Whether you are Working at Home, a salaried Professional, are Older and Wiser, or at any stage of your life, your credit can be good, or bad. No matter what you think it is, i.e. you pay your bills on time so you think it's really good, you should know as much as you can about it and how it can affect you. Seventy percent of Americans have never seen their own credit report or credit score. Do you know that you have a credit score? It's usually referred to as a FICO score. Being a Mortgage Consultant, Mortgage Broker, I've seen many credit reports and I am often surprised by the fact that my clients either don't really know they have a credit score, or they don't realize how much it can hurt them if they were inattentive to the numerous factors that make up a Credit Score. The FICO score is a summary of your credit history. In other words, it's a financial history of your life. That score impacts a surprising cross-section of life, in fact it impacts many things you knew about. Such as; " Lenders use it to evaluate your eligibility for mortgages. " Landlords use it to gauge the likelihood you'll pay the rent. " Car dealers utilize it in arrange financing for you. " Credit cards are, or aren't, given to you because of it. Now, for some things you may not have been aware of, " Insurance companies may base your premium on it. " Potential employers often use it to assess your character and they may base there hiring decisions on it. The FICO score reflects hundreds of parameters in one's financial history. " Score 700-850 - smooth loan process; best interest rates " Score 550-699 -medium risk; higher interest rates " Score 300-549 -sorry, no loans or credit cards These hundred of variables are included in the calculation of your credit score, but I only mentioned the bigger ones here. Just paying your bills on time, as important as that is, may not rescue you from other credit pitfalls. Bills, mortgages, your monthly rent, credit cards, long overdue or overlooked, can show up as a blotch on your credit. " A cable, or credit card bill, that didn't make it to your new address, or you mail them your payment, but it gets lost in the mail. It may be the store, credit card company, or post offices the error,....... but it is YOUR credit that gets hurt. " The amount of unpaid credit cards, even if they're never late. The more you owe the less credit worthy you are. " The amount of credit you already have. It's not always the More, the Merrier. " The kinds of credit cards you have, some are good believe it or not. Visa, MC, AMEX, Discover, etc. are considered good credit; others may affect your credit negatively. Such as credit extended to you at a store, or the mall when you go out and buy appliances, etc. Cancel and make sure you get rid of the bad credit as quickly as you can. " Unpaid medical services. " Collections. The amount may, or may not, matter. " The important thing to know is that credit scores aren't an exact science and these are only some of the variables. It's often not one of these items, which spell disaster for your credit; it's having a combination of these. One of these things may or may not hurt too much, but having numerous problems may mean trouble for you. It is the Credit Bureaus and the Institution extending credit to you, who decide how it affects you and your credit. |
