Credit Scores

Goden_Credit_Card.svg.med Most of us are concerned about our credit score. Bad credit can make it difficult or more expense to obtain a loan, and sometimes affect your insurance rates, ability to rent an apartment, or obtain employment.

Credit scores are easy to obtain. Many banks will now provide your score for free, either on their online sites, or with your monthly statements. The numerical scores are usually rated as follows:

Bad             300-549
Poor            550-619
Fair             620-679
Good           680-699
Very Good   700-749
Excellent      750-850

What Is A Credit Score

Your credit score is a number computed by one of 3 agencies. It is based on reports sent to them by your creditors, as well as public records – judgments, liens, and bankruptcy filings.

Bankruptcy does not remove negative items from your credit report. If you failed to pay a debt, had a repossession, etc., these facts will remain. One thing that does change is the current balance due: if the debt has been discharged, the amount currently due will be $0.00! Some debtors will see their credit score increase after their discharge.

Most credit items will come off your credit report after 7 years; the bankruptcy itself will be reported for 10 years after the date it was filed.

What You Can Do To Help Your Credit Score

  • Make all of your payments on time.
  • Don’t Use all of your available credit. Keeping your balance to 20% of less of your credit limit will help.
  • Check your credit reports annually for errors.

What will Hurt Your Credit Score

  • Being Late on a Payment
  • Having too much unsecured debt (credit cards, personal loans, etc.)
  • Making multiple applications for Credit

 

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