Jim Kemish asked:


Understanding the World of Credit Scores

Most people are not aware that most credit scores sold online are not the same credit scores that lenders use in making lending decisions. The score used by lenders is called the FICO score and it is the only score that counts. Unfortunately, the companies that sell non-FICO scores do not make it clear that these scores may vary widely from real FICO scores. Worse yet, the three credit bureaus that provide FICO scores to lenders are among the worse offenders in selling non-FICO scores to consumers!

One Score Three Names

The FICO score has been re-branded by each of the three bureaus for their own marketing, hence you will hear of three scores, although they are all driven by the same software. Equifax calls it a BEACON score, TransUnion calls it an EMPIRICA score, and Experian calls it the EXPERIAN/Fair Isaac Risk Model. The scores may be different because each bureau gathers information from a slightly different mix of creditors. If you look at your three reports you will notice that some accounts are missing on each bureau. Timing also plays a roll. A recent change in your credit may be picked up sooner at one bureau than another. You can purchase your real FICO score at MyFico.com.

Improve Your Credit Score Fast

So what makes your FICO score tick? And what can you do about it? Here are a few strategies that everyone involved in the credit repair process should know.

Check Your High Credit Limits

The relationship between your current balance and the available credit limit on your revolving accounts has a major impact on your credit score. Every revolving account on your report should be examined. If the high credit limit is understated send a dispute letter to each of the three credit bureaus asking them to update the information. If you have extra cash, pay down those balances and watch your score go up!

Increase Your High Credit Limits

There is one additional course of action that you should consider that can also reduce the ratio of your current balance to your high credit limit. Call each and every credit card company and ask them to increase your limit. They may or may not agree, but you might be surprised. Please keep in mind that you are doing this to improve your credit. Having a higher credit limit does not mean that you should use it.

Check the Age of Your Accounts

New accounts count against your credit score. Conversely, the credit bureaus will reward you for the accounts that you have maintained over time. When reviewing your three credit reports be sure to look carefully at the initial reporting date for each revolving and installment account. If the age of the account is incorrect on your credit reports send dispute letters to the bureaus. This is a great credit repair trick and well worth the effort.

Resurrect an Old Account

It is not unusual to discover an account on your credit report that you forgot about years ago. If you don’t have much credit please don’t cancel the account. If you no longer have the card in your possession I suggest that you call the company and obtain a replacement card. When you get it you should make a small purchase. The exact algorithm used in the FICO score is a secret, but based on our observations it is best to have some occasional activity on a credit card.

Double Trouble! Eliminate Duplicates

Look at your credit reports carefully. If you see the same account more than once it is probably hurting your score unless it is over three years old with a perfect history and a low balance. If it does not meet these criteria get rid of it now! Collection agencies are notorious for causing duplicate reporting errors. Only one collection agency can own a debt at a time. Essential credit repair tip! If a collection agency no longer owns the debt they are not allowed to report it. That’s the law!

Post Bankruptcy Cleanup

If you have had a bankruptcy you should take action to clean up your credit with all three bureaus immediately upon receiving your discharge. If you don’t feel up to the task of dealing with the paperwork I suggest that you hire a reputable credit repair company. A reputable credit repair company will be inexpensive and be able to do this for you very quickly. If you don’t take action to clean up your credit report it will not happen by itself. A comprehensive post bankruptcy clean up can have a dramatic impact on your credit scores within as little a sixty days after your discharge.

Copyright © 2007 James W. Kemish. All Content. All Rights Reserved.

Juan J .Medina asked:


In today’s finance industry, when applying for a loan, 95% of lenders will submit your application through an automated system. This automated system will determine if you will be approved or not based on your credit scores. Their automated systems do not look at credit history. HMMMM!

Most banks have set rules on how to qualify a borrower for the best loan terms, and those rules almost always place a major emphasis on your credit score. If their best rates are offered to borrowers with a score of 700 or higher and yours is a 697, those three points could cost you thousands of dollars when it comes to financing!

