Your credit score is governed by your loan-taking and debt-paying habits. The more responsible you are – taking loans if only necessary, avoiding past due dates on our debts, etc. – the better your credit score is.

If you are looking for a tip to increase your credit score, here’s one I can give you: Be healthy.

What has being healthy got to do with your credit score? Well, we know that health care costs have risen significantly over the past few years. The raising costs are due to many factors; one of the most important factors is our lifestyle. Lack of exercises, poor diets by taking foods listed high in glycemic index food list and other unhealthy habits can contribute to weight problems/obesity and any other health problems.

Health-related expenses are often the main culprit why people are taking loans – usually fast approving, high-interest loans, such as payday loans – to cover unexpected health expenses, such as a sudden illness (heart attack, etc.) Those kind of loans are high in interest – about 400% APR – and will put an immediate burden to one’s personal finance. This will impact to your credit score, and to make matter worst, if you are unable to pay on time, you will damage your credit score to a level that it will take years to recover.

So, now you have every reason to do that south beach diet phase 1 – keep yourself healthy is only good for your credit score. It has been proven time and time again.

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10 Tips To Improve Your Credit Score

These days most of us avail loans to buy a house, set up a business, or buy a car. Many students take loans to further their education. How soon the loan is sanctioned, the rate of interest, and the amount sanctioned will all depend on your credit score which is based on your credit report. People with scores of 700 and more are the beneficiaries of lower interest rates and quick sanctions. Imagine if your score is greater than 700 and another person has a score of 698 then the person with score 698 will have to pay interest that is higher by one-half percentage point. And, this means over a year a person with a lower score will pay USD 19,000 and more as interest on a loan of say USD 165,000.

A credit score takes into consideration: payment history, current earnings, current debt, length of credit history, types of credit utilized, and your new credit. If two or more members of your family are earning then apply for a loan jointly.

You can take a few simple steps and ensure that your credit score is higher than 700.

• Maintain a long healthy credit history. Keep alive your oldest credit card and be sure to pay all bills in time. Never keep bills pending over a 30 day period. If in a crunch at least pay the minimum charges due.

• Do not have too many credit cards. Learn to say “NO,” to offers of free credit cards. And, maintain a good credit limit. Avoid using all the available credit on the cards.

• Ensure that the credit report you have is accurate and that there are no errors clerical or otherwise.

• Plan your finance such that it is healthy. Consider debt consolidation.

• Never suddenly close or open accounts. This leads to suspicion that you are trying to manipulate your credit report.

• If you are having problems speak to your creditors well in advance and work out a stage wise repayment. Request the creditor to refrain from reporting the late payment.

• Late or delayed payments drive your score down so always pay bills dead on time. Keep a tab on due dates and ensure that all bills are paid.

Learn all you can about credit reports and scores and keep the criteria in mind while managing your finances. Maintain the debt-to-credit limit ratio and, if need be take the help of a finance planner. A useful source to learn about managing credit is: http://www.balancepro.net/services/index.html they provide in depth coverage on money management, debt management, and credit report review.

Even if advised refrain from filing for bankruptcy. All you need to do is to sit down and curtail expenses, plan you income-expenditure , and avoid spending what you have not earned.

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Five Tips For Improving Your Credit Score

You probably thought once you graduated from school you would be done with report cards. In the adult world, a new type of report card determines whether you’ll be “grounded” or not- it’s your credit report. If your credit score doesn’t meet the “grade”, creditors will ground you and either completely refuse to lend you money or lend you money at extremely high interest rates.

Credit scores are used to measure the probability that you’ll be able to repay the money that you owe, and the score is determined by the information found within your credit report. When you have a top notch credit score, you’ll be rewarded with better interest rates and qualify for more loans- so buying that new car or home can be possible.

Lenders rely on the FICO score through the Equifax credit bureau most often, but there are other credit scores available from Experian and TransUnion credit bureaus as well. You are able to purchase your score at any time so you know where you stand when shopping for a loan, and it’s a good idea to review your credit score and credit report at least twice a year to make sure the information is correct and updated. (You can receive one report from each credit bureau within each 12 month period for free; although FICO scores must be purchased.)

There are 5 things that you can do in order to help improve your creditworthiness and boost your credit score.

Correct mistakes. If there are mistakes and errors in your credit report, chances are your credit score is reflecting a lower score than you should have. Review your credit reports one to two times each year to make sure there are no mistakes on your report.

Be on time. You should make an effort to be on time with your payments all the time, however, if you know you’ll be shopping for some type of credit in the near future, it’s imperative that you make prompt payments in the months close to the time when you will be applying for credit. Recent late payments and missed payments effect your score much more than those that were made several years ago.

