower with two 30-day late payments will be scored against a population with like credit faults. The individual is then graded according to which variables indicate a risk within that group.
Nearly all large banks also build and use their own systems for credit scoring purposes, and are often times in conjunction with outside scoring formulas.
The systems used to generate credit scores are subject to federal regulations. The Federal Reserve Board's Regulation B, which implements the Equal Credit Opportunity Act, expressly prohibits a credit scoring system from considering any "prohibited basis" such as race, color, religion, national origin, sex, or marital status. It also stipulates that credit scoring systems must be "empirically derived" and "statistically sound".
In addition, if an adverse action, a denial of a credit application, is taken as a result of the credit score then the specific reasons for the denial must be provided to the individual denied. The statement "credit score not high enough" is insufficient. The reasons for denial must be specific; "too many delinquencies 60 days or greater" and such.
Credit scores are designed to measure the risk of default by taking into account various factors in a person's financial history. Although the exact formulas for calculating credit scores are closely guarded secrets, the Fair Isaac Corporation has disclosed the following components and the approximate weighted contribution of each:
35% punctuality of payment in the past (30 Days Past Due)
30% the amount of debt, expressed as the ratio of current revolving debt to total available revolving credit
15% length of credit history
10% types of credit used
10% recent search for credit and/or amount of credit obtained recently
These percentages offer a limited guidance in understanding a credit score. For example, the 10% of the score allocated to "types of credit used" is undefined, leaving consumers unaware what type of credit mix to pursue. "Length of credit history" is also a murky concept; it consists of multiple factors two being the oldest account open and the average length of time an account has been open.
Interestingly, although only 35% is attributed to punctuality, if a consumer is substantially late on numerous accounts, his score will fall far more than 35%. Bankruptcies, foreclosures, and judgments affect scores substantially, but are not included in the very vague pie chart provided by Fair Isaac.
A FICO score generally has a max of 850 and a minimum of 300. It exhibits a left-skewed distribution with a median around 723. The performance of the scores is monitored and the scores are periodically aligned so that a lender normally does not need to be concerned about which score card was employed.
Because the three major credit agencies have their own, independent databases, each of us actually has three credit scores for any given scoring system. As these databases are independent of each other, they may contain entirely different data. Many lenders will check an applicant's score from each bureau and use the median score to determine the applicant's credit worthiness.
As a result of the FACT Act (Fair and Accurate Credit Transactions Act), each legal U.S. resident is entitled to one free copy of his or her credit report from each credit reporting agency once every twelve months. To guard against inaccurate information or fraud more often than yearly, one can request a report from a different credit reporting agencies available on the net. This information is available from a number of websites across the net that offer an free credit report and use of their services for 30 days. After which, there is a monthly fee involved. The fee is nominal compared to the necessity of protecting your credit in today's highly technological society where identity theft is becoming more prevalent.
In a time where identity theft and credit fraud in on the rise, the fee these firms charge seems like a small amount to pay to protect your credit and your good name. Having a good Credit Score is becoming more and more prevalent in our society. Here are a few examples of how:
In September 2004, TXU (a Texas utility company) announced it would begin setting individualized electricity prices based on credit score. However, due to negative press and pressure from the Texas Public Utility Commission, the plan was not implemented.
Credit scores are often used in determining prices for auto and homeowner insurance. Recently, some of the agencies that generate credit scores have also been generating more specialized insurance scores, which insurance companies then use to rate the quality of potential customers. These scores are unavailable to consumers.
Many employers reserve the right to do a credit check of job applicants, in the same manner they reserve the right to drug test potential employees. the fact is that your Credit Score is important. Rebuild-Credit.us is a sight committed to providing consumers with quality information concerning credit, how to get it, and how to maintain a quality credit score. It is recommended you take the time to visit them and read through the numerous articles and reports there.
Keyword Articles: http://www.keywordarticles.org
Peter Bolduc is the Managing Editor for Rebuild-Credit.us a site committed to assisting consumers in obtaining and maintain a quality credit score.
Submitted by: Super Article Submitter
Today, however, due to a number of factors such as increase Identity Theft and mass media marketing campaigns there are very few who are not aware of the term Credit Score. The goal of this article is to add understanding on the personal to the recognition of that term.
A Credit Score is a number between 300 and 850 based on a statistical analysis of an individual's credit activity. It is used to represent the credit worthiness of an individual. How likely that the individual will pay his or her debts. A credit score is based on their credit report information which is typically sourced from credit bureaus and credit reference agencies, typically from the three major credit bureaus.
