credit repair category


Avoid these mistakes and keep your credit score high

September 8, 2016 | Posted by Blair Warner | No Comments

good credit scores
Building a great credit score takes time, but, unfortunately you can destroy your score in what seems like overnight. One simple mistake can cost you up to 90 points. According to FICO, if your credit score drops from 770 to 675, the interest rate you could expect to pay on a mortgage would cost you an extra $24,722 on a 30-year $200,000 mortgage, due to an interest rate increase from of only a 1/2 point (0.50%).

Here are three of the biggest mistakes to avoid if you want to keep your score high— and your interest rates down:

1. Most importantly, make sure you pay every bill on time each month. Missing only one payment can cost you dearly. Missing a payment is defined as being 30-days late, or, said another way, missing a payment and not making it until the next month when you make two at once, called “catching up”. If you have excellent credit and become 30 days or more late on one account, you can expect to lose 90 or more points. For some people, the easiest way to avoid a mistake is to set up auto-pay with all of your creditors.

Most people are not surprised that a late payment can hurt their credit score, but they are often shocked by how many points you can lose for a single late payment.


Follow Upgrade My Credit on Twitter Tweet this: If you become 30 days or more late on ONE account, you can expect to lose up to 90 pts on your credit score.

2. Second, watch those medical bills closely. Unpaid medical bills are often quickly referred to collection agency and become a collection item on your credit report. Although many of these bills end up with agencies because of confusion during the billing process, the collection item reported to the credit bureau looks like a default. Take control, and aggressively follow up with your medical providers and insurance company. It is a good practice that if you think you owe the doctor or hospital money, do not wait for them to initiate calling you.

A collection item like this can take 70 points or more from your score. The balance does not have to be big. Even if the balance is relatively small it has essentially the same effect as a large balance.


Follow Upgrade My Credit on Twitter Tweet this: Unpaid medical bills are often quickly referred to a collection agency and become a collection item on your credit report.

3. Third, pay close attention to your utilization ratio. You may not be familiar with this technical term used throughout the lending and credit industries. To calculate utilization, divide the statement balance on your credit cards by your total available credit. For example, if you have a $1,000 balance on a $10,000 credit card, your utilization is 10%. People with the highest credit scores have a utilization across all of their accounts below 10%. It is recommended to be below 30% utilization ratio at minimum. Higher than that you begin to reap the biggest damage to your credit score. Have you heard of “maxing out your credit cards”? That is basically 100% utilization ratio. If you have only one credit card and use the full limit every month, your 100% utilization ratio could be costing you 90 points.

Pay down your balances and keep old credit cards open to ensure your utilization stays low. It is worth repeating: Keep your revolving (credit card, etc.) utilization ratio lower than 30%, and preferably 10%.


Follow Upgrade My Credit on Twitter Tweet this: Pay close attention to your utilization ratio on your credit report. Go here to learn how to avoid a high ratio.

Hope this has helped. Here are some more articles you might be interested in:

By Blair Warner, Sr. Credit Consultant, Chief Editor

How Do I Get My Free Credit Reports?

October 14, 2015 | Posted by Blair Warner | 1 Comment

How do I get my free credit reports
In today’s information age it is becoming common knowledge that people living in the United States are entitled to a free credit report once a year. This is a right given consumers in the 2002 version of the Fair Credit Reporting Act (FCRA). What is not so clear is the answer to the all-to-common question, “How do I GET my free credit reports?”

This short, but concise article will show you how to get your free credit reports.

How do I get my free credit reports?

As mentioned above, under federal law, the three major credit reporting agencies – Equifax, Experian and TransUnion – are each required to provide consumers with one free copy of their credit report each year. The official website is AnnualCreditReport.com.

you can request your report from each of the big 3 credit reporting agencies, by either ordering and viewing each report online, or requesting that a copy be mailed to you. You’ll have to provide personal information to verify your identity and current residence when you order.

It’s a good idea to print a copy of your report if you find you need to dispute information on your report, or at least save it as a .pdf file for later review.

