December « 2010 « free 3 credit report

December 30, 2010

Credit Bureau Reports and Your Credit Rating – Do You Understand Your Credit Score?

Filed under: Finance — Tags: Consumer Reporting Agencies, Credit Bureau Reports, Credit History, Credit Insurance, Empirica, Equifax, Experian, Fair Isaac Corporation, Insurance Employment, Personal Credit, Personal Score, Public Utilities, Renting A Home, Term Loans, Trade Accounts — admin @ 9:09 pm

Marilyn Katz asked:

Do you know what a credit rating is? Furthermore, do you know what your own personal credit score is? Most people don’t think they need to worry about it. They do. Even if you don’t ever borrow money you need to be concerned. Let’s say you need to buy a new car, and like most of us, cannot pay cash for it. You will need a car loan. At some point in your life, you will probably want to buy a home. You will probably need a mortgage! The most important factor the lender considers is your credit history and credit score. This wil factor into the interest rate offered to you. You need to understand this important part of your financial life in order to manage it to work in your favor. If you ignore it, it will probably work against you.

A credit rating is issued by an agency. The rating is a measure of how you have handled your finances. A credit report contains information on where you live, how you pay your bills, and whether you’ve been sued, arrested, or filed for bankruptcy. Nationwide consumer reporting agencies sell the information in your report to creditors, insurers, employers, and other businesses that use it to evaluate your applications for credit, insurance, employment or renting a home.

There are three major bureaus. Each company determines your personal score based on a formula developed by the Fair Isaac Corporation. Each agency uses a slightly different term for their score. Equifax calls their score “Beacon;” Experian calls their score “FICO;” and Trans Union calls their score “Empirica.” Since lenders do not usually report account activity to all bureaus your credit score may vary.

The rating takes into account activity related to revolving and installment based credit that is not secured by hard assets. This includes your credit cards, term loans, trade accounts, public utilities, lines of credit etc. The agencies may not use the same scoring system so even if all the information is exactly the same the score may vary. The rating system provides you with a credit score between 300 and 900 and a higher score indicates a lower credit risk. A score of 650 or higher is usually considered good credit by most lenders.

What Factors Matter?

Payment History -Were payments made on time? – 35%

Amounts Owed – Is the balance owed close to the limit? – 30%

Length of Credit History – How long have your accounts been open? -15%

Taking on more debt – How many new accounts have been opened/? – 10%

Types of credit in use – Mortgage, auto, consumer finance accounts, revolving and installment loans -10%

What is not calculated?

Your race, color, national origin, sex, age, marital status Your salary, occupation, job title, employment information or home address The interest rate on your charge accounts Any items such as child support, rental agreements, credit counseling participation Is your credit score always accurate? No. It is estimated that almost 80% of credit reports contain errors. So if you want to correct these errors you will have to get a copy of your report. Fortunately, the Fair Credit Reporting Act requires each of the nationwide consumer reporting agencies (mentioned above) to provide you with a free copy of your credit report, at your request once every 12 months.

Tammy

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Credit Score Rating and Its Implications

Filed under: Finance — Tags: Bad Credit Rating, Best Interest, Business World, Credit Score, Financial Security, Financial Situation, Financial Transactions, General Idea, Government Credit, Insurance Mortgages, Maximum Rates, Negative Impact, Rents, Score Ranges, Us Population — admin @ 7:04 pm

Toddy Martin asked:

Credit score is very important in the business world. This is a key factor in assessing someone if he or she is qualified to certain loans, insurance, mortgages, rents and job opportunities and whether you have a good or bad credit rating. Do not fall into the stigma that people who have bad credit ratings are financially insecure and irresponsible by maintaining a good credit report and score.

Probably you already had a general idea on how a bad and good credit score affect every consumer. A person who has a good score will benefit from low interest rate, fast approval and processing of loans, decent apartment, and better employment.

Knowing how credit score ratings are classified is essential in gaining a more holistic understanding of your financial situation. Credit score ranges are classified from A to D, A being the highest.