Lending institutions, such as banks, finance companies, mortgage lenders, and credit card companies, use an individual's Credit Score to evaluate the potential risk posed by lending money to that individual. Lenders use Credit Scores to determine who qualifies for a loan, at what interest rate the loan is issued, and what credit limits are determined.
The use of credit scoring prior to granting credit is a trusted system throughout the industry. Credit scoring is not limited to banks, however. Organizations, such as mobile phone companies and government departments employ the same techniques.
While there are many others, such as NextGen, VantageScore and the CE Score, The most widely known score in the United States is FICO, which is most widely used in the mortgage industry. FICO is an acronym for Fair Isaac Corporation, the company that provides the most well-known and most widely used credit scoring system in the United States.
The FICO score is calculated by applying statistical methods, developed by Fair Isaac, to information in one's credit file and is primarily used in the consumer banking and credit industry. FICO scores show how likely it is that a borrower will default. No public information is available to determine what the scores mean in terms of statistics. A separate score, BNI, is used to indicate likelihood of bankruptcy.
As stated, banks and other lending institutions use Credit Scores as factors in their lending decisions. Whether credit is denied or approved, what interest is charged, what income level and asset verification is required is all based on an individual's credit score.
The FICO score actually uses slightly different scoring methods to rate a consumer's suitability for three different types of credit; mortgages, auto loans, and consumer credit. Each reflecting the different credit risks of these various types of lending. It is not unusual for these scores to differ by as much 50 points or more for the same borrower.
There are three major credit reporting agencies in the United States. Although often times inaccurately referred to as "credit bureaus", these agencies; Equifax, Experian and TransUnion, also calculate their own credit scores. These additional scores differ depending on what they are meant to predict, what statistical methods used to determine a score, and what information is used and how it is weighted.
These additional Credit Scoring Systems are numerous and are agency specific. For example, Beacon, Beacon 5.0, Beacon 96, and Pinnacle scores are available only from Equifax. Empirica, Empirica Auto 95, Precision Score, and Precision 03 are available only from TransUnion. And, Fair Isaac Risk Score at Experian.
These various Credit Scores are developed for the different agencies by Fair Isaac, each differs and are periodically updated to reflect current consumer repayment behavior habits. The NextGen Score is a scoring model designed for consumers.
In an effort to make credit scoring more consistent across the board, in 2006 the big three credit reporting agencies introduced Vantage Score. Vantage Score uses a different number range from the FICO score. It ranges from 501 to 990 and also assigns letter grades from A to F to specific ranges of scores.
A consumer's Vantage Score may differ from agency to agency, but the difference would be entirely due to differences in the information reported to the various agencies, not due to differences in scoring systems. Since FICO is still widely used by lenders, the agencies continue to offer FICO scores (or their closest equivalent) as well.
Most credit scores use a multiple-scorecard design. Each version may use individual scorecards, and an individual potential borrower is typically compared with other previous borrowers. In other words, a borrower with one 30-day late payment will be scored against a population with some similar delinquency. A borrower with two 30-day late payments will be scored against a population with like credit faults. The individual is then graded according to which variables indicate a risk within that group.
Nearly all large banks also build and use their own systems for credit scoring purposes, and are often times in conjunction with outside scoring formulas.
The systems used to generate credit scores are subject to federal regulations. The Federal Reserve Board's Regulation B, which implements the Equal Credit Opportunity Act, expressly prohibits a credit scoring system from considering any "prohibited basis" such as race, color, religion, national origin, sex, or marital status. It also stipulates that credit scoring systems must be "empirically derived" and "statistically sound".
In addition, if an adverse action, a denial of a credit application, is taken as a result of the credit score then the specific reasons for the denial must be provided to the individual denied. The statement "credit score not high enough" is insufficient. The reasons for denial must be specific; "too many delinquencies 60 days or greater" and such.
Credit scores are designed to measure the risk of default by taking into account various factors in a person's financial history. Although the exact formulas for calculating credit scores are closely guarded secrets, the Fair Isaac Corporation has disclosed the following components and the approximate weighted contribution of each:
35% punctuality of payment in the past (30 Days Past Due)
30% the amount of debt, expressed as the ratio of current revolving debt to total available revolving credit
15% length of credit history
10% types of credit used
10% recent search for credit and/or amount of credit obtained recently
These percentages offer a limited guidance in understanding a credit score. For example, the 10% of the score allocated to "types of credit used" is undefined, leaving consumers unaware what type of credit mix to pursue. "Length of credit history" is also a murky concept; it consists of multiple factors two being the oldest account open and the average length of time an account has been open.