You may prefer not to order your report online, or have trouble answering the security questions. You can order your reports by phone by calling 1-877-322-8228. You can also request your file by mail, which will require you to print the order form you’ll find online and mail it to each agency with the required identifying information.

Note: Getting your free annual credit report does not hurt your credit rating.

Some experts recommend staggering your requests for your reports so that you get one from each agency every four months. For example, January you order your Transunion report, May your Experian report, and September your Equifax Report. This approach is fine if you are one who stays on top of their debt payments well, with pretty good scores, and you are not planning on applying for any new credit in the near future.

One of the problems with this approach is that these agencies don’t share information with each other, not to mention that not all data furnishers report to all three agencies. This means your reports will more than likely vary significantly, not giving you a complete picture of the credit profile lenders see. Furthermore, if there are errors on your reports, or if you become a victim of identity theft, you won’t discover it for several months.

Finally, please note that the free credit reports at AnnualCreditReport.com do no supply you with your credit scores.

Related Article: 3 Good Reasons To Question What’s On Your Credit Report

Credit Monitoring Services

If you’d like to have regular access to your credit reports as they are updated, you will most likely have to subscribe to a credit monitoring service, for which there will probably be a recurring monthly fee. Be careful. There are some credit monitoring sites not as good as others. Our favorite paid site that we have been using for years in our credit consulting business is Privacyguard.com and instructions for pulling your credit so that we can give you a free credit report evaluation can be found here. You get all three full reports, and all three VantageScore credit scores. Privacyguard.com gives you a 14-day trial for $1, and then only costs $19.95 per month for monitoring. Monthly monitoring is not necessary all the time, but we do recommend it if you are in credit repair and re-building phases, or looking to do something requiring credit in the near future. If you only want your credit reports for one month, you can order them for the $1 and make sure and cancel before your 14-day trial is up by calling the 800-number. (We are NOT affiliated with privacyguard.com)

Has this been helpful? Please feel free to comment or share on social media. We like helping people.

Tweet for creditTweetable Takeaways Include:

  • There is only one place where your credit report is 100% free, with no bait and switch, or small print (Click to tweet)
  • The Fair Credit Reporting Act (FCRA) requires the three major credit bureaus to provide one free credit report per year. (Click to tweet)
  • Most lenders use FICO (credit scores), especially mortgage lenders. (click to tweet)

By Blair Warner -Certified Credit Consultant

3 Simple, Yet Important Credit Tips

April 2, 2015 | Posted by Blair Warner | No Comments

You Need to Know these 3 Tips for Managing or Repairing Your Credit

3 Credit Tipsby Darren Robinson, Guest Contributor

Want to buy a house? Don’t miss these 3 valuable tips anyone can do for building great credit in order to qualify for the best mortgage rates!

When it comes to securing financing for a new house or an existing property, getting a great mortgage rate is at the top of all of our lists. This is probably because even a small difference in your mortgage rate can make a BIG difference to the total interest you’ll pay over the lifetime of your mortgage and overall amortization.

The truth is that getting a great mortgage rate often comes down to having great credit.

But did you know that having no credit can be just as damaging as having bad credit?

Did you know that credit reporting agencies don’t verify the information that is given to them? Or did you know that your credit can affect more than just your ability to qualify for loans? In fact, it can affect many of your everyday purchases, from cell phones to insurance to public utilities!

So if you’re looking for tips to improve or repair your credit, read on for valuable advice and recommendations to manage your credit and improve your financial situation you can start today!

First, always make at least your minimum payment on time on every loan, credit card or other debt you owe.

You may think that you can miss a month and then pay extra the following month—but that’s not how the credit card companies operate (or calculate interest). Instead, your required payment will be considered late or delinquent. Most companies will report even one missed payment to the credit reporting agencies – and this can damage your credit score. So make at least the minimum payment on every loan, no matter what, to keep your credit healthy and in good standing with any debtors you have, as well as have the best chance of a high FICO credit score.

Related Article: How Are FICO Scores Determined

Second, set up pre-authorized payments so your bills are paid automatically.

As I mentioned above, missing even one payment can affect your credit. Debtors don’t care if you intentionally or accidentally forgot to make a payment. They only care if you make your payments on time, every time.