Rating A (Excellent)

60% of US population

700 and up score

Access to best interest rates and terms

Rating B (Good credit)

27% of US population

600-699 score

Access to good interest rates but not the best

Rating C (Risky credit)

12% of the US population

500-599 score

Have to pay at least two percentage higher or more from that of the A rating category

Rating D (Very risky credit)

1% of US population

499 and below score

Experienced credit judgments, foreclosure and lien

Have to pay the maximum rates determined by the government

Credit ratings have serious implications in your financial life. As seen from the classification, it will largely determine your future financial transactions and economic standing. A high credit rating means you have to pay less for housing, insurance, interest rates, and loans. This situation opens up an opportunity for someone to save and the savings can be invested to a profitable business venture. This is a plus point in attaining financial security.

There is an ongoing debate on whether credit scoring and rating will have a negative impact to consumers. Businesses on the other hand use them for efficiency. Credit rating is generally used for predicting how a certain person can keep up with the payments. Patterns have been established that people with bad credit ratings are usually delinquent payers and suffered bankruptcy in the past.

If you want a secured financial life, you must be knowledgeable about your credit reports, credit scores, and credit ratings and what are their implications to your entire life. These concepts are not hard to understand if you take some time to read about them.

The internet has provided a venue for you to access information about them and related topics very quickly and easily. You can also regularly check your score and updates on your credit reports through the credit monitoring agencies.

Exercise caution and control in your credit spending. Everything boils down to this. What you sow is what you reap. A low debt means you can easily keep up with payments and a less tendency to have low credit score.

Kathy

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December 29, 2010

3 Credit Reports and Scores – Why Get Your Credit Scores Based on Your 3 Credit Reports

Filed under: Finance — Tags: Financial Information, Free Annual Reports, Free Copies, Illegal Activities, Illegal Transactions, Loans, Necessary Actions, Official Web, People Information, Poor Credit Score, Responsible Person, Social Security, Social Security Number, Victim Of Identity Theft, Vital Information — admin @ 10:00 pm

Davion Wong asked:

Your 3 credit reports and scores are crucial information in your life as a citizen of the country. This will determine your credit risk which serves as a basis for approval of various types of loans. It can also be used to judge your character being a responsible person by some employers if you apply for a job; and still there are many other purposes which you will later on realized until you will finally experienced its worth.

Some people just take this for granted by missing to make a request for their free copies every year. Only then will they feel its importance when faced with the situation of being rejected with their applications because of poor credit-score. Hence, don’t wait for the time when it is too late to do something about your ratings when you can do it now by getting your free annual reports in order to make necessary actions to improve your credit-score for future needs.

Another reason why you should get your 3 credit reports and scores is to prevent from being a victim of identity theft. A lot people have already become victims of various illegal activities done by other people in behalf of their name. This can happen because it is very easy to set up your credit account which usually requires only your name, address, and your social security number. Hence, when people get access to these three vital information from you, they can easily set-up fake credit account and perform illegal transactions under your name which could greatly affect your credit-score.

That is why it is very important to check your 3 credit reports and scores regularly in order to report any recorded transactions not made by you. This will prevent further damage to your financial reputation; as well as deter other people from using your financial information for illegal activities.

In order to get your free copy of the report, just go online and log on to the official web site of the three main credit reporting bureaus tasked by the federal government to provide every citizen a free copy of their credit report once every twelve months. Your report will only be sent to you upon your request; however, you only need to make one request and you will get 3 credit reports and scores from each of the official credit-reporting agencies: the TransUnion, the Experian, and the Equifax.

Charlotte

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Credit Rating Agencies

Filed under: Finance — Tags: Assumption, Banks, Credit Rating Agencies, Debt Instruments, Downward Spiral, Good Job, Grain Of Salt, Investor, Loans, Offerings, Turmoil — admin @ 4:06 am

Chris Duncan asked:

Credit Rating Agencies are suppose to provide an unbiased, objective rating on various instruments that an investor can partake in. Over the years they have done a pretty good job. Unfortunately, much of the current turmoil is due to agencies giving high ratings on debt instruments that were really too complex to understand and weighted ratings towards the high end on an assumption of future growth.

