Posted on 03/23/2010 2:19:31 PM PDT by SmartInsight
As banks shy away from making risky consumer loans, a mediocre credit history just won't cut it anymore. To get the best rates on mortgages, credit cards and auto loans, you need a killer score.
Your FICO score is a numerical measure of your creditworthiness that ranges from 300 to 850. While there are a few different credit scoring systems available, it's the FICO score, created by the Fair Isaac Corporation, that most lenders look at when they check your credit.
Lenders have already raised their standards by about 20 to 40 points this year, according to Barry Paperno, consumer operations manager at FICO. So while a score in the 720 to 740 range would have gotten you the best rates on a mortgage in the past, you now need a score of at least 760 to snag the best loans.
(Excerpt) Read more at money.cnn.com ...
That is good advice.
with the economy and us dollar headed for complete collapse, anyone buying anything on credit is crazy imo. We need to pay things with cash in this country and quit borrowing.
Looks like CNN is trying to mitigate the damage it’s helped cause.
But if you need to borrow, keeping your credit score as high as possible makes it easier to get a loan and also helps to get better rates.
Sometimes people end up being late with payments, not because they can’t or don’t want to pay, but just get busy and miss the due date, and your credit rating goes down and it stays with you for 7 years.
You can check your credit report (not the score, just the report, but that is still useful) here:
https://www.annualcreditreport.com/cra/index.jsp
once every 12 months — this is not one of those places where it’s a come-on and you have to subscribe to something to view your credit report for free. This is really free, no obligation.
“This central site allows you to request a free credit file disclosure, commonly called a credit report, once every 12 months from each of the nationwide consumer credit reporting companies: Equifax, Experian and TransUnion.
AnnualCreditReport.com is the official site to help consumers to obtain their free credit report.”
Yes, but we also need to pay off current cards. With credit unbelievably tight for small business, I have a lot of $$$ accumulated on cards to keep the heat on, my doors open, and to pay my payroll. I have to work diligently to pay all of that off, and I can’t afford to lose any cards because that may tip the ratio & I may need them again in the future.
Yes, but we also need to pay off current cards. With credit unbelievably tight for small business, I have a lot of $$$ accumulated on cards to keep the heat on, my doors open, and to pay my payroll. I have to work diligently to pay all of that off, and I can’t afford to lose any cards because that may tip the ratio & I may need them again in the future.
We had our daughter on our credit card when she was in college. Several years after she graduated, was married, had a job and was financially independent we took her off our card. That dropped her credit score by 100 points. She was pizzed.
>> FICO focuses on five categories when calculating your score: How much debt you have, your payment history, your debt utilization ratio (how much you owe in relation to your credit limits), how far back your credit history goes and your mix of various types of credit.
“The rich ruleth over the poor, and the borrower is servant to the lender.” — Proverbs 22:7
Notice NONE of the FICO components include wealth, financial security or income. Your FICO score is pretty much measures how well you borrow money and how systematically you pay the bank interest. That’s it. It measures how much of a tool of the bank you are. If you want a good credit score, your entire life will have to be a ferris wheel of borrowing and repayment with interest.
If you want to borrow money, then you must worship at the alter of the God of FICO. I won’t. With the possible exception of a 15-year fixed-rate mortgage (with a big down payment), I’m OUT of the borrowing business permanently — so I honestly couldn’t care less about my FICO score. I look forward to the day when my FICO score is non-existent.
SnakeDoc
“with the economy and us dollar headed for complete collapse”
Actually, it’s better to be a debtor when a currency collapses, as the real value of your debt decreases.
Just buy stuff that will generate income.
I don’t know if you’ve ever read Dave Ramsey — but he’ll teach you how to cut the cards up, pay them off fast, and build a financial future where you’ll never want or need to borrow money again.
He’s Christian, he’s conservative, he’s got common sense, and he has completely turned the financial future of my family around. I cannot recommend him or his teachings highly enough.
http://www.amazon.com/Total-Money-Makeover-Financial-Fitness/dp/0785263268
SnakeDoc
A SINGLE late payment could cost you 110 points and a short sale only 90?
>> Actually, it’s better to be a debtor when a currency collapses, as the real value of your debt decreases.
Tell that to people who had foreclosures. They can’t take it if they don’t own it. It is always better to not owe anyone anything.
SnakeDoc
Did you ever want to know what your credit score is , but didn’t want to have to pay for a credit report?
Gives you your up-to-date FICO score at no cost.
No its really poor advice and misleading as well. I do this stuff for a living. Attorney by trade, work at a mortgage bank.
1) Increasing your number of accounts can increase your score by 3-30 points if you don’t have much credit.
2) A late payment will not affect your score much after around 6-8 months depending.
3) Paying down cards to less than 85 percent of your limit can increase your score.
4) Defaults don’t really do much harm after 8-9 months.
5) Many people can get their scores raised from 30-80 points without ever having negative items erased from their credit file.
> Making late payments
This is a loaded item. My wife’s car loan company has sneaky practices. In the past 15 or 16 months, we get our bill and statement, only 5 to 7 days ahead of the due date and if there’s a holiday it may be only 3 to 5 days.
4 years ago, we got a month, then 3 weeks, then 15 days, then 12 days and they’ve inched it down to barely a week.
If I don’t write the check the day it comes, it will be late.
I started paying certain bills, credit card etc, ON LINE. I instantly mark the PAPER statement 4 days ahead of DUE DATE. I do the computer thing mid-morning, print out the acknowledgement that is coded and DATED, then wait a day or so and print out the e-mail that they send, also coded and dated. No games. No delay in the mail. No worrying about a snow storm. Let them murder the trees, I save the paper.
It seems to work.
I also have a “LOW LIMIT” card I use when I have to furnish a card number to someone I’ve never dealt with. Every so often they are “proud” to increase my limit. I tell them to drop the limit or I cancel the card. No problem.
Would getting that info from the site be considered a hard hit?
Credit Scores are bourgeois and racist. Chairman Obama will make them go away soon!
No, it doesn’t count at all. Unless you apply for a loan of some sort.
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