Maybe you simply forgot to pay a bill because all of your bills are due on different days and you don’t have an organized system to keep track of them. In that case, setting up pre-authorized payments can be a lifesaver.

If you prefer not to use preauthorized payments, setting a reminder on your cell phone or computer can be another great way to make sure your bills are always paid on time. Paying your bills becomes effortless so you never miss a due date. You’ll also save money by avoiding unnecessary interest charges.

Lastly, request a copy of your credit report at least once a year and review it thoroughly.

In Canada, you can contact one of two credit bureaus (Equifax or TransUnion) directly to request a free copy of your credit report. In the U.S. you can go to http://annualcreditreport.com to get all 3 credit reports from Equifax, Transunion and Experian.  Verify the accuracy of ALL information, including your personal information, loans, credit cards, etc.

Take note: Credit bureaus don’t verify the information they get from your creditors so it’s up to you to make sure all the information is accurate! Otherwise, you could get a nasty surprise since inaccurate information or information about a loan you don’t recognize could signal that someone may have opened an account in your name, or even possible identify theft.

Address any inaccurate information as soon as possible so that you can be on your way to improving your credit.

For more tips on managing and repairing your credit you are in the right place. Upgrade My Credit is here to help. To get straight forward advice and tips so you can qualify for the best Barrie mortgage rates, visit my website or give me a call.

By Darren Robinson, Mortgage Broker

Darren Robinson is a Barrie mortgage broker, dedicated to offering the best mortgage strategies. He helps people qualify for difficult mortgages and loans. Visit his blog for home buying tips and mortgage renewal tips or call him at 705.737.6161!


Improve Your Credit Scores By Stopping these 5 Things:


1. Waiting for a better time
There is never a good time to start something.. yet it is also true that often there is never a better time than the present. With the myriad of activities vying for our attention and time these days, admittedly, working on improving one’s credit score is not the most exciting option. However, we usually make time for things that are important to us. Is it important to you repair and improve your credit scores, stop waiting for a better time. The time is now!

2. Blaming others and whiningKeep Calm Stop Whining - repair your credit scores
This may sound harsh, and it is not the intent at all, but if you want to improve your credit scores, blaming others and whining about your credit woes is NOT allowed. You can blame your spouse, or ex-spouse, your parents, the government or economy, the list goes on, but it won’t change a thing. No crying over spilt milk. Take responsibility and move on with a plan to change the future. Nuff said.

3. Not planning and setting goals
Failing to plan, is like planning to fail. If we don’t set credit improvement goals, not only can we expect to not get far, but how would we know if we have arrived? We can’t control everything. Life has the tendency to decide some things for us and take us down routes we never thought we would ever consider for ourselves, but don’t let it dictate everything. We have a certain power to influence our future. Having a specific plan for better credit scores, even if not complete, at least sets you in a direction of achievement and is a guide of sorts for a better tomorrow. We often give up and just let events take over, but reacting all the time is not the same as acting of your own free will with a specific plan to improve your credit standing. Take control, set targets and get a strategy, because just living the same way that got you here won’t work. For some tips on how to do that click here.


NOTE: These last two are very important to improving your credit scores.                Without them it won’t happen.

4. Making your payments late
In just about every article one reads about credit repair and credit rebuilding the admonition to make your payments on time as the best way to get good credit scores is abundant. The reason is that 35% of FICO’s credit scoring model is based on payment history. There is no getting around it. The good news, though, is that FICO also weighs most heavily on the most recent 12 months’ history, which means it is never too late to start making your payments on time and turning the corner from back credit to good credit. Start this month never making late payments and watch your credit score rise!

5. Robbing Peter to pay Paul
While writing this post, my daughter asked me to explain what this idiom means, and after explaining she asked me “why Peter, and why Paul?”. I didn’t have an answer for her except that it must mean that it is a very old idiom. This means this concept of taking, or borrowing from one place to pay your debt somewhere else goes back ages. It doesn’t work, though, for it is essentially an endless cycle. You never get out of debt. Rarely does this series of activities bring about a positive benefit. If you find yourself in this never-ending rut, stop it. I know it is easier said than done, but a plan must be put in place to be ruthless with yourself, and find a different way to satisfy your debors. A better solution is the snowball debt reduction method.


