Tag Archives: credit scores

Is Waiting For A Bigger Down Payment The Best Option?

Down payment

Should I Wait to Put Down a Bigger Down Payment?

Some experts are advising that first time and move-up buyers wait until they save up 20% before they move forward with their decision to purchase a home. One of the main reasons they suggest waiting is that a buyer must purchase private mortgage insurance if they have less than the 20%. That increases the monthly payment the buyer will be responsible for.

In a recent article, Freddie Mac explained what this would mean for a $200,000 house:

Read more here: http://buff.ly/1O2bwSQ

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How To Attract Affluent Home Buyers…

Interesting information on the image from what Buyers are looking for and would sacrifice! Read more from my March Newsletter here: http://buff.ly/1DJDUoPScreen Shot 2015-03-02 at 7.09.34 AM

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The Benefits of Credit Repair

The Benefits of Credit Repair

Why should you Consider Credit Repair? Discover the Basic Reasons!

Do you look at your credit report and think about nothing but credit repair? If yes, then perhaps it’s high time to get your credit repair process started. Anyone with poor credit scores will definitely know what a low credit score can cost you. Wonder how severe the consequences are?

Well, high interest rates can seriously damage your finances, period. Imagine the payments you would have to make if your interest rate increases from 5% to 15%. All in all, your poor credit score can make you pay thousands of dollars additionally per year. This is the primary reason why it is critical to look at your credit report and repair your credit score. After all, it will not only lower your interest rate, but will also help you get loans.

Credit Repair – Is it Really Helpful?

When it comes to credit scores, a single mistake can cause you serious trouble. A recent research suggests that almost 79 percent of all Americans have some type of inaccuracy, miscalculations, and negative accounts in their credit reports. A majority of these errors can hurt their credit scores badly. In these situations, credit repair is the ultimate option they can get to bring their finances back on track. The process of credit repairing is used to identify mistakes, correct the relevant information, remove negative reporting and monitor the creditors to ensure that your credit report is as accurate as possible and corrected accordingly.

Better Insurance Policies

The policies most insurance companies offer are based on the clients’ credit reports. For instance, you will not get a reasonably priced insurance policy if your report suggests that you are late with paying other accounts. Thus, credit repair can clean up your credit rating and help you get substantial savings over the duration of your policy.

Better Job Options

Nowadays, many employers check an applicant’s credit history as an essential step of the employment screening process. Wonder why? Well, credit reports usually disclose what resumes may never tell. Employers check credit reports to determine if an applicant has unpaid child or spouse support, has a verdict against him or her, or pays bills promptly. In instances like these, you can get a fresh start by opting for credit repair.

Better Loan or Mortgage Facilities

A low credit score can have a negative impact on your ability to get different loans. You may not get the desired loan amount or may have to make greater interest payments on the lifetime of your loans. If lenders find a poor credit score on your report, they can lower your credit limit, thus making the loan even more expensive for you. If dealerships turn you down for loans or offer very high interest rates, you have to consider going for credit repair. This will increase your chances to get your desired vehicle or own your dream home.

Since credit scores and credit reports can affect you and your loved ones in a number of ways, it is important to keep your credit score in superb condition. Credit repair doesn’t only benefit individuals with a low credit score, but can do wonders for people with average credit by getting negative items off of the reports, disputing late payment information and correcting any inaccuracies on your report.


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Credit Card Tricks!


Credit limit tricks: Keep a high score while still using your card
Forget the old 30% rule; just know when your credit ‘snapshot’ is taken
By Dana Dratch

Here’s an axiom familiar to borrowers: Using too much of your available credit hurts your credit score. A personal finance rule of thumb that goes with it says that for a good credit score, keep your “credit utilization ratio” — what you use versus how much you have to use — below 30 percent. The rule applies to each card individually, and to the cumulative limits of all your cards.

So if you have a card line with a $10,000 limit, for the best credit score, don’t carry a balance higher than $3,000. Simple, right?

Sorry, but no. Your credit limit has fewer hard-and-fast rules than personal finance bromides would have you think. Knowing its tricks can get you a better credit score and keep money in your pocket.

Forget the old 30% idea
Start by throwing out the old notion about 30 percent usage being OK. FICO, the company that originated credit scoring and is still the largest provider of such scores, has long advised score-conscious consumers to be far more stingy about credit use. The company had told people to keep it to 10 percent or less, says Anthony Sprauve, spokesman for myFico.com, FICO’s consumer website.