Interestingly, although only 35% is attributed to punctuality, if a consumer is substantially late on numerous accounts, his score will fall far more than 35%. Bankruptcies, foreclosures, and judgments affect scores substantially, but are not included in the very vague pie chart provided by Fair Isaac.
A FICO score generally has a max of 850 and a minimum of 300. It exhibits a left-skewed distribution with a median around 723. The performance of the scores is monitored and the scores are periodically aligned so that a lender normally does not need to be concerned about which score card was employed.
Because the three major credit agencies have their own, independent databases, each of us actually has three credit scores for any given scoring system. As these databases are independent of each other, they may contain entirely different data. Many lenders will check an applicant's score from each bureau and use the median score to determine the applicant's credit worthiness.
As a result of the FACT Act (Fair and Accurate Credit Transactions Act), each legal U.S. resident is entitled to one free copy of his or her credit report from each credit reporting agency once every twelve months. To guard against inaccurate information or fraud more often than yearly, one can request a report from a different credit reporting agencies available on the net. This information is available from a number of websites across the net that offer an free credit report and use of their services for 30 days. After which, there is a monthly fee involved. The fee is nominal compared to the necessity of protecting your credit in today's highly technological society where identity theft is becoming more prevalent.
In a time where identity theft and credit fraud in on the rise, the fee these firms charge seems like a small amount to pay to protect your credit and your good name. Having a good Credit Score is becoming more and more prevalent in our society. Here are a few examples of how:
In September 2004, TXU (a Texas utility company) announced it would begin setting individualized electricity prices based on credit score. However, due to negative press and pressure from the Texas Public Utility Commission, the plan was not implemented.
Credit scores are often used in determining prices for auto and homeowner insurance. Recently, some of the agencies that generate credit scores have also been generating more specialized insurance scores, which insurance companies then use to rate the quality of potential customers. These scores are unavailable to consumers.
Many employers reserve the right to do a credit check of job applicants, in the same manner they reserve the right to drug test potential employees. the fact is that your Credit Score is important. Rebuild-Credit.us is a sight committed to providing consumers with quality information concerning credit, how to get it, and how to maintain a quality credit score. It is recommended you take the time to visit them and read through the numerous articles and reports there.
Keyword Articles: http://www.keywordarticles.org
Peter Bolduc is the Managing Editor for Rebuild-Credit.us a site committed to assisting consumers in obtaining and maintain a quality credit score.
Submitted by: Super Article Submitter
Structured Settlement Broker
Personal injury cases are always very emotional things. There is the injured party that deserves compensation, and the defendant that doesn't want to pay it. Unfortunately, a win for the injured party does not always mean that compensation will occur immediately. In many cases, having a structured settlement is the best way to have the money paid to the injured party.
Why Have A Structured Settlement?
If you have an injury that is going to require extensive hospital services or a long time out of work, you may want to have your money coming in a bit at a time, instead of all at once. This way you can keep things more stable and continue paying your bills, instead of having to worry about having money in the long run. A structured settlement broker is the person to see if you want to change your win into a structured settlement payment.
There are a few different ways that your payments may wind up structured settlements. One is if the judge in the case decrees that payments will be made in a specific way. Often, judges ask for payments to be made monthly to the injured party so that they can continue to take care of bills and hospital charges. The other way to get set payments out of the money owed to you is to have a structured settlement broker sell your claim to a company that specializes in purchasing structured settlements.
The Structured Settlement Broker
Understanding the costs and the financial situation is the job of the structured settlement broker. A good structured settlement broker should help the parties understand the costs and come up with a financial analysis. Dealing with the numbers is the job of the structured settlement broker. An experienced broker understands how the settlement process works and will be able to work with the payee much more efficiently than someone who has no experience in structured settlement matters.
When To Sell Your Settlement
When wondering if you should sell your structured settlement, you need to ask yourself why you want to. If you have a large amount of bills that need to be paid, or if you'd like to have the security of owning your own home, you may want to think about contacting a structured settlement broker in order to find a company to purchase your settlement. When it comes down to it, the money that is due to you is, in the end, yours. Why shouldn't you have it paid to you in a way that is convenient?
When it comes down to getting a structured settlement, a good, proven structured settlement broker is the best way to go. They have access to multiple buyers and will be able to obtain a number of different quotes, so that you can choose which deal ultimately works the best for you. Don't be afraid to check out their reputation online, or at the Better Business Bureau. After all, it's your money, so you want to be comfortable with the company that you choose to use!
