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How To Improve Credit Score

Some tips on credit card consolidation are common sense. One tip that should go without saying is not making a new agreement that you can’t pay. Likewise, it is no good to consolidate your credit cards for a lower monthly payment if it is still too high.

Here are some other important tips on credit card consolidation to help you make your decisions.

  • TIP 1: Ensure the debt consolidation company or credit counseling company you’re working with is reputable. These companies are a dime a dozen all over the Internet. You can also find dozens of different such companies advertised on television and radio.

Just because you see the ad on a popular and reputable website, or see the ad on the television, doesn’t mean the company is a good one! Even rip-off companies need to advertise to draw in customers. Try to talk to someone who has used the company. Investigate them online and with the Better Business Bureau.

Even if the company is a good one, you shouldn’t just take what they’re saying as gospel. Instead, crunch the numbers and figure out just how much you’re saving. Sometimes what you find can be surprising.

You may be about to sign an agreement that eases your burden today but increases it tomorrow! If you’re getting a lower monthly payment, make sure that your interest rate is lower also. Otherwise, your debt will accumulate at the same rate as before while you’re paying less.

This might seem like an acceptable solution if your payments are out of control. But it will keep you in debt longer and making payments longer. So if you’re having trouble with your debt now, think about how you’ll be adding to it in the future. How likely is it that making bigger payments in the future to pay off more debt won’t be a problem?

Most good companies avoid this situation, but you should always make sure you’re not getting in deeper just in care.

  • TIP 3: This is one of the tips on credit card consolidation for the do-it-yourselfer. You didn’t contact a service but instead decided to consolidate your cards yourself. Read the new card agreement carefully. If you think you might be forced to make a late payment even once, reconsider.

Doing so can send your interest rate skyrocketing, and you could end up in deeper debt than before.

  • TIP 4: Once you’ve consolidated your credit cards, stop using the ones that have a zero balance. Use cash only and do your very best not to add any new credit debt. If you don’t do this, you’ll end up with the consolidation to pay plus new debts on other cards.
    Stop using credit cards is one of the best tips on credit card consolidation you can get.

Average American Credit Score Is It Good Enough

What is your credit score based on, and what is the average American credit score nowadays? How do you fare in comparison with your fellow Americans? Is your rating higher or lower than the average American credit score? Of course, just about everyone knows that there is such a thing as a credit score and based on your past credit performance.

Still, not many people really know the ins and outs of credit scoring.

First of all, the highest credit score is 850; conversely, the lowest is 300. Of course, the majority of people fall between those two extremes. In fact, the average American credit score is now about 690. Still, with the downturn in the economy and unemployment on the rise, individual credit scores will likely begin to fall, and that means the average credit score will begin to fall right along with them.

Even though the average American credit score seems pretty high, at 690, that is really not “good enough” to get the best credit terms from most lenders. Most banks and other lenders use the credit history and credit score to determine whether they will lend you money, whether they will require collateral from you, how much interest they will charge you, and how long they will give you to pay back your loan. So, obviously, the better your rating, the better deal you will get at the bank.

Although there are no hard and fast rules that are uniform across the banking industry, most lenders reserve the best rates for people with a score of 720 or better. That means that if you are just average (690, remember?), you are not likely to qualify for the best interest rates and terms.

But, of course, the policies of the different institutions vary. Right now, a lot of bankers are turning down requests for loans for anyone who is well below the average American credit score, and traditionally, even in the best economy, a score less than about 620 would get you the absolute worst deal.

Some economists predict that in a few years, however, the lenders will be unable to be particular about whom they offer loans to and will have to be a bit more flexible about terms; the notion revolves around the fact that banks make money by lending it out.

That is a fact; that is why they do it; they don’t lend you money just to make you happy. That being the case, they must lend. If the average American credit score drops significantly, banks will have fewer options. But that time will not come very soon or in the immediate future; right now, everyone expects banks to err on the side of caution, and that is just what they are doing.

When the economy is tough, the banking industry gets more conservative in its policies; if you are in the market for a big-ticket item such as a house or a car now (or will be soon), you should make every effort to keep your credit history on the up and up so you can stand out as better than average and can get yourself the best deal possible when you need to borrow money.

Average Credit Scores And Where Do You Fit

What are the average credit scores in the United States? Even though we are a year or more into a recession, the average credit score has not fallen all that much; it remains at around 690, which is within a few points of where average credit scores were a couple of years ago.

This says a lot for the spirit of the American people; despite the downtown economy, most people still work hard to pay their bills, and really, in this economy, it is more important than ever to keep your credit score right at par with average credit scores around the nation, and within your own home state.

Most economists predict, and it would seem reasonable, that the average credit score will begin falling sometime soon. As unemployment rates increase and underemployment becomes more prevalent. As the downward trend in investments continues, average credit scores are likely to drop, simply because people who would otherwise be very focused on paying their bills in a timely fashion may simply not do so.

