USE CREDIT CARDS STRATEGICALLY

Credit mainteance is not crdit abstinence. Use your credt cards on small purchases because ativity is a factor in setting your FICO score. Use your credit card to pay at the restaurant, but pay the balance in full to keep your account active. Do not close old credit card accounts because it shartens your credit histor and lowers your score.

HIDDEN COSTS OF BAD CREDIT

There is no comparison of how much a mortgage interest would be for someone with a 550 credit score vs. a score of 750 higher. Why? With a score that low you are unlikely to get a mortgage. However the diffrence between a score of 620 and 750 is approximately 2% or 6% vs. 4%

BUILDING CREDIT

Keep your accounts in an active status and use the credit cart at least once a month. Most lenders want t see at least a year of activity before offering you services. Get a secured credit card and use it instead of cash. You apply your own cash to secure the card and your charge limit amounts to what you put on the card which is usually a minimum of $300.

YOUR CREDIT SCORE IS NOT

Your credit score ignores your age, salary, and occupation. It does not take into account financial gifts, support you receive or your financial assets. Credit scores are less important for borrowers who seek loans that take these factors into account.

CREDIT SCORE AND PAYMENT HISTORY

A long history of making payments on time is one of the most important items lenders consider before approving you for credit. Accounts opened for 10 years or more will help your score and improve the average age of all accounts.

HOW TO BUILD YOUR CREDIT

When realizing that it may be time to rebuild ones credit may seem impossible, it's NOT!!!

1. Start by getting a copy of your credit report.
2. Keep the accounts in active status. Use the Credit Card at least once a month. Make sure you pay the minimum payments on time each month.
3. Get a secured credit card and use it as much as possible instead of your cash. Most banks will allow consumers to get a secured credit card by applying their own cash to it.
4. Become authorized by a family member. If you can find a family member that will trust you and put you on their account as an authorized user it will show on your credit history.
5. Get a department store credit card. Store cards are easier to receive, but usually have interest rates. This is a good way to establish credit just be careful that it's usage does not get out of hand.

BUILDING CREDIT

Do not open a credit card at every department store that offers one for 25% off the purchase price. In fact adding a new card once a year and having it remain open at least 5 years is a good gauge. Late payments and excessive card debt affects beginners more than it does consumers with larger and older credit files.