Helpful Online Resources for Getting Out of Debt
->> The Snowball Method of Paying Off Debt.
->> Snowball Method Tools, spreadsheets, calculators. – GO HERE….



By Blair Warner

credit report imageThere are a lot of myths surrounding credit scores and how they are calculated, or, put another way, what information is and is not considered in your credit score. Credit scores are based upon information on the credit report. This is the only information used to calculate scores, and predict credit behavior. Since there is often confusion of what is and what is not used in credit score calculations, below should help out a lot.


Which data is and is not included in a credit report?

Personal Information such as name, address, date of birth, Social Security Number and employment data (where you work(ed) only) are included.

Account information. Account information includes loan amount, credit limit, balance, payment dates, payment rating and history, to name a few.

Collections by 3rd party collection agencies.

Public records like judgements, tax liens, bankruptcy, etc. are reported.

Inquiries, when and where, but not for how much, and why you applied for credit. Inquiries initiated by you are called “hard” inquiries, which are results from applying for new credit such as credit cards, vehicle loans, mortgage, etc. Go here for more on inquiries and the myth surrounding their impact on your credit score.

Information NOT included in credit reports:

No salary or income history whatsoever is included

Medical history is not included, although medical collections via a 3rd party collection agency may be.

No arrest or criminal records are reported.

Property tax records are not included.

Insurance premiums or insurance claims are not reported.

Personal information like gender, marital status, race, religion, nationality, political affiliation and personal lifestyle is not a part of your credit reports.

Payday loans (unless in collection), debit cards and prepaid debit cards are excluded

Inquiries initiated by you online, called “soft inquiries” are not reported and have no effect on your credit score.

Financial Institution accounts like checking accounts, savings accounts, CD’s, or investment accounts. NSF checks will appear if sent to collections.

While some of the above information like income and assets may be considered by lenders such as mortgage banks, and auto finance companies, etc., in their decision process, you need only be concerned about the information that is reported on your credit reports as far as your credit score in concerned. Information not reported on your credit reports does NOT impact your credit score.

By Blair Warner (see About US page for more info.)

10 New Year Resolutions For Better Credit

January 5, 2013 | Posted by Blair Warner | 2 Comments

2013 it here! Now what?

Well, it’s that time again—time to start rolling out the New Year’s resolutions. Some of us will vow to eat less, exercise more, live in the moment, be more grateful. You may even decide to bury the hatchet with the family member who makes you so crazy.

This time of year is a great time to start making—and keeping—financial and credit managment resolutions, too. But sadly, like other type goals, we often make them year after year with sincere intent only to see them quickly fall by the wayside, as we revert to bad habits that we have vowed to break.

But what about the most financially successful people and their resolutions? Have you noticed how the most accomplished people just seem to identify important things and consistently get them done? Study successful people long enough and you start to pick up on the resolutions they seem to consistently make.

Here are ten for better credit:

#1 Spend some time making a general plan Successful people plan, period. There is no getting around it. You have probably heard of the old axiom “aim for nothing and you will hit your target 100% of the time”. That holds true for resolutions and making plans to do something different this year that will improve your credit and debt standing. If you don’t know what you want or where you are going, you will not make much progress. Get out paper and pen, a calendar, and be like Nike, just do it, and you will see how it flows. To prime the pump, start with asking yourself some questions, beginning with general, and getting more specific using the 5 W’s, who, what, where, when, why, and lastly, how. Emphasize what and when questions. Go here for more on setting goals.

#2 Determine all possible major expenditures over the next year When scoping out your year to plan and budget think what possible major expenditures may be coming up. Will you need to replace an air conditioner this spring, or a major applicance? Are any kids starting – or graduating from – college, or getting married? Is your car on its last leg? The possibilities are endless and specific to your situation and family. Try to determine the exact month the expenditure will occur. If this is your year to improve your credit, though, don’t purchase anything not necessary. Since these may require the use of credit, also consider how it will effect your credit score and debt load. Call us anytime for a free consultation.

