Few things influence the home buying process more than your credit. I like how Clark Howard refers to the three credit repositories as, "the three screw-ups". There is some validity to that, and hopefully recent legislation will help clean up many of the inaccuracies. Regardless, lenders need a source to determine levels of risk for lending money? and the Fair Isaac Company is where it lies. (Note: Fair was one of their last names? doesn't necessarily denote fairness.)
There are close to 50 different things that influence your credit; some good, some bad. Within those 50, there is some 14,000 variations?talk about a fragile balance! For example, did you know that if you pay off a collection it might actually lower your score! Don't worry most lenders don't know it either. Also, beware of credit counseling services that promise all kinds of miracles. The only things that can be legitimately removed from your credit are things that are invalid, erroneous, or outdated. Aside from that, if it is yours? it's yours. There may be ways to "flower it up" but it isn't coming off. (Being intellectually honest, you know it shouldn't either.)
If you are going to be hunting for a home, be sure to curtail the temptation to go out make purchases that may affect you credit. Obviously you wouldn't want to go buy a car, but other things that may not be quite as obvious may be the purchase of furniture or home improvement items that would need financing. Chances are you may need these things, but wait till after closing.
What is the biggest credit mistake?
You wouldn't believe how common it is! The biggest credit mistake that most of us make is closing our old paid off credit cards. I know that is seems like the right thing to do when you pay off the balance but 15% of your FICO score is made up of your credit history. If you close a credit card with no current balance that you've had for years, you are getting rid of a lot of your credit history.
Another 30% of your FICO score is made up by your Debt to Credit Limit ratio. With this component, you show how well you manage the credit extended to you by using it wisely and judiciously. Let's say that you had two cards with $2,000 limits and one was maxed out and the other one was just paid off. Well you have $4,000 of credit extended to you and you're using almost $2,000 of that credit (you don't want to go over 50%). Now you cancel the paid off card and your new debt to credit limit ratio is 100% ($2.000 out of $2000). Ouch, that hurt your credit score.
Genesis Font is an SEO and Developer for LoansInteractive.com > Mortgage and Loan Officer Websites. We also offer Quality Web Hosting Services.
We have all heard countless stories of people over their... Read More
If you have never heard of a FICO score before,... Read More
Everyone hates late fees and being late will cost you... Read More
"Erase Bad Debt !""Remove Negative Items From Your Credit Report"You've... Read More
FACTA stands for Fair and Accurate Credit Transaction Act. FACTA... Read More
Lenders are quite fussy about what they like to see... Read More
While working through my own debt situation, and helping others... Read More
Fixing a credit report starts with seeing what's on it.... Read More
Credit scores: all lenders use credit scores to determine interest... Read More
Spending HabitsSo you've just got your credit card. The first... Read More
How can I prevent Identity theft from happening to me?... Read More
For all people shop around for the best rate, there... Read More
Many companies use the slogan "Bad Credit? No Credit? No... Read More
Creditors will measure your credit rating based on the following... Read More
In the new millennium plastic money or credit cards has... Read More
If you are in danger of credit problems because you... Read More
Have you ever been told you were over your credit... Read More
Here's a simple system on how to pay zero interest... Read More
Credit card debts problem is extremely common today. It is... Read More
Identity theft has become an epidemic. Millions and millions of... Read More
The credit industry if rife with pitfalls. If you have... Read More
No doubt, you've probably gotten literally hundreds of credit card... Read More
These five debt negotiation facts along with a few debt... Read More
It goes without saying that your first and best defense... Read More
What are the avenues available to businesses with weak credit... Read More
Having credit education is like knowing how to read. It... Read More
Having a credit card is a wonderful convenience for those... Read More
How do these people get my name? If you have... Read More
Nearly 20 years ago I worked for a small consumer... Read More
If you're a college student, you probably already have a... Read More
Credit Cards can bankrupt you if you let them run... Read More
On one hand consumers are being universally criticised for running... Read More
Maintaining your Credit ProfileEvery consumer should be maintaining their credit... Read More
How to Repair a Bad Credit Rating?The Right Way!If you... Read More
ChexSystems is a company that maintains a subscriber membership service... Read More
A credit card allows you to buy things even though... Read More
In August, 2004, the Federal Trade Commission issued their findings... Read More
Credit repair, is in a word, vital to reestablishing your... Read More
It is important to know your credit rating for a... Read More
Credit is currently and has been historically an integral component... Read More
There are millions of consumer credit reports on file from... Read More
The Beginning of the Credit Card EraIn 1951, Diners Club... Read More
Identity theft is when someone uses, without permission, your personal... Read More
If you're like the average person, let me warn you... Read More
Imagine opening your credit card statement one morning and discovering... Read More
The articles and tips provided on this site are intended... Read More
Many employers are now looking at an applicant's credit report... Read More
How do these people get my name? If you have... Read More
If you've ever applied for a credit card or loan,... Read More
What Is Your Credit Rating Now?If you have any charge... Read More
The first rule when applying for banking and credit services... Read More
Most consumers are aware that there are companies that keep... Read More
Do you have a poor credit rating? If so, you... Read More
Online car finance is convenient. You can apply over the... Read More
A lot of people spend more money than they can... Read More
It's not as hard as you think to raise credit... Read More
There are many of us that have been badly stung... Read More
The credit industry if rife with pitfalls. If you have... Read More
If you begin foaming at the mouth once a month... Read More
According to the September 2004 issue of the Nilson Report,... Read More
When applying for a loan to purchase a car, the... Read More
If you have ever fallen behind on your debts you... Read More
By now, you have undoubtedly heard of credit card fraud,... Read More
Your credit report is a very important piece of the... Read More
A good credit reward card can contribute to your retirement... Read More
Collection agencies are businesses that collect past-due bills and accounts... Read More
Credit |