Tuesday, January 13, 2009

Day 13 FTJ Bootcamp Activity

Analyze Your Credit Score

More Info from mommysavers:

Now that you have your magic number, what do you do with it? Here’s a general breakdown of how your FICO score is interpreted:

Excellent: Over 750
Very Good: 720 or more
Acceptable: 660 to 720
Uncertain: 620 to 660
Risky: less than 620
Poor: Less than 590
Very Poor: Less than 550

Most Americans have FICO scores in the 600s and 700s. The boundary between a standard loan and a higher cost loan, also known as a subprime loan, is generally considered to be a credit score of 620. Any score less than 500 will generally mean you’re declined for any type of credit. In today's economy, that number may actually be a bit higher in some cases.

Re-Negotiate Rates
If your FICO score is 720 and above, you may be able to re-negotiate your credit card rates. Don’t waste any more money on interest than you have to. Grab your credit card statements and call lenders to re-negotiate lower rates.

Fix Inaccuracies
The FCRA (Fair Credit Reporting Act) protects your right to have inaccuracies in your credit report removed. http://www.ftc.gov/os/statutes/031224fcra.pdf

If you do find something suspicious or inaccurate on your report, notify both the credit bureau who provided the report and also the company where it came from. Include relevant information to support your claims such as cancelled checks and send them via certified mail or another shipping method that requires a signature and delivery confirmation.

Get Your FICO Score Up
Since your FICO score is heavily weighted towards recent activity (the prior 6 months) you can get it up in a relatively short period of time. Focus on the steps outlined here:
• Open a savings account if you don’t have one
• Settle any debts in collection
• Correct inaccuracies
• Keep credit card balances low instead of maxing out your accounts (balances kept over 75% of the limit are considered high)
• Pay more than the minimum balance each month
• Keep accounts open instead of closing them once debt has been paid off
• Avoid checking your FICO score too frequently. Anything more than once or twice a year could raise red flags and impact your score.

Don’t fall victim to scams that promise they will lower your credit score for a fee. Anything that they can do, you can also do on your own – and at no cost to you. Raising your credit simply takes time and effort.

I hope this info helps others as well!

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