Credit is a tricky subject because we don’t have the secret key that unlocks the proprietary information or formula of the credit bureaus and Fair Isaac Corporation. They created the scoring modules that are in use today to create credit scores on the information in your credit file. However, through exhaustive research and intensive study, we have come to see the secrets and tricks the credit bureaus use and understand how it works… almost.

Because there are hundreds of factors involved in creating a scoring module and how it affects the information in your credit file, it is difficult to ascribe a perfect number of points to what a tip or strategy will do to increase or decrease your credit score. However, this much we absolutely do know… that if you do follow the tips and strategies in this book then you will see a rise or fall in credit points depending on if the action is a good action or a bad action on your part.

Take heed to read the tips and strategies and relate them to your own credit file and the information contained in it. Read it, get to know it and then read the strategies to use to get your scores going up instead of down. This will help you get the highest scores possible and create an opportunity for a great financial future . Now, go and get start and remember, that Every Point Counts!

There are 5 areas of importance in the scoring modules of the credit bureaus.

They are:

1 – Bill payment history – 35% of your score is attributed to this section.

2 – Account Balances – 30% of your score is attributed to this section.

3 – Length of time opened – 15% of your score is attributed to this section.

4 – New Accounts – 10% of your score is attributed to this section.

5 – Types of credit used – 10% of your score is attributed to this section.

Terms:

Creditor = the company that extended the credit to you.

Payee = the company that you make the payments to.

Payer = this is you, the person that makes the payment to the company (Payee) that you owe.

Your ability (or lack of) to borrow money or have credit extended on your behalf is one of the most important assets you have, especially in today’s economy. Your credit score is considered to be a very important factor, not just by potential lenders, but may be by potential employers and even landlords. If your credit score is low, you will have trouble not only borrowing money, but will also find difficulty getting a job or renting a decent apartment or home. You can learn the steps to becoming a better borrower to improve your score and qualify yourself for better loans and credit cards.

Your FICO Score Determines Creditworthiness

For those needing any type of credit now, the process and successful is bleaker now than ever before due to the recent credit crunch and global financial crisis. But the determining factor in whether or not you will receive the loan that you need – and how much the credit will cost you in terms of interest – is your FICO score.

Your FICO credit score repair forum is a number between 300 and 850, and is used to communicate your credit history and behavior to potential lenders before they decide to extend money to you. You could consider the FICO scale an index that gives the lender a glimpse at the risk he may or may not be taking if you are approved for the loan you want. The higher your FICO score – the higher your chances of getting approved for the credit you desire, and the lower your interest rate will be.

What Potential Creditors Look For

Your score is a tell-all when it comes to your credit. The biggest thing that potential lenders look at is your payment history – or more specifically, the timeliness of your payments. Paying on time is the easiest way to add points to your FICO score. Another thing that creditors look at is how much credit you use each month as compared to how much you have available for use. In general, this should be no more than thirty percent of your available credit lines, across the board, with all sources of credit considered. Overall the lower your outstanding balances the better, getting under 10% is best on individual credit cards. Creditors also look at the length of time that you have an account open – in this case, the older the better.

Having an account in good standing for several years is very appealing to potential creditors because it shows them that you are a responsible and trustworthy borrower. The number of credit inquiries that have recently been run when you apply is also looked at. Potential lenders do not like to see multiple attempts within just a six month or so period. Applying for too much credit is very detrimental to your credit score – it gives the impression that you are on the prowl to borrow from anyone and everyone.

Can You Rebuild Your Credit?

For those with damaged credit who are looking to rebuild their credit histories getting the services of a licensed legal professional is almost always the best route to take. If your time, return on investment, as well as results are important, the hiring of a professional is most always the best option.

Herschel

There are many opportunities to start establishing credit for you. Some people have no problem applying for a credit card or signature loan from the beginning. Let’s establish why and what you can do to get yourself in that position.

Someone who has a steady job and worked there for a long time has established a history of stability. They aren’t jumping around with different jobs and show that they are valued as an employee.

Someone who has only one residence on their credit file also shows stability and has established that they are not flighty or other serious problem with staying stable in one location. These points are well considered when applying for credit of any kind.

I have also established that living in a particular area has an effect on credit score and whether you can get a loan simply because of where you live. It is not pronounced, but could become a big factor in the future. The factors involved are if you live in a rough section of town or if you live in an affluent section of town. The credit bureaus my credit repair collection agency credit are gathering enough data now to be able to determine enough fact to consider this in the now or in the near future.

If you have recently come out of bankruptcy, you’ll find your credit score could no doubt use a quick boost. Getting your financial picture back in order once you have had a bankruptcy discharge can be a tricky task – but nevertheless, it can be done. Following these quick tips can get your score elevated to the point that you qualify for great loans and lines of credit offered at substantially reduced interest rates in a relatively short time.

Begin Adding Points Immediately

You can begin adding points to your credit score almost immediately upon having your bankruptcy discharged by taking on small and manageable amounts of credit. Before doing so, however, you should check your newly updated credit report. Since there are three major credit reporting bureaus operating in the country, you should retrieve your credit report from all three credit bureaus to determine if the accounts that you included in your bankruptcy proceedings have been noted as such. In addition, you’ll want to get your FICO credit scores to know your starting point.

Sometimes, a creditor will fail to report the change from collections to discharged in bankruptcy, and the item will remain on your credit report – making your credit score dip even lower. Contact the credit bureau and disputing these items that is holding the report immediately upon recognizing this error to have it corrected is a prudent start. .

The Most Important Accounts You Can Open Now

Almost all creditor applications ask where you do your banking and while there are many different accounts that you might consider opening to add points to your damaged credit score. Perhaps the most important two are not accounts that extend credit, but rather just make you look like a more responsible person, and therefore, a more appealing borrower – a checking account and a savings account.

Secured Credit Cards Add Points Fast

You should open up a secured credit card account as soon as possible when your bankruptcy has cleared the courts. A secured credit card is just like a regular credit card in that it reports either monthly or quarterly to the credit bureaus – the difference is that you will place a deposit equal to the amount of credit that you wish to have extended on your behalf with the card issuer.

Maintaining a good payment history with your new secured credit card is one of the fastest ways to add valuable points to your credit score. You might consider opening more than one account to maximize the number of points you can add – just make sure each card is with a separate bank. You can open a secured credit card account with as little as three hundred dollars, which is a very small investment to reap such great benefits. No, a three hundred dollar line of credit is not where you want to end up but it is a great start to turning things around.

Unsecured credit cards

There are several institutions that will extend you a small line of credit shortly after a bankruptcy. The reason is that these banks believe, what is a better time than now to help a person out right after they have come out of a bankruptcy and had all or most of their debts wiped out. This means more disposable income and a greater chance of repayment in their eyes. These cards will typically be granted at $300 to $500 credit lines to start.

You can find some great deals on secured and unsecured credit cards online via the Internet. There are many lenders who specialize in these types of cards for borrowers who are in your same situation. The interest you pay will be higher than going to your local bank and getting their platinum gold plated credit card but the benefits you’ll gain by rebuilding your credit far outweigh the extra few dollars the interest may cost.

Sound charging practices though are required… but I guess that’s another day!

Herschel