#3 Create a budget As a type of sub-plan under your general plan is a budget, which focuses on your finances. There are two kinds of budgets, one that considers all your current expenses and income over a specific period of time, usually monthly, and one that includes a deliberate, aggressive plan of debt reduction, often called debt snowball-ing. The debt snowball is more than just paying the minimum payment. More on debt reduction below. If you have never made (and tried to keep) a personal/family budget, It’s time. 2013 is the year! A whole blog could be written on how to create a budget, so for now here is a link to an example. The trick is to be realistic and as accurate as possible, and stick to it. Sometimes having an accountability partner helps.

#4 Make a “vow” to make all payments on time. This one should be self-explanatory. It is the cornerstone of good credit. There is no getting around that since 35% of FICO credit score is calculated from your payment history, you have to make yourself the promise to make your payments on time from here on out, and keep it. You will be amazed how much your score will go up if you do nothing else different in 2013 over 2012 except make your payments on time on your current debt each month. Try using your bank’s auto-pay system online. Call your banker to find out how if you are not already set up with online banking.

#5 Create a debt reduction plan As mentioned, this is also called the debt snowball. It is a specific plan of reducing or getting out of debt that requires paying more than the minimum payment each month and the availability of extra cash to do so. The concept is that you start out small, and on specific accounts, that as paid off frees up money you were paying on those accounts to then apply toward remaining, and probably, higher balanced accounts. It may or may not be done in a year, depending on your debt load and it is most importantly applied to unsecured, credit card type debt. A future post will be written explaining it in more detail. Warning: Don’t just jump into to randomly paying off debt. In order to improve your credit standing and increase your score as desired, it needs to be done strategically.

#6 Cut back on expenses One of the best ways to free up some money for debt reduction and financial goal setting is to cut expenses. Even when you think you can’t get blood out of turnip look at your expenses and spending habits and see if you can find something to cut out or down on. Only you know what can be cut out or not, but remember, since 2013 is going to be your year to improve your credit and reduce or get out of debt, be ruthless with yourself. It may take some sacrifice. See Cut Utility Costs – Improve Your Credit for some tips as a place to start.

#7 Check your credit reports and scores As we have mentioned in our article Ten Commandments of a Good Credit Score, it is crucial to know what is on your credit reports and monitor it regularly. If you are looking for a place to pull them, try www.privacyguard.com. it only costs $1 the first 30 days, then if you want to monitor them monthly it is reasonably prices at $14.95/month. We suggest monitoring your credit during times of credit repair and rebuilding, but it is not necessary.

#8 Deal with any derogatory or erroneous items on your credit reports Once you have pulled your credit reports, go over them with a fine toothed comb, checking for any errors, accounts that don’t belong to you, and making a note of all derogatory items. You also need to make sure you have plenty of good credit. Analyzing your credit reports can be confusing, call us, or go here for a free credit report evaluation by a credit professional at Upgrade My Credit.

#9 Refinance your home to 15-year mortgage with a lower interest rate (if applicable) This may not apply to everyone, but sometimes refinancing your home to a lower interest rate will save you significantly each month, freeing up more money for debt reduction and credit building, especially if you can reduce it to a 15-year mortgage. Here is a free mortgage calculator to compare. If you think this may apply to you, or are just want to inquire more about it, we have many mortgage lender partners we can introduce to you. Give us a call. 817-886-0302

#10 Finally, get a free credit consultation from Upgrade My Credit. We love to help people reach their financial goals that require good credit, and we have an even softer spot for folks who have poor credit and just don’t know where to start to repair and re-build it.

This was a bit longer than most of our articles, but hopefully well worth the read. You will probably want to return here through out the year to refresh your determination and keep on track.


By Blair Warner – Sr. Credit Consultant, Upgrade My Credit

Credit Scores Used By Consumers and Lenders Can Differ

October 1, 2012 | Posted by Blair Warner | No Comments

CONSUMER FINANCIAL PROTECTION BUREAU STUDY FINDS CREDIT SCORES USED BY CONSUMERS AND LENDERS CAN DIFFER

One out of Five Consumers Likely to Receive Meaningfully Different Score than Creditor



federal consumer protection bureau logo WASHINGTON, D.C. – Sept. 25, 2012, the Consumer Financial Protection Bureau (CFPB) released a study comparing credit scores sold to creditors and those sold to consumers.