Reduce your credit. The FICO score depends a lot upon how much money you owe on credit cards in relation to how much credit you have available to you. A general rule is to try and keep your balances below 25 percent of your total available balance for higher credit scores.

Pay off instead of transferring balances. Many people believe that transferring a balance from one credit card to a new one, and then closing off the card is a good way to increase their credit scores, but that’s not exactly true. When you close one card, you’re actually lowering the ratio of available balance to used balances, and that is likely to lower your credit score. If you’ve got a credit limit on 4 credit cards of ,000, and you owe a total of ,000 that’s 25 percent of your available credit. If you transfer all the balances onto two cards and cancel your other two cards, your total credit available is now only ,000 and you owe ,000- which means you are using 50 percent of your available money and suddenly your credit score is going to decrease.

Keep your unused credit card accounts. If you know you’re going to be applying for credit of some type in the near future, don’t close any of your unused credit card accounts. When you close them, you’re reducing your available balance. Don’t open any new accounts before applying for a loan if you can help it, because having a short credit history on an account lowers your score because there is no real track record of your payments. Having new accounts will also lower the average age of your credit accounts- another large factor of your FICO score.

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Tips to Success in Raising your Credit Score

The number of places that take your credit score into consideration when you want something is increasing geometrically. It is used more and more to evaluate you as a person when you apply for a new job. It is used by many of the car insurance companies to evaluate how much to charge you for car insurance, with alleged statistical proof that those consumers with low credit scores file more claims. And your credit score is used to determine the interest rate when you apply for a loan or a mortgage.

Although this should be common knowledge amongst consumers, it is not for the most part, which is cause for concern. Teens and college students should definitely be aware of how this works, since the use of credit scores is going to become even more prevalent when they get into the outside world.

There are things you can do to raise your credit score. This is not about doing anything illegal or bombarding the credit bureaus with hate mail or threats, but it is simply a matter of having the knowledge of how a credit score is calculated by the credit bureaus, and what steps you can take to allow your credit score to be calculated as a higher number.

When it comes to teaching young people about credit, there’s no shortage of ideas on what to tell them.

A credit score is computed by the credit bureaus based on your credit history and credit profile. Each credit bureau computes a different number for you because they each have a snapshot view of your credit. Not one of them has the complete picture since they do not share information. A credit score is also known as a FICO score, and for most intents and purposes, the two terms are interchangeable.

Things you need to understand about your credit history, your credit usage, and how to improve your credit score would include:

Don’t use credit when you can use cash

Credit cards are sometimes viewed, especially by teens, as free money. There is absolutely nothing free about it. You are paying interest on that money, and the amount of interest you pay is your “rent” for that money. Don’t pay rent if you don’t have to. Studies have also shown that people who buy on credit spend 40-50% more than if they had paid cash, just because they can.

Don’t max out your account

Nothing raises a red flag quicker or lowers your credit score more quickly than having one or more credit cards maxed out or nearly maxed out. This indicates that you are living near your financial edge. If you do carry a balance from month to month, try to keep your outstanding balance to about 25-30% of your credit limit to avoid having negative credit score points applied to your calculation.

Make payments on time consistently

Make 110% sure that you pay your bills on time every month. If your payment is due by the 10th of the month, make sure you mail it by the 3rd or 4th since it will take time to get there by US mail, then be posted to your account. Even better, many banks offer a bill pay service at no charge, so you can go online to make your payment and not even invest in a postage stamp.

Following these tips on a regular basis will help you save money as well as raising your credit score over time. A higher credit score will definitely be worth your time to create.

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Tips to Boost Your Credit Score

We’ve previously discussed how many credit reports contain errors and what impact it has on your credit score. Since your credit score determines stuff like getting good rates on home and auto loans, credit cards, insurance and even employment its important to check your credit report frequently. Here are some tips to help boost your score:

Read your credit report very carefully. Identify anything that isn’t yours. Especially negatives items like late payments, charge-offs and collections. If you do have legitimate collections, make sure they aren’t being reported twice. Sometimes when accounts go to collection the original creditor will list it as a debt as well as the collection agency. Any duplicates must be deleted.

Negotiate bad debts with the creditor and have them deleted. If you have a collection or charge off that’s been out there a while the creditor is likely to settle for a lessor amount and quite possibly delete it from your credit report. Be sure and get something in writing from them stating that they will “delete it” upon receipt of settlement. If you are in the process of buying a home at the time of negotiating a debt, DO NOT TELL THE CREDITOR. They will be less likely to settle for less than what you owe.