Wow, I almost sound like one of them. That is really scary. In English then. Credit agencies were giving very high marks for the bundled debt that banks were selling. Packages were put together with large amounts of good loans and some riskier loans. The problem was the assumption was that even if the riskier loans went bad, the asset (usually a house) would be able to be sold for more than it was originally purchased for. And of course that lasted for quite a few years. But then some of the loans (I almost wrote loons) started going bad. And then a lot of them. Finally, home prices started to drop dramatically and it was a downward spiral from there. So why is this important, well you need to take ratings with a grain of salt and sometimes you might want to do some of your own digging.

My focus is going on ratings for municipal offerings. Moody’s and S&P (Standard & Poors) are the most common. Some municipalities will also use Fitch. It makes you wonder if the municipality doesn’t shop around for the one that will give you the highest. But thinking like that makes the black hats come out and I try to avoid that. Moody’s highest rating is triple A (A a a). Yes, it is shown as a capital “A” followed by two lower-case “a”s. Maybe because there is already a Triple A insurance agency and Alcoholics Anonymous. If the investment you are buying is in the A range, it is considered to be a “low credit risk” (probably won’t default). There are three tiers. A a a — highest quality with “smallest degree of risk” Aa1, Aa2, Aa3 — high quality with “very low credit risk” A1, A2, A3 — “upper-medium grade” with “low credit risk”. Hmm seems a little sketchy

S&P has a similar rating scale but their top 3 tiers are A A A, AA, & A. They use a + or – to denote a rating that is slightly above or below the main tier such as AA+ or AA-. A bond with a rating in the B range is becoming on the more risky side. Moody’s has a Baa2, Baa3, and Baa3 and S&P has a BBB+, BBB, BBB- that are considered adequate but it wouldn’t take much for those bonds to start going south. Below that and you would be in the High Yield or Junk bond status. Rarely do municipal bonds get in that range. Also they rarely default.

When it comes to municipal bonds there are two basic types a General Obligation (GO) and a Revenue Bond. GO bonds are deemed the safest for the investor as they are tied to tax revenue and the general ability of the entity to raise taxes if necessary to pay the debt back. Of course this may not seem like such a good deal for the citizens if their taxes are raised. Some states have issued laws (such as California) that make it more difficult to raise taxes without public support. Generally, GO bonds from a healthy municipality with good tax revenues and future growth prospects would receive the top rating.

A Revenue bond on the other hand is a bond issued to build a bridge, hospital, stadium, etc. that is paid back with the revenue (fees, taxes, tools) it generates. So its rating is based on the outlook for the project and likely future success. A bridge in Death Valley might not have as good as a prospect over the San Francisco Bay. Usually, the municipality is fairly certain of success and has done their homework. Ratings are typically in the third to second tier. But again, check out the community and see what is going on. Search Engines can be a wonderfully powerful tool in that regard.

As always I hope this has been helpful. Technically, I’m a CD guy, but this seemed like a useful and helpful topic given where yields are currently.

Tanya

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Learn About Credit Score!

Filed under: Finance — Tags: Credit Departments, Credit Score, Credit Scores, Experian, Landlords, Transunion — admin @ 12:03 am

Khan Paki Gee asked:

The entire 3 credit scores play part as unequivocal agents of a person’s monetary status. The majority of the loan organizations, owners and landlords inspect the credit marking to form an opinion how you have been running your capital prior to joining any sort of deal with you. As a result, it is fairly significant to be knowledgeable about what your 3 credit scores are from the 3 credit departments; Transunion, Experian & Equifax furthermore, take measures to fix any matters on your credit details to get better the markings.

We at this time take a look at the aspects which have an effect on all the 3 credit grades as well as the aspects which do not have any impression on the scores.

Aspects that do not have an effect on the credit score are:

Utility bill disbursements do not influence credit marking on the contrary if you do not reimburse these bills plus they enlist collected works in that case it will be trouble for you. The financial credit is not measured in markings if not particular check bounces as well as is converted into collection. Rental fee is not portion of the credit score as well but if rent is debased plus it is converted into a ruling or collection in that case it will turn out to be portion of the credit details furthermore measured in your 3 credit grading. Insurance disbursements do not have an effect on credit total result. Medical fees disbursements are not portion of credit rating unless these are kept due as well as go into collections.

