Is Your Credit Score Part of the 50%? Take a Look

How does your credit score rate? In a recent report compiled and released by Experian, the average U.S. consumer’s VantageScore is 749 (Experian Information Solutions, Inc., 2011). That is on a scale of 501 – 990, with higher scores indicating better credit (see scale breakdown below). A = 900 – 990 [1] B = 800 – 899 C = 700 – 799 (this is where the average credit score ranks) D = 600 – 699 F = 501 – 599 In analyzing the scores of consumers Experian grouped data by geographic location. It turns out that eight of top 10 states, with the highest average credit scores, are located in the Midwest. These include areas in Wisconsin, Minnesota, Iowa, Illinois and South Dakota. Of the 10 cities with...

Posted on Nov 03, 2011

Marriage - Love and Debt

What happens to your credit when you get married? If your spouse has good credit, does that help yours? If your spouse has bad credit does that negatively impact you? These are questions that I often hear when I am out teaching classes. The answer is pretty straightforward; however there are many things to think about when combining finances with someone whose credit has blemishes. First, let's put some misconceptions to rest. When you get married, your credit does not become one. It is still separate. The debts that were yours prior to the marriage are still your responsibility and they will not show up on the credit report of your new spouse. There are only a few ways for you to...

Posted on Sep 13, 2011

What Does Your Employment Report Show? Find Out for Free

In the hundreds of financial education classes I have taught, we always discuss how to get receive a copy of your free credit report. But did you know there are numerous other reports out there that may contain your personal information? Today we will talk about just one of those other reports – employment screening. If you have applied for a job in the last few years, chances are you have been asked to allow the employer to check your background. A background check can include your credit report, criminal and public court records, previous employment history, educational background, property records, marriage, birth, and death records, and, if applicable, your driving record. When you apply for employment with an organization that conducts...

Posted on Aug 07, 2011

Turned down for a loan or a job? check your credit report

Turned down for a loan or a job? check your credit report Today, our credit reports are used to make many decisions about our financial future. This includes auto insurance rates, employment opportunities, ability to rent a home or apartment and, of course, whether we can obtain a home, car or credit card loan. It is critical to protect this very important asset by reviewing it, at least, annually. One study by the U.S. Public Interest Research Group found, “One in four credit reports contains errors serious enough to cause consumers to be denied credit, a loan, an apartment or home loan or even a job.” No one wants an error to prevent them from obtaining employment, or getting the best...

Posted on Aug 04, 2011

CREDIT REPORT REVIEW CHECK LIST

Many people tell us they pull their credit report, but are not sure what they should be looking for when they review it. This checklist is designed to help you identify and review the most important areas of your credit report. Are your name and any other “known as” names correct? Is your social security number correct (if showing)? Is your address correct? Is there anything listed in the public records information? If so, is it correct? Is there anything listed in the collection agency account information? If so, is it correct? Are the dates on collection agency accounts correct? Are any collection agencies on the report older than seven years? Review each item under the credit account information. Are the accounts showing the correct status (open or...

Posted on Aug 04, 2011

Credit Scores Become Even More Mysterious

On Tuesday, the Consumer Protection Bureau (CPB)  [1] released the results of a study on credit scores. What they found makes credit scores even more confusing than we already believed. According to the study, the credit score you receive from the national credit bureaus (Experian, Equifax, and TransUnion) will not be the same score your lender receives when it requests your score. Why? The answer is that the credit bureaus and your creditors may use different scoring models. The most common scoring model is the FICO (Fair Isaac and Company) score. FICO is widely used in the mortgage and auto lending industry. According to a 2011 report by CNN [2], 90% of the scores sold to creditors are FICO scores. When you request...

Posted on Jul 18, 2011

Get Your Credit Score - Coming Soon!

Earlier this year we brought you the news of the new Risk-Based Pricing Rule which requires creditors to disclose your credit score to you when that score is used in setting or adjusting credit terms, or to deny you credit. Now the Federal Trade Commission and the Federal Reserve Board have announced final changes to this new law. The most important change for consumers is the requirement that lenders must now disclose to you when they are using a credit score that was developed specifically for that business. This is important because there are many credit scoring models used in the lending industry. The credit scores available to us now (for a price) are not the same scores that lenders...

Posted on Jul 11, 2011

Are You Hurting Your Child's Credit? Get the Report

I have been getting a lot of questions lately regarding what to do if you suspect your minor child’s identity is being used to obtain credit. With the credit tightening and job losses we’ve experienced over the last three years, many people have become desperate when trying to turn on utilities or rent somewhere to live and have resorted to using a child’s name and Social Security number to start accounts. This is completely illegal and may even result in a jail sentence for the offender. If you suspect that your minor child’s information has been used fraudulently, contact law enforcement to report the illegal use of their credit.  Then follow up with the credit reporting agencies and request a...

Posted on May 30, 2011

Top Ten Ways to Save Your Credit!

1. Put down the card! Unless you really will pay that credit card purchase off before the next statement, don’t use it! 2. Send in the payment. Pay all of your bills on time and if you cannot, contact the creditor to make arrangements. Avoid having debts sent to collections. 3. SAVE for big purchases rather than using credit. If you know your washing machine is on its last legs, start saving! $100 a month for a few months and you can buy a great (machine, stove, lawnmower, drill, etc.) item without using credit and you’ll pay no interest! 4. A variation on #3, rather than open new credit to purchase a big item, use existing your existing credit lines. Numerous open lines...

Posted on Mar 14, 2011

Top Ten Ways to Mess Up Your Credit

Pay your credit card bills, at least, 30 days late. Don’t bother keeping balances low – make sure your credit cards are maxed out! What is credit for, if not to use it! More late payments! Pay car, home, or student loan payments, at least, 30 days late. Rather than save up for things you want, grab it now by opening up new lines of credit! (Spring is just around the corner and you could use a new wardrobe/barbecue/vacation!). Who needs to pay traffic tickets, medical bills, or even utility bills? Forget about them and they’ll end up with a collection agency – a definite black mark on your credit report. Never check your credit report. Doing so will only alert you to problems on...

Posted on Feb 27, 2011