If you can, though, work hard to protect your credit rating; banks and other lenders are becoming pickier and pickier about whom they will allow borrowing money, and the terms for less-than-perfect credit are getting more stringent.

For example, six years ago, I got divorced and bought a house. My credit score was slightly below the average credit score of about 685. I qualified, however, for grand terms because low-interest rates were awarded to people with a rating of 680 or better.

Six years later, with all personal circumstances being the same, I would not qualify for that 5% mortgage, as most lenders in my area require a score of 750 or more to get the best rates. That is a jump of seventy points, so as you can see, it is even more important that you keep your credit history clean, make sure your report is accurate, and work to keep your score as high as you can.

So, where do you stand? The average credit scores are highest in Vermont, Minnesota, Massachusetts, South Dakota, North Dakota, Iowa, New Hampshire, and Montana. The average credit score in all of these states is 700 or higher.

The average credit scores are lowest in Texas, Louisiana, West Virginia, Michigan, Georgia, North Carolina, New Mexico, Nevada, Arizona, Alaska, and Alabama. All of these states have average credit scores in the 660’s and 670’s.

Beacon Credit Score Keeping Track Of It

In these times of a tough economy, it is more important than ever to keep a handle on your credit rating. If your score is less than you think it should be or would like it to be, now is the time to do something about it. Suppose you have ever tried to correct or improve your credit score on your own.

However, in that case, you know how difficult, time-consuming, and frustrating the process can be. You also probably realize that there are three different major credit-reporting agencies – TransUnion, Equifax, and Experian – and they usually have different scores for the same person; they often have conflicting information as well.

Banks and other lenders are getting more stringent in their lending requirements, so it just makes sense to get and keep the best score you can. The credit score we are all so familiar with is known as the FICO credit score. Still, Equifax, one of the three major agencies, refers to the FICO as the Beacon score.

TransUnion calls it the Empirica score, and Experian refers to it as the Experian/Fair, Isaac Risk Model. Even though there are different names, beacon credit score, empirical credit score, and Experian credit score, they are basically the same. This numerical ranking identifies your creditworthiness.

The different reporting agencies are likely to have slightly different scores for the same person, however. The reasons for this are twofold: First, not all lenders and financial institutions report to each credit bureau; therefore, the different companies may not all have the same information. Second, each agency may have a slightly different way of calculating the score.

These minor differences don’t usually make that much of a difference. They are not usually a concern because banks realize the scores will be different, so they just use an average of the three scores. However, the difference in scores might be very different if one of the agencies does not have information that is quite important, such as accurate mortgage information.

How do you find out what your credit score is? You can go to the Equifax website to get your report and beacon credit score and visit the websites of the other two agencies to get your report there, too. You are also entitled by law to get one free credit report from each bureau once a year. The website for that is www.annualcreditreport.com.

Using this free resource is always a good idea, as it is good to know what information is contained in your history. However, the most important reason for keeping up with your credit report is to be sure you fix errors that may negatively impact your rating. Often, one agency will have the correct information while another will not.

Do not sit around and let others control your destiny. Instead, find out what your beacon credit score is, make sure your credit report is accurate, and consider making efforts to improve your beacon credit score if you want to get the best deals on interest rates and other terms the next time you need to buy a new car or decide to own a home.

Calculate Credit Score How Do They Do It

Just about everyone who has been an adult for any amount of time knows the importance of establishing and maintaining a good credit score. It is your credit score, as determined by the three credit reporting bureaus, that determines your creditworthiness.

But, unfortunately, lenders of all sorts, and even landlords and insurance agents, are likely to pull your credit history practically before they shake your hand and say, “Nice to meet you.”

Do you know your credit score? Do you wonder how TransUnion, Experian, and Equifax calculate credit scores?

Credit scores are calculated by looking at your income, expenses, the amount of credit you already have, and how well you have paid your bills in the past. By looking at these unique items, the credit agencies apply a mathematical formula, calculate your credit score, and report their findings and determinations to those who inquire about your creditworthiness.

Information that may have a negative impact when your credit score is calculated to include:

• A large amount of outstanding debt.
• A low income-to-debt ratio.
• A bankruptcy.
• Late payments
• No credit history
• A limited credit history
• Unpaid utility bills
• A lot of open credit accounts, even if they have low or no balances
• A lot of accounts being opened at the same time.
• Closing accounts that still have a balance.
• Closing a lot of accounts at the same time.

