Consumer Boomer |
| How to Check Your Credit Score Posted: 27 Jul 2010 04:51 AM PDT  A credit score is an important aspect of a personal financial profile. The score is a reflection of a person's use of credit in the past and is used to determine creditworthiness of an individual by lenders, banks, and credit card companies. It can also be used by insurance companies and even employers to gauge your responsibility.
Credit Score CalculationsEvery individual with a credit history has a right to receive a free annual copy of their credit report from the three credit reporting bureaus: Experian, Equifax, and TransUnion. Each agency will offer a credit score that differs from the other two companies. The score is calculated using percentages of individual factors contained in your credit report such as length of credit history, payment history, types of credit, and amount of credit. These score calculations are known as FICO scores because they were named after the Fair Isaac and Company, the developers of the score calculating software. The FICO score is the most widely used by lenders and consumer scores will increase or decrease depending on the activity on one's credit report. An Extra StepChecking your credit score is a slightly different process than ordering your credit report. In order to get a copy of a consumer's credit score, a fee (generally $15) must be paid in order to have the score included on the report. You can contact any or all of the three credit reports online, by telephone, or via mail to request a copy of your credit score. Consumers are often lead to believe there are ways to get free access to credit scores but nothing is technically free and it usually involves a fee-based membership to get a 'free' copy of a credit score.
Credit Scores MatterThe FICO scores range from 300 to 800. The highest score reflects the better credit history. Interest rates on loans and lending decisions will be based on how high or low a credit score is, as well as other factors. Landlords and potential employers can even use the credit score of an individual to determine their potential as tenants or employees. Insurance companies are another industry that have begun using credit scores to determine risk and set premium rates. Errors included on your credit report can cause your credit score to drop. To be sure the most accurate picture of a financial portfolio is given, a consumer should stay on top of their credit report information to ensure their score is as high as it possibly can be. Consumers should order their credit report and score at least annually, if not more often, to be sure no incidents of fraud, error, or identity theft is negatively impacting a credit score. Consumers can report such incidents to the individual credit bureaus for investigation. Any unverified information can be corrected or removed from the credit report and can positively affect the overall credit score of the consumer. Credit Score ScamsThere is an increase in scams related to credit scores. Many agencies are claiming they can increase a consumer's credit score overnight for a high fee. The reality is a consumer can improve their own credit score by paying bills on time, maintaining a long credit history, and having the right kind of open credit accounts. There is no 'quick-fix' for credit scores. Only time and good credit management can bring a low credit score up. Checking a credit score regularly can help consumers keep up with their own financial picture without the need for a third-party agency's expensive involvement. Where to Get Your Credit ScoreIf you want a more complete look at your credit score, you will have to pay for it. The major credit bureaus offer packages that include credit scores and credit reports from all of the bureaus. This can cost between $40 and $70, depending on which products you purchase. You can, however, usually get just a score from one of the bureaus for between $7.95 and $10.95. You can also go to MyFICO.com and purchase your score. MyFICO offers the score from Fair Isaac Co. Most lenders use a formula based on the FICO score to create their own scores. Other paid services include CreditReport.com or Equifax Score Power. These companies will give you a free trial initially, but then want to sin up to a monthly subscription. You can must get your score and cancel the service. Just don't do it too often. |
| How to Get The Best Deal on Mortgages Posted: 26 Jul 2010 04:25 AM PDT  Shopping for a mortgage is a lengthy process, although some companies will lead consumers to believe that they can provide faster service to get you in your dream home. Unfortunately the housing market experienced a significant period of depression because of so many risky mortgages that were handed out like candy and getting a mortgage today is not as easy as it once was. Mortgage rates have been at all time lows and continue to fluctuate daily. In some cases, I’ve heard of some friends who had locked in a favorable 30 year mortgage rate in January of this year and they are already looking to refinance. Now that is finding a good deal on your mortgage rate! If you’re looking to refinance or just get a mortgage rate for the first time, here’s some to tips to help you out.
Finding a MortgageYou can make use of the Internet to find the best interest rates on mortgages in your area. Starting with your own bank may be your ideal starting place because you already have a relationship with the lender. If not your own bank, a local credit union or smaller community bank may be the best resource because they are looking to bring in quality local customers. Be wary of mortgage lenders who may not be very established, who received bad ratings from the Better Business Bureau, and those who push high-pressured sales tactics to get you to sign for a mortgage. The companies advertising online and through other media resources claiming to make it easy for you to own a home may not be working on the up-and-up. There is no easy way to apply for a mortgage and the process is far from easy. You will end up paying for a mistake for years to come. Getting a Deal on Your MortgageA decision to take out a mortgage loan may be the biggest financial decision in your lifetime, especially if you are a first-time homebuyer. The only tried-and-true way to get a great deal on a mortgage is to keep your own personal finances in check. Here are the primary components of ensuring a good interest rate on a mortgage: Credit Check
If you do not have excellent credit (720 or higher), you may be charged a higher rate of interest should you be approved for a mortgage at all. Mortgage companies are tightening the purse strings since the housing market crash and expect borrowers to be able to prove financial responsibility. The best thing to do is take the time to check on and improve your credit score before even applying for a mortgage loan. Pay your bills on time each month and do not spend more money than you have. Save For Down PaymentA lender wants to see commitment on the part of the borrower. Saving a sizeable down payment to put toward the house is one sign to the lender that you are dedicated and ready to purchase your own home. At least 10% down is required unless you go for a VA, USDA, or FHA mortgage loans which require a smaller percentage down. Ideally, a 20% down payment will decrease your interest rate and make you eligible for the best mortgage deals currently on the market. Don't RushWhile situations may arise when you find yourself desperate to get a mortgage loan, the majority of people who want to be homeowners will know in advance what their housing goals are. If you are in too much of a hurry to buy a home, you will likely make decisions that are not in your best interest. Don't rush through the process. Instead, take the time to speak with the different lenders in your area about what offers they have available. Decide what kind of mortgage makes sense for your situation and finances. The more legwork you do before applying for a mortgage, the more options you'll have to get a mortgage. |
| You are subscribed to email updates from Consumer Boomer To stop receiving these emails, you may unsubscribe now. | Email delivery powered by Google |
| Google Inc., 20 West Kinzie, Chicago IL USA 60610 | |
No comments:
Post a Comment
Thank you for commenting on my blog. I will write back soon!