LETS MAKE THIS RIGHT. TIRED OF GETTING TURNED DOWN FOR CREDIT OR NEEDING A CO-SIGNER.
A credit score is a three digit number calculated from your data-rich credit report and is one factor used by lenders to determine your creditworthiness for a mortgage, loan or credit card. Your score can affect whether or not you are approved as well as what interest rate you are charged. There are many different credit scores and the credit score you view may not be the score used by a particular lender.
Checking your own credit report won’t hurt your scores. Credit inquiries are defined as either hard or soft inquiries. Reviewing your own credit report is considered a soft inquiry, and soft inquiries don’t hurt your scores. Checking your credit report at least once a year allows you to identify any mistakes and helps you manage your personal finances.
Understanding the components that make up credit scores can help you wisely manage your credit decisions. To see how it all breaks down, here's an example of how scores are calculated with a popular algorithm. Your payment history makes up 35% of your score, while the amount you owe lenders represents 30%. The length of your credit history contributes 15%, and the types of credit accounts you maintain comprise 10%. Finally, new credit accounts are responsible for 10%. All of these values are then broken down into a credit score, which ranges between 300 and 850—the higher the number the better.
Your payment history is the most important aspect of your credit score, because it shows how you’ve managed your finances, including any late payments. Your credit history is also very important, as it demonstrates how long you've been managing your accounts, when your last payments were made, and any recent charges.
Typically, the negative information on your credit report tends to fall off after 7 years, or 10 if you’ve been through bankruptcy. Positive information remains on your report for an average of 10 years from the day its corresponding account is closed. This information applies to loans like mortgages and car loans, the types of agreements that have fixed terms on the number of years for repayment. For revolving accounts, such as credit cards, your positive history will stay on your report for as long as the account is active.
No. You do not need a credit card to improve your credit score. There are many alternative options, such as lines of credit, loans, etc. If your credit score is fairly low, you can even start with a secured line of credit, a cash secured savings loan or a secured credit card. Making your payments every month, on time, to a secure loan or line of credit is going to be just as effective as having a credit card and keeping it in good standing.
Maybe; maybe not. Every state has a statute of limitations, which governs how long the creditor or collector has to sue you. If this debt is too old, and they try to sue you to collect, you can raise the statute of limitations as a defense. That means they don’t have much leverage in terms of forcing you to pay. And that gives you more leverage to negotiate a settlement — or just to tell them to leave you alone. For more information, and to fully understand your rights, check with your state attorney general’s office or a local consumer attorney.
Employers sometimes check credit to get insight into a potential hire, including signs of financial distress that might indicate risk of theft or fraud. They don’t get your credit score, but instead see a modified version of your credit report.
Credit scores are calculated using data from your credit files. The information in your credit files may differ across the three credit reporting agencies. Because your scores are calculated using the information in your credit files and your credit files may differ across the three credit reporting agencies, there may be differences between scores. That is why it is important to periodically review your credit reports and scores from all three credit reporting agencies to ensure the accuracy of the credit file data.
Since your credit file changes as credit line balances change, account statuses change, etc., your credit scores may have changed if there has been any key activity on your credit files since the last time you checked your credit reports and scores.
Each state has a law referred to as a “statute of limitations,” which spells out the time period during which creditors or collectors may sue borrowers to collect debts. In most states, they run between 4-6 years after the last payment was made on the debt.
If you owe unsecured debt such as credit card debt, collectors must typically sue you before they can go after your property, including money in your bank accounts, or try to garnish your wages. But threatening to take such actions before they have sued you and won a judgment may be illegal.
If you're sued by a debt collector, you should respond to the lawsuit. You can respond personally or through an attorney, but you must do so by the date specified in the court papers. ... If you don't respond, the court will likely issue a judgment against you as requested in the lawsuit.