According to http://tinyurl.com/orderFICO , the consumer Web site of the Fair Isaac Corp. that created the FICO score (the most commonly used credit score), the interest rate difference between those two scores is one-half percentage point. You may also enroll for their great monitoring service. Just click on the link.

The good news: You can take steps to improve your credit score by applying easy self help techniques. T

There is several ways and variables that play into an individual score make it impossible to say that one particular action will increase a given score by a certain number of points. Sometimes, I have great results when a borrower pays down a credit card or pays off a collection; other times, it makes very little difference. But there are at least some good guidelines to try and follow.

Here are some tips I’ve picked up along the way:

1. The fastest way to a great score is pay your bills on time, keep account balances low, and take out new credit only when you need it. This is mainly about plain old common sense. People who do these things faithfully usually  have very high scores. To lenders, high scores signify that  you’re being conservative and cautious about credit. In turn, they see you as a lower risk borrower and will reward you with much better terms and a much lower interest rate.

2. What if you’re house hunting and you just need a few extra points to bump you over the line to the great rates? Start by having your mortgage broker, pull your credit report and your credit score to see where you are. If your score is above a 720, you’re golden. Even 700 is going to get you good terms. Improving your score from, say, a 720 to a 740 won’t get you better terms, though, so don’t waste your time doing that. Just continue to follow the guidelines above.

What you’re really looking for on your report are factors that could be negatively affecting your score. Look for errors in the report, such as accounts that aren’t yours, late payments that were actually paid on time, debts you paid off that are shown as outstanding, or old debts that shouldn’t be reported any longer (negatives are supposed to be deleted after seven years, with the exception of bankruptcies, which can stay for as long as 10 years). Every time I meet with a client, I go over their report with them to ensure that the information is correct. I can’t tell you how many times there has been old or downright incorrect information in the report! 75% of credit reports contain errors. Hmmmm!!

You may visit us online and have out team repair your credit at a low cost. Saves you time and headaches. After repairing errors, the fastest route to a better score is paying down balances on credit cards; in my experience, it’s possible to increase your score up to 200 points or more in 90 days  by paying down your credit lines because it helps your debt to credit ratio. 30% of your scores are calculated by how well you manage that area. If you can’t pay them down then you must apply for new credit to offset your debt to credit ratio. What that means is that, the credit scoring system looks at all your credit card limits and your credit card balances and calculates what your credit limit vs. what your balances and shoots out a percentage. So for example, If you have a credit card limits that amount to $10000 and you owe $8000 on them, you are at 80% of the credit limits. Your debt to credit ratio in that case is at 80%. Typically you want to be at 30% or less. If you would like to apply for high credit limits to help your debt to credit rations visit www.ePublishingUSA.com . They approve anyone with a heartbeat. Let all your friends and family know so you can help them with their credit.

3. Had a few late payments in your past? No problem, call Attractive Credit and they may help. Visit Attractive Credit Secrets for self help.

From now on, do your best to pay your bills on time (or ahead of time) and keep your balances as low as possible. After 12 months the scoring module becomes immune to that late and your credit scores are not affected.

4. One thing you shouldn’t do if you’re just trying to boost your score is close unused accounts. If someone tells you to close unused accounts to improve your score, don’t listen. It won’t help you and it can hurt you.

Closing unused accounts without paying down your debt changes your utilization ratio, which is the amount of your total debt divided by your total available credit. You appear closer to maxing out your accounts. That’s why your score can drop. It doesn’t mean people shouldn’t close them, but don’t close them to improve your score.

If you do cut up cards, though, leave the oldest one open! The length of your credit history is another factor in your score. If you close the account of the credit card you got when you were a freshman in college and leave open the ones you just got within the last couple years, it makes you look like a much newer borrower. 

Bottom line:  know that you’re not powerless when it comes to your credit score. There are a lot of things you can do to improve your score and you need to understand what your credit is like now and what’s influencing your score today. Then you can go out and get that amazing interest rate!