asked:


We have about $100K in credit card debt. I’m trying to get it under control, however, I’m back in the same big hole every month due to interest. I have looked into credit counseling services, everyone wants to charge you some large fee for negotiating with credit card companies. I want to try to do this myself. Does anyone have any suggestions, points or tips for doing this?

Floyd Dorrance asked:


Have you ever wondered what exactly is up with”credit score”? This informative report can give you an insight into everything you’ve ever wanteto know about “credit score”.

Having a good credit score is very important in today’s society. It is something that many people should have. By having a good credit score,

applying for loans and unsecured credit cards is much easier.

If you already have a good credit score, you will want to raise it in order to obtain the best loan and credit card deals possible. If you have a credit score of 688 and the loan company will reduce interest rates if you get a credit score of 690. The two points can mean thousands of dollars in savings.

This is why it is very important for you toimprove your credit score even if you already have a good credit score. It will mean lower interest rates and also more chances of getting the loans you need.

There are several ways you can improve your credit score. Some ways take time to achieve and some take only a few weeks or even a few days to do. If you start working on it as soon as possible, you will see that it will be worth all the effort.

So, here are some of the ways you can raise your credit score.

The first method for raising your credit score is to check credit reports for errors. Even minor errors can hurt your credit rating.

Now that we’ve covered those aspects of “credit score”, let’s turn to some of the other factors that need to be considered.

If you ever suspect that your low credit score is caused by an error, you should contact the credit reporting agencies and challenge them about the report. It is part of the law that the reporting agency should investigate and correct the errors within thirty days if there is any.

The next step on how you can raise your credit score is to pay off your balances every month. This can keep you out of debt and save a lot of

money on interest rate. Also, this will demonstrate that you can manage your debt effectively and increase your credit score.

By having only a few credit cards, two at most, will boost your credit score. Having five or more credit cards will in fact, lower your credit score. This is why it is important for you to have only two credit cards.

If you borrowed money before, it is important for you to pay it on time. This will have a positive impact on your credit score because it will show credit reporting agencies and also creditors that you can manage your debt effectively. However, if you have borrowed money before and is long overdue, you should pay it immediately. In time,

these old late payments will be deemed unimportant and it will expire.

Another way to raise your credit score is by managing your credit cards effectively. Don’t use your entire credit limit on each of the credit

cards you own. For example, if you have credit cards with a credit limit of 2000, 2500 and 3000 dollars, it is better to use 600 dollars on each card rather than 1800 dollars in one card. Always keep one thing in mind; it is best for your credit score if you only use less than 50% of your credit card limit.

These are some of the methods you can use to raise your credit score.

Following all these will ensure you that your credit score will increase and will result in better opportunities in the future.

Now might be a good time to write down the main points covered above.

The act of putting it down on paper will help you remember what’s important about “credit score”.

Cornie Herring asked:


Have you check your credit score? Do you know how high your credit score is? Many people only pay attention to their credit score when they need it for any credit application. If you just realize you have low credit score at the time you need it for a loan or credit application, it might not help in getting the best rate because the best interest rate of any loan or credit always offer to the person with high credit score and time is needed to rebuild your low credit score. Hence, it’s better to pay attention to your credit score now and put your efforts to improve it if you found it low.

The three major credit bureaus: Equifax, Experian and TransUnion collect data from your lenders about your history of borrowing and paying back credit. The information is then being compiled into your credit reports. The company like FICO will then takes the information from your credits and applied a trade-secret formula to produce one score ranging from 300 to 850 based on your credit history. The more excellent of your credit history, the higher credit score you will get.

Top tier scores are range from 760 to 850. People who fall into the top tier scores are expected to get the lower interest rates as they are categorized as the lowest risk group by the lenders and this group has more choices to select their favorite loan package with more attractive offers. In general, a score about 500 to520 is the lowest acceptance level for many lenders to approve any loan or mortgage application. If your credit score is fall in this low acceptance range, you can be expected to be quoted significantly higher interest rates and may be offered with fewer varieties of loan offers. Any score below 500 has very low chances to be approved for any credit unless you go for secured loan.

Example below will give you a better picture on how the credit score will affect the interest rates of credit:

760 to 850 tier: Interest rate = 5.78%

700 to 759 tier: Interest rate = 6.00%

660 to 699 tier: Interest rate = 6.30%

620 to 659 tier: Interest rate = 7.10%

580 to 619 tier: Interest rate = 8.58%

500 to 579 tier: Interest rate = 9.50%

Let assume if you credit score is top tier (760 to 850) and you care being approved for $100,000 mortgage with 30 years term; the total interest for this $100,000 mortgage over 30 years is $110,772. Whereas, if your credit score is at bottom tier (500 to 579), the same $100,000 mortgage, the total interest over 30 years will be $202,709. You are paying about $92,000 extra interest just because your credit score is at bottom tier as compare to if you credit score is at top tier. That’s why you need to get the highest possible credit score so that you can save more money in term of interest for any credit you apply for.

