101 Fast Fixes to Boost Your Credit Score: And Navigate the Credit Score Maze

101 Fast Fixes to Boost Your Credit Score

And Navigate the Credit Score Maze

Melissa L. Walker

Copyright ©2014 by Melissa L. Walker

MLW Marketing

4141 N. 108th St., Kansas City, KS 66109

ISBN:  978-1-312-10245-3

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Introduction

There are many misconceptions about credit scores. Many individuals believe that they do not have a credit score or think that their credit scores just don’t really matter. These sorts of misconceptions can hurt your chances at employment, good interest rates and even your chances of renting a place to live. The truth is, if you have a bank account and bills, then you have a credit score.  Your credit score matters more than you might think. A credit score may be called many things; including a Credit Risk Rating, FICO Score or a Credit Risk Score.  All of these terms refer to the same thing, the three-digit number that gives lenders an idea of how likely you are to repay your bills.

Every time you apply for credit, apply for a job that requires you to handle money or even apply for the rental of an apartment, your credit score is checked. In fact, your credit score can be checked by anyone with a legitimate business reason to do so.  Your credit score is based on past financial responsibilities, past payments and credit.  It provides potential lenders with a quick snapshot of your current financial state and past repayment habits.  In other words, your credit score tells lenders, quickly, how much of a credit risk you are.  Based on this credit score, lenders decide whether to trust you financially and give you competitive rates when you apply for a loan. Apartment managers may use your credit score to decide whether you can be trusted to pay your rent on time.

Employers may use your credit score to decide whether you can be trusted in a high-responsibility job that requires you to handle money.

The problem with credit scores is that there is quite a bit of misinformation circulated about them. Especially through some, less than scrupulous, companies who claim they can help you with your credit report and credit score. From advertisements and suspect claims, customers sometimes come away with the idea that in order to boost their credit score, they have to pay money to a company or leave credit repair in the hands of so-called experts. Nothing could be further from the truth. It is perfectly possible to pay down debts and boost your credit on your own, with no expensive help whatsoever.

In fact, the following 101 tips can get you well on your way to boosting your credit score and saving you money.

By the end of this book, you will be able to:

•Define credit score, credit report and other key financial terms

•Develop a personalized credit repair plan that addresses your unique financial situation

•Find the resources and people who can help repair your credit score

•Repair your credit effectively using the very techniques used by credit repair experts

Plus, unlike many other books on the subject, this book will show you how to deal with your everyday life while repairing your credit and teach you the powerful strategies you need to build the financial habits that will help you to a keep a high credit risk rating.

Start reading and be prepared to start taking small but powerful steps that can have a dramatic impact on your financial life!

The Basics

Before you attempt to increase your credit score, you need to know the basics. You need to know what a credit score is, how it is developed, and why it is important to you in your everyday life.

Lenders certainly know what sort of information they can get from a credit score, but knowing this information yourself can help you better see how your everyday financial decisions impact the financial picture lenders get of you, through your credit score. A few simple tips are all you need to know to understand the basic principles.

Tip #1: Understand where credit scores come from

If you are going to improve your credit score, then logic has it that you must understand what your credit score is and how it works. Without this information, you won’t be able to, very effectively, improve your score because you won’t understand how the things you do in daily life affect your score. If you don’t understand how your credit score works, you will also be at the mercy of any company that tries to tell you how you can improve your score - on their terms and at their price. In general, your credit score is a number that tells lenders how much of a credit risk you are. The credit score is a number, usually between 300 and 850, that tells lenders if you pay your debts on time and how much of a credit risk you are. In general, the higher your credit score, the better credit risk you are. Scores in the low 600s and below are often less desirable to lenders.  While scores of 760 and above will generally give you the best interest rates available. However, credit scores are a lot like GPAs or SAT scores from college days - while they give others a quick snapshot of you as a credit risk, they are interpreted by different people in different ways. Some lenders put more emphasis on credit scores than others. There are lenders that will work with you if you have a lower credit score, while others offer their best rates only to those consumers with very high scores.

Your credit score is based on information in your credit report, which contains a history of your past debts and repayments. Credit bureaus use mathematical calculations to arrive at a credit score from the information contained in your credit report.

Each credit bureau uses different methods to do this (which is why you will have different scores with different companies) but most credit bureaus use the FICO system. FICO is an acronym for the credit score calculating software offered by the Fair Isaac Corporation. This is, by far, the most used