How a good credit score can save you money and how to improve your credit score

If you have ever applied for a loan (mortgage, home equity loan, auto loan, personal loan, credit card etc.) then you already know how important it is to have a good credit rating (FICO score).


Before credit lenders approve or decline your loan request they check you credit history with the following credit agencies to determine your credit risk:

Equifax
Trans Union
Experian

Your credit report usually lists the following information:
Personal information: (your full name, current address, Social Security number, date of birth, employment information).

Information about your credit accounts (credit cards, car loans, mortgages, lines of credit and other credit accounts. It includes the dates that accounts were opened and closed, current balances, maximum credit limit and how often you were late making payments, or if any accounts were charged off).

Information about requests for your report as a result of your having applied for credit, or requests that were made by others (for example: credit card companies, or other financial institutions ) to make you a pre-approved offer of credit , during the last 2 years.

It also lists information about (Bankruptcies, foreclosures, lawsuits, liens, wage attachments, court judgments) if it applies.

Some lenders make a determination by your FICO score. FICO scores range from 300 to 850. The higher your score-the easier it is to get credit and of course lower scores make it a lot more difficult to get credit and if you get one, the interest rate will be rather high.

Your credit score will be lower if you have missed payments or made late payments, if account balances are high, if you have too many recent enquires or if there is simply an error in your report.

There are ways to improve your credit rating. First of all, order you credit report and make sure that there are no mistakes and all information posted is accurate.
Make payments on time, lower your balances, and don’t apply for more credit. These steps will gradually improve your credit rating. This will not happen overnight. It make take months, and may even be years but it is all worth your effort.


YOUR FICO SCORE

 300     620    850

Check your credit. Once a year it is available for free. Go to: https://www.annualcreditreport.com/cra/index.jsp  or call: 1-877-322-8228