Pump up Your Credit Report Score for a More Fulfilling Financial Future |
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How is your
credit report score? Does it hold you back from the things you would like to have? Or is it good, but something you think you could pump up a bit to get an even better financial outlook? Many Americans have average credit reports, with credit report scores in the range of 630-670. Scores in this range are often OK to get loans, but for much better interest rates, it's necessary to up your credit score to the next level: 670-720. Here you can demand better interest rates and terms. The first thing to do in increasing your credit report score is to look at your budget and see where your money is going. Look at ratios: how much of your income is going to credit card payments? How much do you pay to credit cards, and how much is the minimum payment? Can you pump up the amount you pay against your credit card balances, with an eye to pay them off, instead of simply maintaining the balances at a workable level? The next thing you need to do in your program of improving your credit report score is get hold of your credit report from a reputable credit reporting agency. The Big Three credit reporting agencies are Experian, TransUnion, and Equifax. All three, by the end of 2005, will offer a free copy of your credit report once per year. Also, you are able to get a free copy of your credit report from a credit reporting agency that provided it to a credit grantor who has denied you credit in the last 60 days. There are also many other criteria for obtaining a free copy of your credit report, these are posted online at www.FTC.Gov/credit. Once you have obtained a copy of your credit report, you should review it carefully for errors or omissions. Make sure all positive information has been entered, and make sure any negative information is correct. You can't get negative information removed from your report, but time will take care of it eventually, and you should work to lessen its impact by adding as many positive items as you can. This means you have to work hard to build a positive credit profile. The primary way to do this is to ensure your bills are well within your means, and that they get paid on time or early. Credit cards do not have to be charged up to their limit; this is a negative item on your credit report. As a matter of fact, some people, especially after having a bad experience with credit, often cut up cards and close out credit accounts they have had bad luck with. Little could be worse. Your credit reports score doesn't look at the balance of your credit card account (unless it's too high vs. the limit) so, if you keep the balance at or near zero, and keep it paid, it's the same value to your credit rating as if you owe $5000 and keep the payments on time. But is easier to keep a very low (or zero) balance paid! Should you get into financial trouble, you must work to mitigate the damage as soon as possible. Contact your creditors and tell them your situation honestly. Work out payment plans that are within your new budget if necessary. Do all in your power to stay out of Bankruptcy or default on your loans, as the new bankruptcy laws are of much less help to the average consumer, and bankruptcy is a powerful negative hit against your credit report score. So are foreclosures, collections and judgments. Take the above advice and you will steward your way to a positive credit report profile and high credit report score that will enable you to have many or all of the things you want, since good credit can be your most formidable financial tool. |