A number of most important aspects that 3 do have a bearing on credit ratings are mortgage disbursements, law-breaking, foreclosure, credit card evasion, overdue disbursements, collections, various great disbursements plus charge offs. You have to confirm your credit report on a regular basis to make sure what is on it moreover, take measures to take out things that you feel you have previously disbursed and are even now viewing on your financial credit.

Julia

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December 28, 2010

Improve Credit Rating – Dispelling 5 Myths

Filed under: Finance — Tags: Bank Cards, Credit Card Debt, Credit Score, Debt Instruments, Department Store Credit, High Interest, How To Improve Your Credit Rating, Improving Your Credit, Improving Your Credit Rating, Interest Cards, Late Payments, Myth 2, Myth 3, Shoebox, Store Cars — admin @ 10:51 pm

Jed C. Jones Ph.D. asked:

There are a lot of myths floating around about how to improve your credit rating. Truth is, a better credit rating can save you $1,000s in annual debt payments.

Here I dispel 5 myths about improving your credit rating:

Myth #1: I do not stand to gain much financially by improving my credit score

The Truth: Even a 50-point improvement in your credit score can save you $1,000s in annual debt payments. Reason: a better credit score means you are eligible for lower interest rates on your loans and credit card debt, and lower rates can literally save you hundreds of dollars each month.

Myth #2: I should close as many credit cards as possible

The Truth: Actually, closing out your credit cards can actually backfire and worsen your credit score. This is because 30% of your FICO score factors in the amount you owe versus the total amount of credit extended to you. By closing cards, you hurt this part of your score. Pay down cards: yes, but close them: no.

Myth #3: I should reduce the types of debt I have to as few as possible

The Truth: About 10% of your credit score is based upon the diversity of debt instruments you have. Translation: it is better to have a few bank cards, a few credit cards, a few department store cars, and maybe an auto loan or a mortgage. Do not run out and close your department store credit cards, for example. Just pay down the high-interest cards and then put them away in a shoebox in your closet but leave the accounts open.

Myth #4: It is too late to fix errors and late payment issues from the past

The Truth: In reality, you can and should try to fix errors on your report and to reconcile late payments, even if those items occurred months or years ago. If you can prove that the errors you found are indeed errors, the Big Three agencies will remove them from your report immediately. Regarding late payments from the past, you can usually offer to make those payments even if it is now months or years since they were due. In exchange, ask the institution in question to remove the corresponding glitch from your report. Since 35% of your score is based upon your payment history, this can really boost your score.

Myth #5: I should not apply for more credit cards

The Truth: Actually, increasing the total credit amount extended to you can actually improve your score. This is even true for high-interest cards; just be sure not to actually use them after you receive them! And, watch out for cards with annual fees before you apply.

There are many myths floating around about how to improve your credit score. By educating yourself, you stand to significantly improve your credit rating.

Heather

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December 27, 2010

Bad Credit Rating? Worry No More!

Filed under: Finance — Tags: Arrears, Bad Credit History, Buying A House, Car Loan, Credit Card Bills, Credit Counseling, Debts, Discrepancies, Establishments, Leasing A Car, Loan Defaults, Poor Credit, Receipts, Renting An Apartment, Utility Bills — admin @ 7:34 am

Dave Poon asked:

Good credit rating, credit score, credit history – no matter which of these terms you use, they are very important terms referring to your ability to buy something.

A good credit history is a definite plus for you when you are planning to make a major purchase.

When getting a car loan, or buying a house, or you need a large amount of cash – the interest rate will be based on your credit score.

Even for what seems to be the most basic task like applying for a local telephone service in your area, you need to pass the credit testing provided by the company.

When renting an apartment, or leasing a car – all these activities would require you to pass a certain credit score.

Having an impossible credit history or a bad credit score may seem to be the end of the world for you, but that is not so.

With a little organizing and a lot of patience, you can still straighten out your finances before it’s too late. Here’s how:

1. Poor credit can be caused by a number of things.

- delayed payments on your utility bills

- arrears on your credit card bills

- low credit score from a bad credit history

- no credit history

- loan defaults

- bankruptcy

To counteract this, you need to have a general overview of your finances. First, review your credit card statement from the last six months.