Suppose you are attempting to calculate your own credit score. In that case, you may find it difficult to do so, as several variables are involved. Still, suppose you follow the simple strategies below. In that case, when your credit score is calculated, you are likely to have a pretty good score:

• Apply for only one type of credit at a time and wait for a few months before applying again.
• Pay your utility bills (electricity, cable, water, phone) on time each month.
• Live within your means.
• Make all credit card or other credit payments on time.
• Pay more than the minimum due on your credit cards.
• Use credit cards to buy necessities such as groceries, but only if you have the willpower to put the same amount of money away and pay for them in their entirety when the bill comes in.
• Maintain a savings account for emergencies.
• Save up for the purchase of expensive items rather than charging them all the time.
• Check your credit history periodically to make sure it is accurate.
• Correct errors on your report promptly.

Can A Credit Card Company Sue You Yes

Can a credit card company sue you? They can, and they will. While it might seem unfair that you owe a few thousand dollars and are being sued when these companies obviously have billions, that’s simply the law.

You signed a contract when you started using the card. So if you wonder, can a credit card company sue you, you need to know that they can and they will if you don’t pay.

Credit card companies make their money by keeping people paying for years. Then, they make their money on the interest that you pay on the debt. In fact, they make several times what they originally “loaned” you by allowing you to make purchases on credit. Can a credit card company sue you?

Why wouldn’t they? If you’ve stopped paying, you’ve stopped their income stream. It doesn’t matter if you were “loaned” $500 and paid back $3000 in interest over the years on that same $500. You still owe them, and they can and will sue because you broke the credit card agreement.

Some people don’t realize that it’s not something to be trifled with when you sign a credit card agreement. It’s a legal and binding contract. Break it, and you can be sued, no matter what.

If you owe a credit card company a lot of money and fear being sued, you can contact them and try to arrange payments that will satisfy them. If you’re on the verge of being sued, they’ve probably already sent the debt to a collection agency.

Contact them, in writing, with a proposal about payment arrangements. If they have already made you an offer about paying less than you owe, as many will do, that’s your best bet to get out from under the debt before you’re sued.

Some agencies will offer to let you pay from 50% to %75 in one lump sum to erase the debt. Some go even lower and let you make a few payments to do so the same thing.

Some collection agencies make such an offer about the second time you hear from them. The first time is just presenting you with the debt, telling you to pay it, and mentioning that they’ll assume the debt is yours if you don’t dispute it within 30 days.

The next contact might not be anything but another demand for full payment. After that, though, most will start making offers. But, of course, some make better offers as time goes by, and some don’t.

Keep in mind, the longer you wait, the larger your debt becomes. This is because interest accumulates even if you haven’t used or paid on that card in years.

Many of these companies will make better offers after a long time goes by. If you get a good offer, like paying about $1500 on a debt that’s almost $3000, you should find a way to pay that. Because not only can a credit card company sue you, but when they do, you’ll have to pay the whole amount plus more interest and court fees.

Can A Credit Card Garnish My Wages

If you’re asking yourself, can a credit card garnish my wages, then you must have a past due balance you’re unable to pay? This is a scary situation to be in. But whether you owe $1000 or thousands more, the answer to “can a credit card garnish my wages?” is that they can’t, but a judge can.

They can’t garnish your wages automatically just because you owe them money. They have to sue you for the amount due first. However, if the judgment is against you, and if you owe them money, then a judge could order your wages to be garnished.

This isn’t something that a judge will do just for fun, however. In almost all cases, you will be allowed to make payments on your own. The lawyer for the collection agency that handles the debt will probably talk to you for a few minutes in the courtroom. Then, he’ll try to get you to commit to a certain payment arrangement.

Then when you appear before the judge, they will simply tell the judge the agreement you made. Then he’ll order it in judgment against you. If you’re uncooperative, the judge may order a wage garnishment. Still, it’s most likely you’ll be able to work something out with the lawyer.

If you have been sued and a judgment was ordered against you, you must make the payments on time. Because it’s a court order, not paying the payments could bring you back in front of the judge for penalties. You would be asked why you didn’t pay and why you didn’t attempt to pay even part of the amount.

If the judge chooses to do so, he or she can order your wages garnished for the amount of the payments. Then the credit card company will receive their money automatically out of your paycheck.

Can a credit card garnish my wages? They’re more than happy to do so if the judge orders it because they know the check won’t bounce, and there’s no way they won’t get it if it comes automatically from your employer.

This is a terrible situation to be in, but if it happens, you’ll have to make the most of it. You can get a lawyer when you’re being sued to help negotiate with the debt collection lawyer to work out the best terms of your repayment.

This can help you find a situation that will allow you to make payments on time and pay down the ordered debt without having your wages garnished.

The best thing to do is make an arrangement with the collection agency handling the credit card debt before they file suit against you. You can often get a deal in which you pay a portion of the debt, and they’ll close the case.

If they sue, you’ll end up paying more than you owe in interest and legal fees. So the answer to “can a credit card garnish my wages?” is no, but a judge can and will do it on their behalf.