Make sure that all of your revolving accounts never carry a balance more than 30% of the available credit. If you have a card with a ,000 limit make sure that the outstanding balance doesn’t float more than 00 for any 30 day period. This tells the world that you aren’t overextended and are in control of your finances. If you’ve maxed a card out already see if the creditor will up your limit. Do not use this extra cushion or you will soon be maxed out again!

Do not close old credit card accounts because these accounts show your established credit history. Keep these accounts open as they tell a story about your stability and pay habits.

If you do not have credit cards and at least one active installment account open some immediately. Go for secured cards if you’ve been turned down for traditional credit cards. The scoring system likes to see three open credit card accounts. Secured cards are an excellent way to establish credit. Typically you make a deposit that is equal to the credit limit. This ensures the bank that you will repay the card each month. Installment loans are things like car loans, appliances and furniture. Getting a mortgage is the ultimate installment loan that will surely boost your credit rating with timely payments.

It takes time to build up a good credit score. Be patient and follow these tips. Remember to check your credit report and credit scores quarterly. These soft credit pulls will not affect your score. Soon you will be on your way to saving sweet moolah through lower interest rates because of your excellent credit score.

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Repairing your Credit Score: Five Tips to Keep your Credit Score Balanced

You know how important is your credit score for the balance of your financial life. Keeping your credit score high will ensure that the interest rates you pay will remain low. It will also make you eligible for all kinds of loans and credit cards. Everyone pays attention to your credit score, your bank, your employer, your landlord, your cell phone company, everybody. Here are some tips to keep your credit score high and balanced.

Ask for a higher credit card limit

Here’s a tip to keep your credit card balance low. The amount of money you owe as a percentage of your total credit limit counts a lot to your credit score. For example if you have a 00 credit limit and your credit card balance is 00 you are at the 50% level, which is relatively high. What you can do to reduce your balance-level is to ask for a higher credit limit. For example if you are approved for a 000 credit limit and you still owe 00, you will automatically move to a 25% balance-level.

Know your credit score status

Find a way to order your credit reports from the credit bureaus, especially if you are not approved for a loan or for a credit limit raise. It is highly likely that there are errors on these reports. These errors are caused by lack of verification of information the credit bureaus receive from the creditors. Take a good look at the reports and look for these errors. It’s up to you to keep your credit report clean so that it will reflect your financial status. You can then write a letter to the credit bureau asking them to correct the errors. Supply any information or documents as proofs.

Build a strong credit history

As time goes by you are building what the experts like to call Credit-History. Your history has a great impact on your credit score. If you have a long history and a positive financial behaviour, then everybody will be more confident and will lend you their money. Therefore it wouldn’t be wise to cancel that old credit cards you don’t use because you found a better deal somewhere else. The accounts associated with old credit cards remain active and there’s a positive credit-history already created for you. Why not use those cards every once in a while to keep the accounts running?

Don’t be fooled by credit repair companies

The best way to repair your credit score is to do it yourself. If you don’t know what to do and you are ready to trust one of the thousands of credit repair companies out there, then you better think twice. More than half of them are a scam. It seems that everyone and their brother establishes such a company. It’s difficult to discover the legitimate ones. Never pay such a company before they provide their services. Always ask information about your legal rights and be aware not to be involved in any illegal activities without even know it.

Make arrangements with the creditors

Sometimes it’s a good idea to talk to your lender about that last late payment. Ask them if it’s possible to erase it from your credit history. Some goodwill will never hurt you and you’ll have the chance to develop a relationship that could be so beneficial for you in the future. If you don’t want to talk to the creditor you can write them a letter and express your request in a polite manner. Remember you’ve got nothing to lose.

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Five Tips to Improve Your Credit Score

If you’re applying for a mortgage or any other kind of loan, it is important to have a solid credit score. If your credit score is low, you’ll be offered a much higher interest rate. If it is extremely low, you might not qualify for a mortgage or other kind of loan at all. Millions of people in the United States have low credit scores, and unfortunately, few people are working to change that. If your credit score is low, do all that you can to begin that climb toward a perfect score. Here are five tips you can use to start on that journey to better credit:

Tip #1: Close old accounts.

When your credit score is figured out, one of the things they take into account is your debt potential. Sure, you might not have much debt today, but if you wanted to, how much debt could you accumulate over the next few hours? For example, if you have three credit cards, each with a limit of ,000, your debt potential is ,000. That’s pretty high, even if you are only carrying balances on two of those cards and the total of those balances is under 0. So, if there are cards you are not using, close them. Don’t forget that store credit cards, like the ones they get you to sign up for in order to get a percentage off of your purchase, also contribute to this debt. Make sure that you close the accounts if you don’t want them – cutting up the card isn’t enough.