“This study highlights the complexities consumers face in the credit scoring market,” said CFPB Director Richard Cordray. “When consumers buy a credit score, they should be aware that a lender may be using a very different score in making a credit decision.”

The complete Analysis of Differences between Consumer and Creditor-Purchased Credit Scores is available at: http://files.consumerfinance.gov/f/201209_Analysis_Differences_Consumer_Credit.pdf

The Dodd-Frank Wall Street Reform and Consumer Protection Act directed the CFPB to compare credit scores sold to creditors and those sold to consumers by nationwide credit bureaus and to determine whether differences between those scores harm consumers.

THE STUDY DETERMINED:

    1. One out of five consumers would likely receive a meaningfully different score than would a creditor: When consumers purchase their score from a credit bureau. A meaningful difference means that the consumer would be likely to qualify for different credit offers – either better or worse – than they would expect to get based on the score they purchased.
    1. Score discrepancies may generate consumer harm: When discrepancies exist between the scores consumers purchase and the scores used for decision-making by lenders in the marketplace, consumers may take action that does not benefit them. For example, consumers who have reviewed their own score may expect a certain price from a lender, may waste time and effort applying for loans they are not qualified for, or may accept offers that are worse than they could get.
    1. Consumers unlikely to know about score discrepancies: There is no way for consumers to know how the score they receive will compare to the score a creditor uses in making a lending decision. As such, consumers cannot exclusively rely on the credit score they receive to understand how lenders will view their creditworthiness.

  • RECOMMENDATIONS:

    1. Shop around for credit. Consumers benefit by shopping for credit. Regardless of the scores different lenders use, they may offer different loan terms because they operate different risk models or face different competitive pressures. While some consumers are reluctant to shop for credit out of fear that they will harm their credit score, that actual negative impact is exaggerated. Inquiries generally do not result in a large reduction in a consumer credit score.
  • VERY IMPORTANT – Check the credit report for accuracy and dispute errors. Credit scores are calculated based on information in a consumer’s credit file. Inaccurate information may be the difference between a consumer being approved or denied a loan. Before shopping for major credit items, the Bureau recommends that consumers review their credit files for inaccuracies

    Thanks to contributions from the California Association of Mortgage Professionals

    By Blair Warner

    Cut Utility Costs – Improve Your Credit

    August 2, 2012 | Posted by Blair Warner | 2 Comments

    Cutting costs to get out of debt

    Click for a free credit evaluation

    I admit, the title was designed to get you to read this posts. However, it’s true; when trying to get out of debt and improve your credit profile, it is often important to look at your finances and expenses and come up with ways to save money so that you can pay down any debt you may need to in order to increase your score and reach your financial goals. One of the biggest expenses we have, besides food and shelter, are utility bills like electricity, water, telephone, etc. Today’s blog looks at some tips for saving money on your electric bill, the biggest portion of your utility bills.

    First, Reevaluate your monthly electric bills. Read through your bills and understand what all the charges are for. Start by determining how much electricity you use. Understand what each itemized fee is, and even look at the kilowatt usage. Compare each month and season’s usage, and use the monthly usage from the previous 12 months to determine the approximate value. (Follow the same process for your water bill, telephone bill and internet bill. Some people have an HOA bill as well.)

    Consider the amount of energy you use at night. Many people burn a great deal of energy at night, leaving lights on and appliances running while they sleep. Make sure your T.V., computers, and any unused ceiling fans are turned off, as well as unplug gadgets such as cellphone and radio devices, as they can suck energy. (It’s not good for your device batteries anyway, to keep charging after a full charge).

    Change your lighting. If you use a particular light more than 30 minutes a day it is economically worth it to replace the bulb with a high-quality LED or compact flourescent bulb to save money.

    Pay attention to heating and air-conditioning. The heating and air-conditioning systems probably account for the largest portion of your monthly electric bill. There are several good tips you can follow to save electrical use for these items.

