Credit Card Watch

How To Repair Your Credit And Why It’s Important To Do So

Your credit score is never on display until it needs to be. People that you work with or socialize with will never know your credit score, they aren’t lending you money and if they do it’s never really documented.When you need to borrow money from a bank or creditor your credit score flashes like a bright neon sign to a lender, it’s then that you know what your credit score is. If it’s not as high as you would like for it to be, which is above 700 for a great score, there are things you can do to raise it so you pay less interest and save money.

Your credit report is a recap of your payment history. From the very first credit card or department store card you opened to produce revolving credit and establish you as a good candidate for loaning money to is listed on your credit report. It’s basically a report card of your payment habits. Not everybody’s credit score is good, bad things happen to good people and life tends to happen when you least expect it. That’s okay, you can still raise your credit score, there are some things you need to know that will help and hurt your attempt.

First, you need to find out what your credit score is. Many people who want to buy a house save up their money for a down payment; they go to their lender and request the rest of the money so they can own their own home. In the meantime they might have had some bad borrowing habits and their score isn’t as high as the bank would like it to be. They people find out what their credit score is, it might be a sinking feeling or a joyous one. Knowing what your credit score is can be paramount. You have a right to your own payment information, take advantage of it. Your bank can even get you a copy of your credit history. Don’t be shocked; know what’s in your credit report.

If your credit score is low, and lenders will tell you what is good, then you need to take action to raise your score. Request a copy and look it over, in full display will be all of your past actions with credit. Some accounts will be old and some will be fresh and those are the ones you want to take care of. Since there are three credit reporting agencies you might want to get a report from each, they all have slight variances of information but most report the same creditors and payment history.

In order to raise your score you will need to settle old debts. Although you might pay off a debt the credit history will remain on your credit report for up to 7 years. It will take time for the creditors to update your information so a letter stating that you have settled a debt in full is helpful to have available. Having a lower credit score means that you are a risk to lend money to and you will pay a higher interest rate, it doesn’t matter what you are borrowing for, a house, a car, furniture, and creditors make the rules on who they will lend to.

Don’t close an old account just because it’s been paid off. The fact that you were given credit is a plus, how you handled that account is indicative of how you might handle the same type of account. Your credit report does not list how much money you make, it is a credit history not a paycheck snapshot. Keep accounts open that show good standing, this proves that you are able to pay off debt and keep a revolving amount without going over the limit.

Even if your score is good you can still borrow money to buy a home or car. Your interest rate is where you will save money over a person who has bad credit. A great credit score is rewarded with low interest and sometimes no money down. A poor credit score is penalized with high interest and even though you might need to borrow the lender is going to get paid for his taking a risk. Don’t try to open smaller accounts to raise your score either; too much credit is a temptation that lenders don’t want to fall into. Creditors take risks everyday lending to people based on their credit history. Having a higher score allows you a freedom from high interest rates and fees. It pays you to find out what’s in your credit report and to fix any discrepancies.

I love helping people attain the dream of owning their first homes with Florida FHA Loans, VA Loans, Florida Rehab and Hard Money Loans, and USDA Loans for agriculture. If you are looking to purchase Florida Real Estate or real estate in any of the 50 states and need assistance attaining a home loan, please contact me. I will hold your hand every step of the way to help you get the house dreams are made of.