Even your credit score is not as bad as fall into the bottom tier, as long as your credit score is not in the top tier, it worth for you to work it out to improve your credit score so that your credit score is fall into the 760 to 850 range so that you have more options to get the best offers whenever you need to apply for a credit.

Summary

Lenders measure your credit history based on credit score, the higher credit score the lower risk as seen by the lenders and you are at a better position to get better credit offers. Hence, it worth for you to improve your credit score if you r score is not fall into the top tier range.

keith williams asked:


Improving your credit score is very important and simple to do. Some people feel like giving up on situations like this not knowing the easy steps and procedures it takes to get on the right track to boost their credit score. You can get on the right track by simply taking these 8 tips to improve your credit score.

Tip #1 Understand where credit scores come from.

If you are going to improve your credit score, then logic has it that you must understand what your credit score is and how it works. Without this information, you won’t be able to very effectively improve your score because you won’t understand how the things you do in daily life affect your score.

If you don’t understand how your credit score works, you will also be at the mercy of any company that tries to tell you how you can improve your score – on their terms and at their price.

In general, your credit score is a number that lets lenders know how much of a credit risk you are. The credit score is a number, usually between 300 and 850, that lets lenders know how well you are paying off your debts and how much of a credit risk you are.

In general, the higher your credit score, the better credit risk you make and the more likely you are to be given credit at great rates. Scores in the low 600s and below will often give you trouble in finding credit, while scores of 720 and above will generally give you the best interest rates out there. However, credit scores are a lot like GPAs or SAT scores from college days while they give others a quick snapshot of how you are doing, they are interpreted by people in different ways. Some lenders put more emphasis on credit scores than others.

Tip #2 Keep the contact information for credit bureaus handy.

The three major credit bureaus are important to contact if you are going to be repairing your credit score. The major three credit agencies can help you by sending you your credit report. If you find an error on your credit report, these are also the companies you must contact in order to correct the problem. You can easily contact these organizations by mail, telephone, or through the Internet

Equifax Credit Information Services, Inc Address: P.O. Box 740241

Atlanta, GA 30374

Telephone 1 888 766 0008

TransUnion LLC Consumer Disclosure Center Address: P.O. Box 1000

Chester, PA 19022

Telephone 1 800 888 4213

Experian National Consumer Assistance Center Address: PO Box 2002

Allen, TX 75013

Telephone 1 888 397 3742

You may want to note this information wherever most of your financial information is kept so that you can easily contact the bureaus whenever you need to. Your local yellow pages should also have the contact information of these credit agencies as well.

Tip #3 Develop an action plan for dealing with your credit score.

Once you have your credit report and your credit score, you will be able to tell where you stand and where many of your problems lie. If you have a poor score, try to see in your credit report what could be causing the problem:

Do you have too much debt?

Too many unpaid bills?

Have you recently faced a major financial upset such as a bankruptcy?

Have you simply not had credit long enough to establish good credit?

Have you defaulted on a loan, failed to pay taxes, or recently been reported to a collection agency?

Tip #4 Pay your bills on time.

One of the best ways to improve your credit score is simply to pay your bills on time. This is absurdly simple but it works very well, because nothing shows lenders that you take debts seriously as much as a history of paying promptly. Every lender wants to be paid in full and on time.

If you pay all your bills on time then the odds are good that you will make the payments on a new debt on time, too, and that is certainly something every lender wants to see. Experts think that up to 35% of your credit score is based on your paying of bills on time, so this simple step is one of the easiest ways to boost your credit score.

Tip #5 Avoid excessive credit.

If you have many lines of credit or several huge debts, you make a worse credit risk because you are close to “overextending your credit.” This simply means that you may be taking on more credit than you can comfortably pay off. Even if you are making payments regularly now on existing bills, lenders know that you will have a harder time paying off your bills if your debt load grows too much.

The higher your debts the greater your monthly debt payments and so the higher the risk that you will eventually be able to repay your debts. Plus, statistical studies have shown that those with high debt loads have the hardest time financially when faced with a crisis such as a divorce, unemployment, or sudden illness.

Tip #6 Pay Down Your Debts

If you have a lot of debt, your credit score will suffer. Paying down your debts to a minimum will help elevate your credit score. For example, if you have a $1000 limit on your credit card and you regularly carry a balance of $900, you will be a less attractive credit risk to lenders than someone who has the same credit card but carries a smaller balance of $100 or so. If you are serious about improving your credit score, then start with the largest debt you have and start paying it down so that you are using a less large percentage of your credit total.

