We’ve recommended that students get credit early and use it wisely to establish a healthy credit record.
Unfortunately, that’s easier said than done. There’s a reason laws like the Credit CARD Act of 2009 get passed: students averaged over $3500 in credit card debt, with 85% of cardholders carrying a balance from month to month and paying hefty fees and interest.
Many collection agencies cast a wide net when trying to collect on old debts. You may get a letter that was intended for someone else, perhaps someone with a similar name. It’s important to deal with this issue promptly.
When it comes to your credit report, you have the right to add a personal statement. This statement can be up to 100 words long and gives you the opportunity to explain information in your file.
Here at Springboard, a former client was excited to tell us that her credit score was 723. That’s a respectable score, and much higher than she expected given her credit history. Another consumer who had recently been the victim of identity theft checked her credit and was ecstatic to learn that her score was right at 800, which is as high a score as anyone needs.
Unfortunately, they had both been misled. Their scores weren’t nearly as good as they thought.
Two important sections of your credit report are the “Public Records” and “Inquiries” sections. Knowing what personal and public information that is on your report is an important factor to taking control of your finances. It is also important to know what companies have requested a copy of your report.
The third step in this series is to review all of the information contained within the public record section of your annual credit report. Public information and inquiries are usually the last sections to appear in your credit report, though each credit report company does things a bit differently.
Personal information may be the first thing to appear in your credit report, though each credit report company does things a bit differently.
While this personal information has no direct impact on your credit score, it’s very important that everything reported here be accurate and up to date. The credit bureaus use this information to verify your identity, and if anything here is incorrect or outdated, your security may be compromised.
Let’s begin with the Account History section which may not be the first thing you’ll see when you open your credit report, but it is the most important. It’s usually the largest section of the report, as well. When calculating your credit score, FICO gives more weight to your payment history than any other category.
For an individual, a debt ratio describes the percentage of your income that goes to debt payments. You’ll often see this described as a Debt-to-Income Ratio.
Your ratio is usually calculated based on your gross income. So if your salary is $3,000 per month, and your total debt payments every month are $300, your debt ratio is 10%. (3000 divided by 300 is 10).
In honor of Financial Literacy Month, we’re urging consumers to make a pledge to save. We’ve learned that taking positive action to achieve your goals is much more effective than passively hoping for success.
Typically, people think of identity theft as a theft one’s credit information. Someone gets a hold of your credit card, pretends to be you long enough to use the card, and your identity has officially been stolen.
Sometimes having no credit and having bad credit are the same thing in the eyes of creditors. Your answer should be the same in either situation; establish a new credit account and use it very carefully, paying your monthly payments in full and on time.
If you have no luck getting a credit card from a retailer, department store, or gas company, talk to your bank (wherever you keep your savings or checking) and ask for a secured card.
In today’s tutorial we will demonstrate how to obtain your free annual credit report from AnnualCreditReport.com, the official site that allows consumers to request a free credit file disclosure, commonly called a credit report, once every 12 months from each of the nationwide consumer credit reporting companies: Equifax, Experian and TransUnion.