Keyword Articles: http://www.keywordarticles.org
Scott Schwarts scott is sales director at WoodBridge Investments. Woodbridge Investments is a specialty finance company that provides lump sum payments to individuals. Visit today www.woodbridgeinvestments.com
Why Have A Structured Settlement?
If you have an injury that is going to require extensive hospital services or a long time out of work, you may want to have your money coming in a bit at a time, instead of all at once. This way you can keep things more stable and continue paying your bills, instead of having to worry about having money in the long run. A structured settlement broker is the person to see if you want to change your win into a structured settlement payment.
There are a few different ways that your payments may wind up structured settlements. One is if the judge in the case decrees that payments will be made in a specific way. Often, judges ask for payments to be made monthly to the injured party so that they can continue to take care of bills and hospital charges. The other way to get set payments out of the money owed to you is to have a structured settlement broker sell your claim to a company that specializes in purchasing structured settlements.
The Structured Settlement Broker
Understanding the costs and the financial situation is the job of the structured settlement broker. A good structured settlement broker should help the parties understand the costs and come up with a financial analysis. Dealing with the numbers is the job of the structured settlement broker. An experienced broker understands how the settlement process works and will be able to work with the payee much more efficiently than someone who has no experience in structured settlement matters.
When To Sell Your Settlement
When wondering if you should sell your structured settlement, you need to ask yourself why you want to. If you have a large amount of bills that need to be paid, or if you'd like to have the security of owning your own home, you may want to think about contacting a structured settlement broker in order to find a company to purchase your settlement. When it comes down to it, the money that is due to you is, in the end, yours. Why shouldn't you have it paid to you in a way that is convenient?
When it comes down to getting a structured settlement, a good, proven structured settlement broker is the best way to go. They have access to multiple buyers and will be able to obtain a number of different quotes, so that you can choose which deal ultimately works the best for you. Don't be afraid to check out their reputation online, or at the Better Business Bureau. After all, it's your money, so you want to be comfortable with the company that you choose to use!
Keyword Articles: http://www.keywordarticles.org
Scott Schwarts scott is sales director at WoodBridge Investments. Woodbridge Investments is a specialty finance company that provides lump sum payments to individuals. Visit today www.woodbridgeinvestments.com
2 Things To Do In 30min To Raise Your Credit Scores 40-100 Points
Let me start off by saying that understanding how the three major credit bureaus arrive at your credit score is one of the most powerful pieces of knowledge you can have. Most likely this is not something that you have ever been taught. In fact, when it comes to your credit scores, the three major credit bureaus, Equifax, Experian, and Transunion, run sort of a "black box" operation.
To explain what makes up your credit score in as simple terms possible, this is how it works
Your Payment History (35%) Makes up the largest factor in determining your score. This is a picture of how you pay your bills.
Credit Utilization 30%: The percentage of available credit used. Keeping your account balances below 50% of the available credit limit will maximize your scores. For the purpose of this article, this is where we will find the most room to quickly increase your scores.
Credit History 15%: A more seasoned account carry more weight than one that was just opened.
Inquiries 10%: When you apply for credit, an inquiry is made to your credit. If you have too many inquiries, your score can be negatively effected.
Credit Types In Use 10%: The number of accounts in use, and the type of credit accounts. Finance company accounts are of the lowest value, and too many of them can cause a negative effect on your scores.
Ok, now we have some powerfull knowledge. It's time to put it to use with 2 things we can do in about 30 minutes to increase our credit scores...
Increase your credit limits: This is actually easier than you think. It is truly remarkable what will be granted to you simply for the asking. What I want you to do is simply call each of your credit card companies and ask them to increase your credit limit. One technique you might also use is to tell them you are doing some financial house-cleaning and are considering getting rid of the card and using one with a higher limit and better interest rate, unless they can give you a better offer. In my experience, I have found this to be successfull 100% of the time.
Here is an example of what can be achieved. You have a credit card with a balance of $4,000 and a limit of $5,000. This means you are 80% utilized. After using the above technique, your limit is raised to $6,500. Now you are only 62% utilized. Immediately your credit scores have increased. Keep in mind that we want to ideally keep our balances at 50% or lower compared to our credit limits. This segways to the next tip.