Tip #2: Negotiate with lenders to pay old debts.

Are you having trouble paying an old credit card bill or other kind of loan? Maybe you have a 00 doctor bill from five years ago before you had health insurance. Maybe you bought a car and still owe money on it, even though you crashed that car and it is now a pile of scrap metal. These kinds of debts are weighing you down, and it is tempting to pay other bills first and pay these only if you have some extra money lying around. Don’t fall into that trap! Instead, call lenders and work out a payment plan that works for you. If you can’t pay off the debt all at once, ask if they are willing to reduce the debt a bit if you pay it off more quickly. Or, if you can’t afford that, as if they will accept lower monthly payments if you pay a higher interest rate over time. The goal here is to pay your debts on time every month, whatever that payment plan will be.

Tip #3: Check for mistakes.

You should be checking your credit score annually for mistakes. Yes, mistakes happen, even on such an important document as your credit history report. Because of basic human error, numbers get entered incorrectly quite easily. This means that you could be listed as having 0,000 worth of debt instead of ,000 worth of debt! Even worse, if the person enters the social security number incorrectly, you could be listed as having debt when you don’t have any at all. The errors can also come directly from your lenders, or they could be a result of identity theft. No matter how they happened, check your credit score annually to clear up the problems.

Tip #4: Ask for help.

A financial professional is your best bet for raising your credit score significantly. If you’re just not good with money, it might be time to admit that and ask for help. A financial professional and recommend a budget plan that works for you, as well as help you negotiate your bills with lenders or, if it is in your best interest, consolidate your loans.

Tip #5: Avoid foreclosure.

Foreclosure wreaks havoc on your credit score, and that information remains on your credit history for seven years n most cases. Instead of allowing your home to be foreclosed, it is a much better option to try to sell it yourself. That isn’t always possible, be f you foresee money problems in your future, do your best to get your home on the market and sell it in order to repay your own mortgage. It is better than the bank doing it for you!

Of all of the tips above, there is one financial tips that is even better – be proactive about your financial history. Although dealing with money can be difficult, if you are responsible from the start, you should be able to keep your credit score fairly high.

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Do you have a straightforward approach while filling your credit card application

For most of the companies offering credit cards, the applications are somehow identical, inquiring about you and your finances.  It is a good policy to answer their questions truthfully.

Filling in an application for a credit card is normally a boring process.  The company wants details about you and the factors affecting your financial status. This is very important piece of information for these companies as their entire decision process is based on this input.  What they want from you is a true picture of your financial position at a point of time.  Remember the following tips while filling the application form.

Information on your house – owned or rented – This is one of the standard questions.  In the past, the factor of owning of your home was considered more favorably instead of renting.  However due to a sudden increase in the home foreclosures the advantage is diminishing fast.

You need to be honest while answering this question.  You cannot make wrong statement about this and get away with it.  This is not the only factor affecting the approval of your credit card.  You should not hurry to send your application. If you are in the process of moving from a rental house to your own home, wait, close the buying deal and then apply for the credit card.

Your employment status – If you’re unemployed, no need to lie on this point.  You can hold on till you get a job. Your employer may be approached for cross checking. If you’ll feel your income is too low to be eligible to enter credit card, take a part time job in order to increase your income. Details of your household income – This is most popular question on your application.  Your answer will decide whether or not you will get the credit card.  All companies have a requirement of minimum household income.  If you are below this amount, your application will be declined.  Many companies will mention the minimum amount of household income required for successful processing of your application.  It’s not correct to make up a source of income to increase your figure.  You should include only that income which is actually received or receivable.

This category of income includes everything which comes to your home.  If you are receiving some dividends from stocks or income which is from part time jobs or income from your small household business, you should include it.  The more the income, the higher will be your credit limit.

Your debts – You should remember to report all the debts which are legitimately due.  Instead of hiding some debts, tried to pay off small ones, to show a better picture on your application. Information about your previous applications (within past six months or a year) – This is important for the credit card issuing company. Remember, all your applications are entered on your credit report. So the company is going to get this information from that report later. Your incorrect or misleading information will seriously affect your future possibility of getting a credit card.

Every time you apply for a credit card, if will affect your credit score. Every application is recorded in your credit history. So do not apply for many credit cards unnecessarily. After all you will have to pay the balance on them sooner or later!

