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A Great Credit Score is in your Future!

Credit Score

If you haven’t had a chance yet to establish a strong credit score, you may be wondering how to go about doing so. Luckily, there are a number of ways you can begin building your credit score so you enjoy the many benefits of a strong FICO score.

Here’s what you need to do to begin your journey to a strong credit score:

• Order a copy of your credit report from all three major credit reporting agencies. Although you may think your credit report will be virtually blank, mistakes do happen and it’s possible that there are errors on your credit report. You are entitled to a free copy of your credit report from the credit reporting agencies once a year so take advantage of this opportunity and order them today!
• Once you have checked your credit report, you must open a checking or savings account. Lenders of any kind like to see an active bank account, as it shows financial stability. Plus, it provides you with a means to pay on monthly bills and debts.
• Understand the factors that credit reporting agencies take into consideration when determining your credit score. Understanding that your credit score is made up of a number of factors, including payment history, payments and the ratio of debt to income, will better help you build your credit score.
• Start with a secured credit card to begin building your credit history. Secured credit cards are essentially credit cards that are secured with a cash deposit. Once you have established a history of regular payments with a secured credit card you can likely apply for – and be approved for – an unsecured credit card.
• Don’t think just in terms of credit cards when considering your credit score. In fact, lenders and credit reporting agencies look at your payment history on other types of monthly bills, including student loans and utilities, just to name a few. In other words, be responsible when paying any type of monthly bill or debt, as it could reflect poorly on your credit score if you don’t.

Important Facts about Secured Credit Cards

Introduction

Many of us, in an effort to improve our damaged credit scores, may apply for secured credit cards. Secured credit cards are often a smart way to begin showing the credit reporting agencies that you are taking responsibility for your credit woes and attempting to repair them.

However, it is important to remember that all secured credit cards are not created equal, and that it is important to take the same precautions applying for a secured credit card as you would an unsecured credit card. Here are other important facts you should know about secured credit cards:

• Not all secured credit card companies will report your credit activity to the credit reporting agencies. Make sure, when applying for a secured credit card, that you choose one that will report your credit activity to the credit bureaus. Otherwise, don’t waste your time. You will often find this language in the credit card’s terms and conditions, but it is also important to call and verify this information with someone from the credit card company before accepting the credit card.
• Just like unsecured credit cards, it is very important to read the fine print on a secured credit card. Some secured credit cards come with super-high fees, such as activation fees, credit increase fees, monthly maintenance fees, balance inquiry fees and ATM fees, so take the time to look over the terms and conditions for a few secured credit cards to ensure that you are paying as few fees as possible.
• Don’t forget to look at the interest rates on secured credit cards. Once you have examined the fees associated with a few secured credit cards (and eliminated a few), you will want to pay close attention to the APR. Although you may receive zero-percent introductory rates, you will soon find that the credit card’s default rate once the promotional rate has ended is much, much more.
• Don’t expect to be approved for every secured credit card for which you apply. Some banks are quite particular, even when it comes to secured credit cards. For example, some banks won’t approve individuals who recently filed bankruptcy.

Useful Information about the Fair Credit Reporting Act

Credit Repair Introduction

What you don’t know about the Fair Credit Reporting Act could cost you.

The Fair Credit Reporting Act (FCRA), which is enforced by the Federal Trade Commission, is a federal act designed to ensure that consumers’ privacy is protected and that the credit reporting agencies maintain accuracy and abide by certain responsibilities.

Perhaps one of the most important features about the FCRA is that consumers are entitled to a copy of their credit report from all three, national credit reporting agencies – Equifax, TransUnion and Experian – once a year.

There are also other instances in which you may be entitled to a free credit report:

• - If you have been denied for credit, insurance or employment (you must ask for a copy of your credit report within 60 days of being denied)
• - If you are unemployed and plan to begin looking for a job within the next 60 days
• - If you are on welfare
• - If you have been a victim of fraud or identity theft

Under the FCRA, you also have rights regarding inaccuracies which appear on your credit report. The credit reporting agency in which the inaccuracy appears, as well as the creditor who provided the information, have an obligation and a responsibility to investigate and correct the inaccuracy within 30 days.

Simply inform the credit reporting agency in writing. The credit reporting agency must then forward the information to the creditor, who must then investigate and review the information and report back to the credit reporting agency.

Upon resolution of the inaccuracy, the credit reporting agency must provide you with the written results of the investigation, as well as a new copy of your credit report (if the dispute results in a change on your credit report).

Finally, the FCRA recognizes that the only individuals who can obtain a copy of your credit report are those individuals with legitimate business needs. In addition, your employer may only access your credit report upon your approval.

If you have experienced violations of the FCRA, you should report it directly to the Federal Trade Commission at:

Consumer Response Center — FCRA
Federal Trade Commission
Washington, D.C. 20580.