Lowering your balances to add more points. Continued from the above example, you are now utilized at 62% on your credit card. What this means is that you still have room to further increase your scores. If you coule put just $750 on this credit card, you could bring the current balance to 50% of your new credit limit ($6,500 credit limit, with a balance of $3,250). You might be saying that you don't have $750 to put down on your credit card. Ok, you could stop right here, since you already increased your scores, and you can most likely get the limit raised for all your credit card accounts. However, if you are trying to buy a home, or a new car, you can potentially save thousands, or even tens of thousands in interest on that new loan and even get a lower monthly payment, just by paying a little down on your current accounts. When that results in higher credit scores, you may qualify for much better loan terms. In one case, a client paid down $450 on one credit card and was able to increase their scores so they could purchase their new home with zero down, instead of the $5,200 required down payment they were previously facing.
If you use these powerful techniques, you are sure to increase your scores quickly and easily. I have seen it work over and over. One recent client was able to increase their credit scores by 105 points after getting the credit limits raised on all three of their credit cards in less than 30 minutes. You have nothing to lose by making a couple calls.
Keep in mind that these techniques work best for those who have a good credit history, and at least 3 open, established credit accounts. For those with more challenged credit or a negative credit history, a more aggressive approach and credit repair strategies may be more appropriate.
Keyword Articles: http://www.keywordarticles.org
Jon Ochs has over 12 years of experience in the credit and debt field and is the founder/CEO of NCA Credit Repair, one of the most trusted and respected Credit Report Repair companies in the nation.
To explain what makes up your credit score in as simple terms possible, this is how it works
Your Payment History (35%) Makes up the largest factor in determining your score. This is a picture of how you pay your bills.
Credit Utilization 30%: The percentage of available credit used. Keeping your account balances below 50% of the available credit limit will maximize your scores. For the purpose of this article, this is where we will find the most room to quickly increase your scores.
Credit History 15%: A more seasoned account carry more weight than one that was just opened.
Inquiries 10%: When you apply for credit, an inquiry is made to your credit. If you have too many inquiries, your score can be negatively effected.
Credit Types In Use 10%: The number of accounts in use, and the type of credit accounts. Finance company accounts are of the lowest value, and too many of them can cause a negative effect on your scores.
Ok, now we have some powerfull knowledge. It's time to put it to use with 2 things we can do in about 30 minutes to increase our credit scores...
Increase your credit limits: This is actually easier than you think. It is truly remarkable what will be granted to you simply for the asking. What I want you to do is simply call each of your credit card companies and ask them to increase your credit limit. One technique you might also use is to tell them you are doing some financial house-cleaning and are considering getting rid of the card and using one with a higher limit and better interest rate, unless they can give you a better offer. In my experience, I have found this to be successfull 100% of the time.
Here is an example of what can be achieved. You have a credit card with a balance of $4,000 and a limit of $5,000. This means you are 80% utilized. After using the above technique, your limit is raised to $6,500. Now you are only 62% utilized. Immediately your credit scores have increased. Keep in mind that we want to ideally keep our balances at 50% or lower compared to our credit limits. This segways to the next tip.
Lowering your balances to add more points. Continued from the above example, you are now utilized at 62% on your credit card. What this means is that you still have room to further increase your scores. If you coule put just $750 on this credit card, you could bring the current balance to 50% of your new credit limit ($6,500 credit limit, with a balance of $3,250). You might be saying that you don't have $750 to put down on your credit card. Ok, you could stop right here, since you already increased your scores, and you can most likely get the limit raised for all your credit card accounts. However, if you are trying to buy a home, or a new car, you can potentially save thousands, or even tens of thousands in interest on that new loan and even get a lower monthly payment, just by paying a little down on your current accounts. When that results in higher credit scores, you may qualify for much better loan terms. In one case, a client paid down $450 on one credit card and was able to increase their scores so they could purchase their new home with zero down, instead of the $5,200 required down payment they were previously facing.
If you use these powerful techniques, you are sure to increase your scores quickly and easily. I have seen it work over and over. One recent client was able to increase their credit scores by 105 points after getting the credit limits raised on all three of their credit cards in less than 30 minutes. You have nothing to lose by making a couple calls.
Keep in mind that these techniques work best for those who have a good credit history, and at least 3 open, established credit accounts. For those with more challenged credit or a negative credit history, a more aggressive approach and credit repair strategies may be more appropriate.
Keyword Articles: http://www.keywordarticles.org
Jon Ochs has over 12 years of experience in the credit and debt field and is the founder/CEO of NCA Credit Repair, one of the most trusted and respected Credit Report Repair companies in the nation.
Subscribe to:
Posts (Atom)