More recently, the company’s stance has softened he says. Its studies indicate that there is only a minimal score difference between consumers who limit their usage to less than 20 percent and those who keep it to less than 10 percent, he says.

That can be good news for consumers who want to actually use lower-limit credit cards for more than token purchases.

According to FICO surveys, credit scoring “high achievers — those with a score north of 750 — they’re using an average of 7 percent of their available credit,” Sprauve says. “I think 20 percent, for a lot of people, is more realistic. I would rather talk about that as a realistic goal that they can attain, rather than something that might feel like a stretch and out of reach.”

And remember that credit scoring formulas are closer to a sliding scale than a cliff. You don’t go from a great score at 20 percent credit utilization to a lousy one at 21 percent. “There’s no hard-and-fast guideline,” Sprauve says. “But I think that if people stay somewhere between 10 and 20 percent range, that’s a good place to be.”

It’s still true that you shouldn’t go rack up debt on any one card. The FICO scoring system looks at “the total available credit and the total balance used,” says Sprauve. “But it also does look at individual lines of credit. So it factors in both.”

FICO, VantageScore differences
FICO’s chief alternative, the VantageScore, is a bit more lenient in how it views utilization ratios. FICO counts credit usage as 30 percent of its overall score. In the VantageScore universe, the ratio makes up about 23 percent of the score, says Sarah Davies, senior vice president of research and analytics for VantageScore Solutions.

To keep it strong, aim for using less than half of your available credit lines, says Davies.

“If you keep your balance below 50 percent, your score is not negatively affected,” she says. And keeping it “below 30 percent” is smart, she adds. And, as with the FICO models, the lower your utilization (above 0), the more benefit your score can see, she says. Also, as with FICO, how much a change in the utilization rate affects the score will vary by person, depending on their individual credit history.

There’s no hard-and-fast guideline. But I think that if people stay somewhere between 10 percent and 20 percent range, that’s a good place to be.
— Anthony Sprauve
If you like VantageScore’s attitude toward credit usage better, that’s nice, but you don’t get to pick which score lenders use. VantageScore is used by less than 10 percent of the lending market, says Craig Focardi, research director for the TowerGroup.

Maximizing your credit score
Want to keep that score as high as possible while still using your cards? Here are four ways:

1. Use a card that doesn’t report utilization ratios. Some true charge cards (cards where the full balance is due every month) don’t report card balances to the credit bureaus. The best way to find out if yours does: Call the card issuer, says Sprauve. And if your card doesn’t report monthly card charges, you don’t have to worry that using more of your credit line will affect your score, he says.

2. Time your payment. You can appear to be carrying a balance, even if you’re not. That’s because card issuers report your balance owed to the credit bureaus on the same day every month, says Norm Magnuson, vice president of public affairs for the Consumer Data Industry Association, a trade association for credit reporting companies. That day probably isn’t your payment due date.

Think of it as a monthly snapshot of your credit use. You want to look as pretty as possible to the credit bureaus on that day. If you’re carrying a $2,000 balance on the 10th of the month, when the snapshot is taken, it doesn’t matter if you pay it off on the due date on the 15th. The report to the credit bureau will say you were using a chunk of your credit, and that may blemish your score.

The solution: Find out what that day is, and pay any portion over your target usage amount before then. Phone the issuer and ask, “When do you send down that accounts receivable tape to the credit bureau?” says Magnuson. “I don’t see why they’d have a problem with answering that. It’s a straightforward question.”

3. Pay your bill several times a month. Want to make certain you’re always under your usage goal while still getting the most out of your cards? Try making payments weekly or twice a month. That will always suppress your balance, no matter when the credit bureau snapshot is taken.

But be careful: If you pay before the statement date, it could be counted as part of a different billing cycle, says Paul Westen, president and CEO of TCM Bank, the card issuer for many community and independent banks. You could still have a bill due in a few weeks, he says.

The smart move: Call first and find out how the billing department handles multiple monthly payments, along with what information you need to include when you pay.

4. Request a credit line increase. If you use a set amount every month and want that amount to equal 10 or 20 percent of your credit line, one way to make the math work is to increase the credit line, says Westen. “Creditors no longer give automatic credit line increases,” he says. Instead, the onus is on the consumer to ask for more credit.

Utilization ratios aside, if you’re paying that balance on time and in full “every month for a period of time, most issuers will have you at the most attractive rate,” says Westen. If they don’t, then switch cards, he advises.

Read more: http://www.creditcards.com/credit-card-news/credit-limit-utilization-ratio-use-charge-1267.php#ixzz2Lkzv8d6F
Compare credit cards here – CreditCards.com

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