Check out any discrepancies and review your receipts from major purchases if you have to.

2. If things look really hopeless from your end, do not be afraid to get professional help.

There are credit-counseling establishments who can help you slowly crawl your way out of your debts.

These financial advisors might give you the most basic solution – which is to consolidate your debts.

It is based on simple mathematics, which is by adding debt A to debt B and C. Once they are added all together, there will be one amount that you would owe rather than paying different amounts for three separate debts.

This way, there will only be one interest paid, rather than having separate interests for debts A, B, and C. These interests which add up usually cause most debtors to go bankrupt.

3. Never use a new loan to pay off an old or existing debt.

This is another trap that most lenders fall for. They think that by getting another loan which is supposed to pay off the old loan, they can finally be debt free.

What they do not know is that the interests might pile up to such an astounding amount that it will be impossible to pay off.

4. Cancel any credit card account that you do not need.

5. As soon as you have repaid your debts, you can get apply for a new credit card to have a clean slate.

This time, take care of your money and control your spending. Make sure that you do not overcharge the card and always pay your monthly credit card bills on time.

There is always a way out of a debt, if you will just learn how to spend responsibly and monitor your expenses closely.

In no time at all, you will get back that glowing credit score that most companies are looking for.

Kathy

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December 25, 2010

Credit Score Rating

Filed under: Finance — Tags: Bad Credit, Credit History, Credit Rating, Credit Report, Credit Score, Debts, Edge Of The Road, History People, Improve Credit, Loans, Negative Entries, People Rating, Rating People, Unused Credit — admin @ 3:06 am

Santhana Chann asked:

People who have a bad credit often find it difficult to obtain a loan to supplement his needs. As bad credit is not desired by any company or individual to issue the loans, these people often tend to get to the edge of the road and lose their hopes. However, there are chances that one can improve his credit score and turn bad credit report in to a good one. Only then he can improve his chances of qualifying for a loan.

The quicker you turn from the bad credit score to the good one, the quicker you have the chances of qualifying for a loan. Moreover, doing this can save lots of bucks for you. There are certain ratings given to each individual based on his credit history. People who have a rating as ‘OK’ are highly prone to more loans than those people who have their credit history rated as ‘Fair’. This clearly implies that people with the ‘fair’ credit rating have to clear off all their debts as soon as possible to get qualified as ‘OK’. The unused credit does all the difference and stands as the major factor in determining the rating of an individual.

People with lower credit rating have to work along way to get into higher credit rating. They have to concentrate on the negative entries that they have allowed to enter in their credit history. One is always recommended to maintain a good score as only people who have a good credit score have the highest chances of obtaining a loan than any others.

Julia

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December 24, 2010

3 Ways to Improve Your Credit Score by 50 Points In Less Than 30 Days

Filed under: Finance — Tags: 3 Ways, Car Credit, Collection Agencies, Credit Accounts, Credit Repair Services, Credit Scores, Dear Friend, Discussion Groups, Improving Your Credit, Improving Your Credit Rating, Insurance Salesman, New Accounts, Payment History, Self Respect, Step 3 — admin @ 11:26 pm

Hartley Pinn asked:

In Less Than 30 Days.

“What can you do to increase that set of three numbers on your credit report that can be so important with your financing?”

I came across this question as I was surfing discussion groups the other day. Check out my answer:

Dear Friend,

Here are 3 steps I used to take my credit score from 592 (horrible credit) to 762 (perfect credit) almost overnight. If you’re interested in improving your credit rating quickly, you’ll find this story helpful:

In 1995 I made a decision that would ruin my perfect credit history. I quit my salary job to become an insurance salesman. The job paid commission only. Within a few months I lost everything – house, car, credit rating and my self respect.

By the end of 1996 I was living with my mom, all my credit accounts were severely past due, and I was paying 22% interest on a broke-down green Geo Storm…I was a real loser.

Then, in 1997, I became a banker. I didn’t know it at the time, but this would turn out to be the break I needed to eliminate my credit problems forever.

