Home > Credit Repair >
Bad Credit Repair > Bad Credit Score: Know how To Be Safe
Bad Credit Score: Know how To Be Safe |
|
Have you ever wondered if you had "good credit" or "bad credit" and how creditors, such as banks, determine if you are creditworthy? If so, you are not alone. Traditionally, the procedure used by most creditors to determine your creditworthiness or credit rating has been shrouded in secrecy. However, you can take heart as recent legislation in California has helped shed some light on the credit rating or credit scoring process. Consumer groups across the country have hailed the legislation as a "major step forward".
Remember, a favorable credit score will help you obtain favorable credit terms. Credit card issuing agencies, for instance, often determine the interest rate and fees that they charge an applicant based on a credit score. The cards featured in our "low rate report" are only issued to applicants with a high credit rating. Knowing Credit Scores A credit score is a single number based on an analysis of information contained in a credit report. The report provides an indication of how likely a person is to repay debts and is based on a variety of information, such as payment history, amount of debt owed, and types of credit used. Credit scores, and the credit reports on which they are based, influence consumer access to credit, housing, insurance, basic utility services, and even employment. The widespread use of credit scores has increased the speed with which many credit decisions can be made, the potential for customized pricing of credit, and the overall efficiency of credit granting. However, in consumer lending, inaccurate scores can result in unfair treatment of borrowers who are denied or charged high prices for credit. How to Improve Your Credit Score The trick to improving your credit score lies in staying as current as possible. Delinquent payments and collections on your credit report have a negative impact on your credit score. The more you pay your bills on time, the better your score will be. It is important to remember that paying off any collection accounts does not remove the negative impact alone. It is critical that you negotiate with the lender and get them to agree (in writing) to report the account favorably or not report it all. Another thing that you should do is pay down balances that are near their limits. High outstanding debts near credit limits send a bad signal to lenders. Don't open new accounts just for the fun of it, unless of course you are attempting to rebuild your credit with them. Be careful not to open many accounts at one go. This can backfire and lower your credit score. If you are patient, then your credit score will improve. Selecting a Lender for a Bad Credit Score Shoppers must keep in mind while looking out for lenders, it is best that they already know what their FICO score is to discuss it with lenders and get a truer picture of what rate and fees will be. A low FICO score will affect these things. Also, avoid giving your information to a lender for them to pull your credit report and get your FICO score. This reduces your credit score by 5-10 points each time. Remember Of course, once you select a lender, they will pull your credit report. If a lender tells you that you have bad credit, ask for specifics. But things can be improved once your payments are on time for a year or more, when your bad credit is considered satisfactory. |
|
| ------------------------ |
|---|
|
|
| ------------------------ |
|---|
|
|
|
|
| ------------------------ |
|---|
|
| ------------------------ |
|---|
Custom Search
|
| ------------------------ |
|---|
|
|
| ------------------------ |
|---|
Consumer Alerts | About | Bookmark Us | Contact | Espanol | Privacy Statement | Copyright | Terms & Conditions | Financial Widgets | SiteMap
Copyright © 2006 Credit Loan, LLC. 235 APOLLO BEACH BLVD, STE 218 Apollo Beach, Florida 33572 All rights reserved.
Disclaimer: The content provided on CreditLoan.com is for informational purposes only; do not make any financial decisions based on its content. Financial decisions are personal, based on an individual's situation. Consult with a financial professional before making any financial decisions. CreditLoan.com is not liable for your financial actions.