  • Make sure and change your filters regularly. Don’t use the so-called permanent filters. They can cause your system to not function at full capacity, and put strain on the unit, even requiring a sooner-than-normal replacement.
  • Is your house properly insulated? A well-insulated home will not leak heat or cool-air.
  • Use a fan instead of an air-conditioner when you can. It is far less costly. Also, turning your thermostat up a little, to even 77 or 78 degrees and using a fan will do wonders in cutting costs.


  • Decrease energy use by your refrigerator and freezer. They use a great deal of energy. Of course, you can’t very well turn off the refrigerator. There are a few things you can do. Make sure the door is closed when not in use, and check all the sealing gaskets around the doors to make sure they seal well. Lastly, make sure there is plenty of ventilation by leaving plenty of space between the refrigerator and the wall.

    Use the oven and stove in ways that uses less energy. When using the stove, use the right pots for the right burner size. Turn the stove off five minutes before the cooking time ends. Keep the oven door closed as much as possible and try not to preheat it if possible. Finally, turn off the oven 10 minutes before the food is ready.

    Use energy-efficient appliances. Technology has come a long way in developing energy-efficient appliances, especially for the most often used ones.

    As a last tip, make sure the washing machine and dish washer are as full as possible before each use so as to reduce the number of times they are used. Furthermore, in most cases, it is ok to use cold water which will reduce energy use more than you would think.

    As David Horowitz says “Being energy-efficient is not only good for the environment, but is one of the most important ways in which you can cut costs.”

    I know this is not your typical blog topic you see on a credit repair and credit counseling website, but I hope you received some great ideas on how to save money.

    By Blair Warner

    The 10 Commandments of a Good Credit Score

    June 3, 2012 | Posted by Blair Warner | 5 Comments

    A common question I get asked is, “what is the secret to a good credit score?” I always hate to answer it so matter-of-factly and quickly because I know they are hoping I can perform magic. The simple answer is, though, the only way to get one is to demonstrate financial responsibility. “Creditors don’t care about how many millions you may have in your investment account, it’s how you use your credit,” says Maxine Sweet, vice president, public education for Experian.

    However, there are some tips for using your credit, and like many things in life, it’s what you don’t do that can have a positive effect on your credit score.


    Steer Clear of These 10 Things:

    1. Thou Shalt Not Avoid Using Credit. If you don’t use credit, you won’t have much of a credit score. To Quote Sweet again, “A credit score is an important tool companies use to protect themselves”. The lower the score, the higher the risk, and this can affect whether or not a loan is approved.

    2. Thou Shalt Not Miss Payments. Paying a bill late will hurt your credit, but missing a payment will damage it even more. “If you do so, you can’t make it up,” Sweet says. In other words, making two payments in the next billing cycle will not remove the blemish from your credit history. Whether or not you pay your bills on time determines 33% of your score.

    3. Thou Shalt Not Limit Loan Types. Despite what your bank account may think, a car payment and a mortgage may not be enough. Also managing an installment debt, such as a credit card, is a good indicator of credit savviness. There are five elements to the credit score model and revolving credit, which allows consumers to charge and owe different amounts each month, is one of them. “It’s 10% of the score,” says Gail Cunningham, vice president of public relations for National Foundation for Credit Counseling.

    4. Thou Shalt Not Close Unused Credit Card Accounts. Actually, just use caution, says Sweet. A factor in credit score models is your utilization, which is your debt vs. how much is available. For instance, if you owe $4,800 on a card with a $5,000 limit, you’re using most of your available credit and this “utilization” will have a negative impact on your score. Counting toward 30 percent, your utilization is the second highest factor in your credit score. You should charge no more than 30% of your available credit, recommends Cunningham.

    5. Thou Shalt Not Be A Credit Tease. Don’t run up charges all over town or apply for several cards at once while looking for the best rewards program. Recent inquiries means that you have accessed your credit and this can affect your score negatively. “This signals that you’re desperate for credit and don’t have enough cash available for your purchases,” says Cunningham. She adds that if you are shopping for a major purchase, such as a mortgage or car loan, the inquiries will usually roll together into one.