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6 Tips for Selecting a Credit Counselor

When in deep financial trouble or needing help in planning finances one could opt for seeking professional advice. There are many qualified credit counselors who will offer professional advice after studying a client’s predicament thoroughly.

Although there are many honest counselors one needs to be careful that you do not choose a dummy who lands you in deeper trouble than you already are. According to experts you must:

1. Do your research well before hiring a credit counselor. Get references and check them out.

2. Always find out in detail about fees and services so that you are not faced with any surprises.

3. It is advisable to comparison shop so that you locate a descent and affordable credit counseling service. Never hire companies that ask for huge deposits or unreasonable fees. A debt-management program is to get you out of trouble and not get you into deeper debt or problems.

4. Be sure to ask what the fee covers many credit counselors offer budgeting as well as financial planning for no extra fees. What the professionals will do is map a way out of the debt trap and further until you are in good financial health.

5. It is important to find out how the counseling will take place. In case of credit counseling it is a long drawn out program and may need more than a single meeting.

6. Make the time to do a through background check on the credit counselor or agency you wish to hire. Check with the better business bureau and chamber of commerce as well as bankruptcy course. You will be able to determine how dependable the credit counselor is. Always make the effort to determine whether there are any complaints or pending legal investigations against the credit counselor or agency.

Before you hire an agency or individual to work out a debt management program you must check if the credit counselor has the right qualifications. Find out about accreditations with associations like the Council of Accreditation.

It is advisable to read about credit counseling on the internet especially warnings and alerts issues by the IRS and FTC. See:

http://www.irs.gov/newsroom/article/0,,id=114574,00.html where they recommend:

“Consumers can help protect themselves from deceptive credit counseling practices by following these tips:

* Check that the organization will help you manage your finances better through counseling and education.

* Carefully read through any written agreement that a credit counseling organization offers. It should describe in detail the services to be performed; the payment terms for these services, including their total cost; how long it will take to achieve results; any guarantees offered; and the organization’s business name and address.

*Beware of high fees or required “voluntary contributions” that, with high monthly service charges, may add to your debt and defeat your efforts to pay your bills. It is illegal to represent that negative information, such as bankruptcy, can be removed from your credit report. Promises to “help you get out of debt easily” are a red flag.

*Make sure that your creditors are willing to work with the agency you choose. If they are, follow up with those creditors regularly to make sure your debt is being paid off.

*Check with state agencies and your local Better Business Bureau to find out about a specific credit counseling organization’s record. A list of helpful Web sites appears at the bottom of this release.”

For any program to be a success both you and the credit counselor need patience, trust, and a rapport only then will the debt management program work.

Oh the things I’ll be hearing for commenting on the football game. Eric Nelson is a licensed REALTOR with Keller Williams Integrity Realty. He is a residential real estate expert specializing in the Twin Cities metro area. He can be reached at EricNelson@kw.com.
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Ways to Improve Your Credit Score

If you are cleaning up your credit report you realize how important your score is. This three digit number will directly impact your quality of life.

You will be judged by employers and lenders on this number. It can prevent you from being approved for credit and worse yet being hired for a job.

Many lenders will look at nothing else but your credit score when you apply for new credit. They rarely care as to the reason why a negative mark is on your credit.

There are two parts to credit repair that you should concentrate on.

1. Removing derogatory items from your report.

Negative marks cause the most damage to your score. However you can remove these items without waiting the full 7 years.

The Fair Credit Reporting Act allows you to dispute any negative listing on your credit report. When you file a dispute you are telling the bureaus that this mark is inaccurate or invalid.

In order to file a dispute a dispute letter must be mailed to the credit bureaus. In this letter you need to include an explanation as to why the mark is incorrect. Frequently reasons are; not my account, account paid before sent to collections, item out of date. When the bureaus receive your letter they will investigate the mark.

If the mark can not be verified then the credit bureau must remove it from your report. It has been found that once a listing is investigated it is often removed, regardless of its accuracy.

2. Build positive credit

This is a more difficult aspect. This is because when you have a low credit score it is hard to be approved for new credit lines.

However you need to have a credit line to build positive credit. This will have the most impact if it is an unsecured credit card, even with outrageous interest rates.

With this card you should try to keep the balance at around 10% of the credit limit. This will help your score because it shows you have available credit that is not being used; the bureaus call this your ratio of credit to debt.

In addition making on time monthly payments will create a positive payment history. Without building positive credit it will be hard to improve your score even if you remove all the negative marks.

In sum you can repair your low credit score. It may make sense to wait and remove some of the derogatory items before you apply for new credit. However both these aspects need to be used to get to a 700 credit score.

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