Manage Your FICO Credit Scores
Posted: Thursday, October 08, 2009
by Louis Jeffries
http://healthyweightloss4babyboomers.com
The days of easy credit are long gone. With the economy being in turmoil and the banking system suffering massive losses over the last couple of years it is so important that we are diligent in managing our credit and managing our credit scores. To qualify for a home mortgage, have a car financed and even get a credit card today requires a higher credit score than years past. Therefore it is so important that we make sure our FICO scores are as high as they can be.
Many people falsely believe that just by paying their bills on time they will have a good credit score. This is the furthest thing from the truth. As a matter of fact your payment history only accounts for 35% of your FICO score. There are people who are never late on their bills with a 600 score and some with an 800 score. These 7 guidelines below will help you improve your FICO credit score.
>1. Reduce the balances on your credit cards.
>2. Increase the limits on your credit cards if you can.
>3. Do not close an account even if you no longer use it and it has a zero balance. Longer history of having an account increases your score.
>4. Monitor your history with an credit and identity monitoring service.
>5. Limit inquiries to your accounts.
>6. Don't apply for credit needlessly. Excess credit lowers your score.
>7. Review your credit reports annually for errors and dispute any negative items.
These seven tips can help you keep your score high and help you qualify for financing and get the best rates available.
Risk Based Pricing.
This is not a new concept but it is very prevalent in today's market. What risk based pricing means is that lenders access the risk and price accordingly. Your credit score is a primary factor and may be the only factor that the lender uses to determine the risk of extending you credit. Therefore, the higher you score the lower the risk. The lower the risk the better the pricing. Conversely a low score will cause you to pay much more for the same services. This is why it is so important to manage your credit and your score.
Your Mortgage.
As a mortgage banker for over 20 years I have never seen credit as tight. In the past with a stable job, on time payments and affordable payments based your your income and existing debt you would qualify for a mortgage. But with the advent of technology and the easy credit programs that backfired, credit is tighter than ever before. Worse than that people who have always been faithful to pay their bills on time are suffering. As we fight to change the system by supporting politicians whose plans will make this an equitable playing field, we must learn to ensure we get the best financing options possible. That means focusing our efforts to manage our credit and our scores based on the 7 tips above. This way you can get the best credit score and the lowest rates possible.
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Legal Credit Repair is a right not a privilege. Whether you do it yourself or hire a professional you have the right to have inaccurate and improperly reported information removed from your credit bureau report. For more information on legal credit repair send me an email to louisj@howtogetthebest.com or or go to CREDIT REPAIR I will follow up with you and send you a free credit newsletter.
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