    6. Thou Shalt Not Rob Peter To Pay Paul. Don’t charge anything unless you know how and when you are going to pay it back. One of the benefits of credit is the ability to spread out payments on a big purchase, not to delay paying with hopes that the money will come in – from somewhere. If you need to use a credit card for convenience, use a prepaid card or a secured card that enables you to make payments to your own line of credit.

    7. Thou Shalt Not Get On The Call List. When a debt turns into a collection account, it’s an indication that you got yourself in hot water. Once a collection agency jumps into the arena, it becomes the owner of the debt, which will show on your credit history. Trying to make payments to the original debtor will not make the collection agency or the negative mark on your credit go away.

    8. Thou Shalt Not Forget The Little Things. That library fine you didn’t pay or the health club contract you signed but didn’t honor can show up on your credit report. Any debtor has the right to report unpaid bills to the credit bureaus, and many of them exercise that right.

    9. Thou Shalt Not Negotiate. On paying less than what you owe, that is. If you cannot repay a debt in full and a creditor agrees to settle for less than you owe, you haven’t won the battle. The transaction will be reported as a settled account and this will hurt your credit score. Instead of negotiating to lower the overall amount of the debt, ask to have your interest rate or monthly payment lowered so that you can continue to pay the debt off in full. (Sometimes negotiating is the best choice. Each case is different)

    10. Thou Shalt Not Give Up. If you have late payments, missed payments, defaulted loans, and similar credit mess-ups in-between, don’t give up and think that your credit history is ruined. Although offenses like these generally stay on your credit history for seven years, the recovery clock doesn’t start ticking until you have one full month of paying all of your debts on time, says Sweet.

    Adapted from FreeCreditReport.com, a part of Experian. (excluding introductory paragraph)

    Posted by Blair Warner

    How Are FICO Scores Determined?

    March 28, 2012 | Posted by Blair Warner | 2 Comments

    There are five factors that contribute to determining your credit score:

      Payment History
      Amount Owed (ratio)
      Length of Credit History
      Taking on More Debt (Inquiries)
      Types of Credit in Use

    1. How you pay your bills – Your credit history (35 percent of the score)
    This is the most important factor; how you’ve paid your bills in the past, with the strongest emphasis on recent activity (2 years or less.) Paying all your bills on time is good. Paying them late is not, and particularly on a consistent basis. Few things hurt your score as heavily as past due payments. Having accounts that were sent to collections is even worse. Declaring bankruptcy is the worst. Think long and hard before filing for bankruptcy. It most cases, it simply isn’t worth it.

    2. Your debt to your available credit ratio (30 percent)
    The second most important area is your outstanding debt — how much money you owe on unsecured and secured loans, with emphasis on revolving credit. Revolving credit is credit cards, and lines of credit. Installment loans include car loans, personal loans, mortgages, etc.). The ratio of available credit to debt (account balance) is an important ratio. Try to keep the ratio of available credit to credit used, also called utilization ratio, below 30%.

    Some underwriters place importance on the total amount of credit you have available. If you have 10 credit cards that each have $5,000 credit limits, that’s $50,000 of available credit. Statistically, people who have a lot of credit available tend to use it, which makes them a less attractive credit risk. However, please note, this is less important to FICO’s credit score algorithm.

    3. Length of credit history (15 percent)
    The third consideration is the length of your credit history. The longer you’ve had credit — particularly if it’s with the same credit issuers — the more points you’ll get.

    4. Types/Mix of credit (10 percent)
    The best scores will have a mix of both revolving credit, such as credit cards, and installment credit, such as mortgages and car loans. “Statistically, consumers with a richer variety of experiences are better credit risks,” Watts says. “They know how to handle money.”

    5. New credit applications – Also called inquiries (10 percent)
    The final category is how many credit applications you’re filling out, called intquiries. The scoring model compensates for people who are rate shopping for the best mortgage or car loan rates, but not for revolving type loans, payday loans, etc. The only time shopping really hurts your score is when you have previous recent credit stumbles, such as late payments or bills sent to collections.




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    By Blair Warner
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