In general, try to make sure that you use no more than 50% of your credit. That means that if your credit card has a limit of $5000, make sure that you pay it down to at least $2500 and work at carrying no larger balance. If possible, reduce the debt even more. If you can pay off your credit card in full each month, that is even better. What counts here is what percentage of your total credit limit you are using – the lower the better.

Tip #7 Have a range of credit types.

The types of credit you have are a factor in calculating your credit score. In general, lenders like to see that you are able to handle a range of credit types well. Having some form of personal credit such as credit cards and some larger types of credit such as a mortgage or auto loan and paying them off regularly is better than having only one type of credit.

Tip #8 Look out for identity theft.

Many people who are careful about paying bills on time and having minimal debts are shocked each year to find that they have low credit scores. In many cases, this happens as a result of identity theft. Identity theft is a type of crime in which people take your personal information and steal that information to pose as you in order to get access to your accounts or identity.

For example, someone with your PIN numbers can remove small amounts of money from your bank account each month or someone can use your name and personal information to get credit cards in your name and use those credit cards with no intention of paying back the money. You are stuck with the large debts and the poor credit score.

To prevent identity theft, always check your account statements carefully each month. Report any suspicious activity or any charges you don’t recognize at once. Also check your credit report regularly and immediately investigate any new credit accounts you do not recognize – this is the best way of detecting and acting on identity theft.

Lisa Phillips asked:


Millions of consumers have less than perfect credit and it can be frustrating. Credit has permeated our society and having low credit scores costs you money. Credit scores are the No. 1 determinant in a bank’s decision to approve or decline credit. You may be approved for credit even though your scores are low but you will undoubtedly pay higher interest rates. The following are tips to begin rebuilding your credit:

(1) Authorized Buyer or Piggyback Credit. Becoming an authorized buyer also known as piggyback credit can be an instant way to boost your credit score. If you know someone who has a good credit history and score and is willing to add you to their account, this can immediately raise your credit score. There are companies that provide authorized buyer accounts for a fee. The credit card company will report to your credit files as well as the card holders’. The downfall of becoming an authorized buyer is that if the person ever becomes delinquent, it will also reflect on your credit report. However, if this happens, you can always dispute the account and the credit bureaus will have to remove it because an authorized buyer is not financially responsible for the account.

(2) Retain Old Credit. Maintaining older credit gives you a longer credit history. This is important because credit history constitutes 15% of your overall credit score.

(3) Apply for Easy Credit. There are many companies that do not require strict credit

guidelines. These companies extend credit to consumers with little to no credit history and less than perfect credit. You may have to pay higher interests rates but if you pay on time and keep your balances to less than 30% of your available credit limit, you will build positive credit. Seek credit at your local appliance, furniture, jewelry and tire stores. In addition Radioshack, Fingerhut and Chevron Gas extend easy credit.

(4) Balance Transfer. Do not transfer all your balances to one low interest rate card. You may get many offers for the best credit cards with low and even zero percent interest rates, but if you transfer all of your balances to the one card then you run the risk of increasing your balance to limit ratio. A high balance to limit ratio lowers your credit scores. You should always maintain a balance less than thirty percent of your credit limit in order to have good scores. (Amount Owed is 30% of credit score)

(5) Decrease Your Credit Card Balance. Pay down your credit card and decrease your balance to thirty percent (30%) or less than your credit limit. Your credit score will increase. The great thing about this technique is that it works whether it is a $5000 limit credit card or a $500 limit credit card, your credit scores will instantly improve.

(6) Get a Credit Line Increase.

In the alternative, if you do not have the cash on hand to pay down your credit card account, request a credit line increase but don’t spend it! Many credit card issurers can increase your limit without running a credit report. Make sure you inquire before you request the credit line increase if you do not want to create inquiries.

(7) Get a Bank Loan Secured by a Savings Account. If you have at least $500 cash on hand obtain a savings account secured bank loan. Most banks and credit unions do not run credit reports when you apply for a secured loan. However, they do report these loans to the major credit bureaus, Experian, Equifax and Transunion. Bank loans rank high in credit scoring. But don’t stop at just one secured loan. Once you obtain the first secured loan, take those funds, go to another bank and repeat the process. Now you have two bank loans that will report to the credit bureaus. Make sure these loans are small enough that you can handle making at least two payments per secured loan before the actual due dates. When the banks report to the credit bureaus they will show these payments and you will have established an excellent payment history within (30) days of obtaining the loans.