During my seven years as a banker, I came across several legal and highly effective ways to improve my credit rating. As a result, I was able to increase my credit scores by an average of 170 points.

Here’s what I did:

Step #1: After spending hundreds of dollars on credit repair services that didn’t work, I found out how to get negative accounts removed on my own.

Basically, I wrote letters to the collection agencies requesting proof that the accounts were mine. 89% of the time they had no proof that the bad accounts belonged to me. So I was able to get them deleted from my credit file.

Step #2: I opened new accounts with high credit limits and kept the balances low.

I discovered that if you keep your available credit limits high and only use 10% to 30% of the credit you have available, your credit score will improve dramatically.

Step #3: Next, I added accounts with years of perfect payment history to my credit file. This step took my credit score from 647 to 762.

While you can certainly add seasoned accounts to your credit file for free, there are companies that claim they can do it for a fee.

The problem is, they charge between $2,000 and $2,500 per account. If you want a 700+ credit score you’ll need 3 to 4 of these accounts. That equates to a cost of $6,000 to $10,000.

(You can conduct a search on your favorite search engine for companies that offer this service.)

While there are several highly effective steps you can take to increase your credit scores by as much as 200 points, these are the main ones…And here’s the good news: Each step can be completed in less than 30 days.

Josephine

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Establish Your Credit Rating

Filed under: Finance — Tags: Banks, Car Loans, Credit Rating, Data Mining, Establish Credit, Financial Health, Financial Institutions, Home Loans, Investment Account, Loan Account, Money Loan, Personal Loan, Risk, Score, Term Investment — admin @ 2:45 am

Simon Oloughlan asked:

Your credit rating is important to your financial health. Good credit ratings mean that lenders will lend you money for items you wish to purchase. Home loans, car loans and credit cards are issued on the basis of a good credit rating.

When starting out, it is important to be able to get the major purchases in life. You must establish your credit rating before you apply for major loans. The best way to do this is to talk to a bank manager about establishing a credit rating.

Your bank should be able to setup a small loan account at a low interest rate. Most banks will want you to apply for a credit card instead of applying for a loan. Do not do this. The banks earn a percentage of the credit card fees and charges without incurring the risk. This is why they want you to get a credit card.

Establish your small personal loan with them. Let’s say you borrow $500.00 in the form of a personal loan. This will most likely be over a period of one year at a low interest rate. Your repayments will be around $55.00 a month. This is hardly a financial stretch.

Take your $500.00 and invest it at another bank. Get a term investment account that lets you invest the money for a year. Your interest earned will not be as high as the interest charged to you, but it will off-set the cost of your borrowed money.

Pay your loan back to the first bank with money you earn during the year. Make sure you meet the repayments on time, every time. This is your credit rating we are establishing here. It is the ability and readiness to repay, that financial institutions are concerned with. One error at this stage will mean a down grading of your rating.

At the end of the year, you will have met the terms of the loan and established your credit rating. You will also have savings of $500.00 plus interest earned. Different rating agencies will score you using different formulas. Most agencies use formulas calculated on the history of your borrowing and any information gained from data mining. Data mining is a process of research done by companies about your spending habits and store card information.

Lending from major banks carries the most weight in these formulas. If you feel confident in your ability to repay loans, you can repeat the above process for larger amounts. This also increases your credit score.

Guard your credit rating closely. Enter into joint loans with the upmost of care. Many people have had their credit rating destroyed by a partner in a failed marriage, or failed business venture. Always seek legal advice if you are to put forward your credit rating in joint ventures. Sometimes the use of structured entities such as companies or business entities is a better way to obtain finance on a large scale. You should talk to your financial adviser about this.

Starting out to obtain a credit rating is a very important part of securing your financial future. To create wealth and stay debt free, you will be using the services of lending institutions. These institutions will only lend money based on sound financial lending practises. Make sure you have your budget in place and your credit rating in good order before you apply for a loan. Start small and build your loan amounts. Do not obtain loan money without knowing that you have a built in safeguard for repayment. There are some insurance policies that can cover this aspect for you and we will discuss this in future articles at the Debt Support Center.

Now, go get your credit rating

Dawn

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