(8) Get a Secured Credit Card. Secured credit is a good option for those who cannot qualify for regular credit. Not only will you have the benefits of a regular credit card but you will also get an opportunity down the line to convert that secured credit card into a regular one. The same rules apply with a secured card in that you must pay your credit card bill on time and you should keep your balances low. When seeking secured credit make sure the bank reports to all three major credit card agencies, Experian, Equifax and Transunion.

(9) Limit Hard inquiries. Hard inquiries can take up to five (5) points off your credit score. Applying for new credit will lower your credit score. Keep inquiries at a minimum. Additionally, any company that pulls your credit report without your authorization is in violation of the Fair Credit Reporting Act which allows only authorized inquiries to appear on your credit report. According to FCRA rules you are entitled to $1,000 for each unauthorized hard inquiry. (New Credit Applications is 10% of your credit score)

(10) Know the Information reported by Credit Card Companies. Make sure your credit card companies report your limit and balance. Some may only report your balance and not your credit limit. Lenders who engage in this practice may actually be causing your credit score to be lower. The scoring system will plug in your highest balance as your credit limit and if you are currently at a high balance this can be detrimental to your scores. Capital One was notorious for this practice; however, in August 2007 they changed their policy and will be reporting credit limits. This means many consumers who hold a Capital One credit card may see a boost in their credit scores.

(11) Pay Obligations by the Due Date. Pay your obligations by the due date. A late or missed payment can drop a good credit score by 100 points or more. It may not make sense but if you already have negative entries on your credit report adding more will not hurt you as much as if you don’t have any negative entries. Regardless, paying on time can raise your credit score. (Payment History is 35% of your credit score)

(12) Zero Balances may Hurt Your Credit Score. Strange but true. If you have many credit card accounts with zero balances your credit score may be lower. Credit scores can be raised by maintaining a small balance (at least $10) on your credit cards.

(13) Keep Balances to Thirty Percent (30%) of Credit Limit. Do not use over thirty percent (30%) of your available credit. Keep those balances low and your credit scores will rise. Definitely do not go over your credit limit. This hurts your credit score tremendously.

(14) Re-Aging to Improve Your Credit Scores. Re-Aging is a technique used by creditors to get rid of your past-due account. You are no longer delinquent and your account status changes to “current” which increases your credit score. Request Re-Aging from your creditors. Re-Aging is a quick and free method to raise your credit scores, it gives you a fresh start. Federal guidelines dictate how creditors can re-age accounts but essentially here is how it works:

• The borrower has to demonstrate renewed willingness and ability to pay the account on time.

• The account should be at least nine (9) months old.

• The borrower should have made at least three consecutive monthly minimum payments.

Cornie Herring asked:


Have you ever wonder why your online application for credit can be approved in 60 seconds? Or get pre-qualified auto loan for a car without asking you how much is your income? Or why your interest rates on loans are different from the interest rates of your friends or neighbors?

Your credit scoring is the factor that affect all the above. It is your responsibility to main a good credit score. You will need to use it to get you a best available rate when come to apply for credit.

What is Credit Score?

Most of time credit score is refer as FICO score (Fair Isaac Corporation), it is a number based on the information in your credit file that shows how likely you are to pay a loan back on time, the higher your score, the less risky you are. You credit score is derived from three major credit bureaus: Exprian, Equifax and TransUnion. These 3 major credit bureaus will compile your credit report based on the information provided by the companies that gave your credit in the past. Based on the information such as your payment history, the length of your credit history and the type of credit your have and the amounts owed, the credit bureaus will generate your credit report. And based on your credit report, a number or scores will be assigned to you; this number will be range from 300 to 850. This magic number is your credit score, the higher the number the better you are.

When Your Credit Score Count?

Your credit score will play an important part when comes to applying loans or other credits, it may save you a significant of interest if you are have good credit score. When you apply for mortgage, car loan, business loan or credit card, the lender or credit company will assess how risky you are as a potential borrower, the higher your score, the less risk you pose to the lender and the more likely you will get a better interest rate for application.

You will be offered at a relatively low rate if your credit score is above 700 and if your credit score is above 760, you will get the best available rates because you are the lowest risk borrower at this high of credit score. You loan will be approved with high loan rates if your credit score is below 600, and if your credit score is really bad, you may be not be able to borrow at all.

Maintain High Credit Score

Now you know how important your credit score is and when it becomes important and you can use it as a tool to save cash. Hence, it is important for you to maintain your credit score at high level. Things that you can do to increase your credit score include:



Pay your bills on time

Keep balances low on credit cards

Don’t open a number of new credit cards that you don’t need

Have credit cards - but manage them responsibly



In Summary

Credit score is not just a number, it is a tool that you can control and use to save cash. It will become important whenever you need credits and it is an important factor to be considered by any financial organization before they approve your credit application. Hence, keep your credit score all time high.