Credit Card JudgementsCan It Happens To You

Credit card judgments are judgments against you for unpaid credit card debt. For example, when you’re sued, you appear in court along with the collection agency that’s handling the debt for the credit card. If you owe them money, credit card judgments will be found against you before you leave the courtroom.

What does this mean? Credit card judgments simply mean that the judge found you to owe them money and is now ordering you to pay what you owe. You may not be required to pay it all at once. In fact, you will almost always be given the option to make payments.

Then when the judgment is found against you, it requires you to make those payments in a certain way. You’ll have to make them on time each month or risk being called back before the judge.

How can you avoid credit card judgments? The most obvious way is to avoid being sued. If you can find a way to pay your credit cards off, you should do it. Almost any type of debt is preferable to credit card debt because of the compounding interest rate on most cards.

You should think twice before taking any kind of loan to pay off credit card debt, though. For example, if you get a loan that uses your home for collateral, defaulting will cost you your house. It’s much better to avoid that scary situation and find other ways to pay the debt.

If you have to take extra work, work more hours or take a second job to pay down debt, you should do it. That might sound extreme, and you wonder when you’ll sleep. But consider the sacrifice you make a good one.

If you can get your debt down to a reasonable level or pay it off entirely, then you won’t have to work like a dog forever. It’s a short-term, temporary fix that can keep you from being sued and having credit card judgments found against you in court.

If you appear in court and can’t make the payments even after that, you can have your wages garnished. In addition, you can have a lien put against your home. However, it’s unlikely that your home would be seized and sold to pay a credit card debt unless the debt is huge enough to warrant something that extreme.

But if you went to sell your home, the amount of the lien would come off the top and go directly to the credit card company. This can prevent you from being able to afford the home you want and affect everything involved in the sale.

If you owe a credit card company, they will get their money from you eventually, one way or another. Filing bankruptcy is the only way to get rid of the debt without paying it. And you may not even be able to file bankruptcy.

It’s best to avoid bankruptcy anyway and instead find ways to pay the money you owe to prevent credit card judgments against you.

Credit Card Laws What You Need To Know

Credit card laws are the laws that govern the way credit card companies must operate. Yet, you don’t usually hear much about them. That’s because most of them are just basic laws that keep anyone from doing illegal things. But credit card laws are under review and changing as we speak.

Consumers and lawmakers are trying to put credit card laws into effect to stop credit card companies from changing their terms at will. You might not realize it, but your credit card rate of interest can be adjusted. You don’t even have to be late on a payment.

How can they do this? Isn’t there a law preventing it? No, there isn’t. And that’s one of the problems.

If you owe money to Joe and Bob, and you’ve always paid Joe on time, but you’re late with Bob’s payment this month, should Joe charge you more? Of course not. And if Joe and Bob were your friends, Joe raising your payment or your interest over a late payment to someone else would probably cause some problems.

But that’s exactly what credit card companies are doing. As a result, you can be the best credit card user in the world. You’ve never even made a late payment, and you often pay more than the minimum payment. Make a late mortgage payment or a late payment on another card, though, and see what happens.

Some of the credit card companies stopped this practice after consumers complained. Others hold to it. They can raise your rates and slash your credit line based on that late payment to someone else, calling you a credit risk. In fact, if they review your credit report, they can decide to do both those things just based on how much credit you have and how much you’re using.

Credit card laws don’t stop them from raising your rate if they only think you look like you might get into debt trouble eventually. Which is basically a free pass that lets them raise rates and slash credit lines anytime they want. That’s not fair.

They also regularly deal underhandedly with consumers by charging variable rates on using credit cards. That isn’t dirty dealings. But the way they handle your payments regarding those rates is.

Say you’re getting a low rate on that balance transfer. Many cards will do that, but you’re paying prime interest on purchases. You know that, so you’re not bothered. When you make your payment through, where do you think they apply for that payment? They lower the amount that you’re already not being charged interest on.

The amount of money sitting there charging you 18% interest doesn’t change. They automatically apply all payments to the amounts with the lowest interest rates to keep you in debt longer and paying more interest.

Many people do not know that their payments are applied that way. Credit card laws being today will also remove the company’s rights to rewrite their contracts with you anytime they want.

Credit Score Breakdown Is No Big Mystery

Do you feel as if your credit score rating is some big mysterious secret? Millions of folks do indeed feel that way, and really, the credit bureaus do not readily give out the exact way that they compute your credit score, but you need not fret.

It definitely makes sense to have a pretty good understanding of how your credit score is calculated so you can take the measures to establish and maintain a “good” score.

If you have absolutely no idea how your rating is determined, how can you possibly know what to do and what not to do? If you were taking a class in earth sciences, you would not be expected to take a psychology test, right? Of course not; you can only expect to know what you have learned; the same is true of your credit report. Know what information is used to determine your score if you will gain control of your credit history and make the changes.

So, here is a pretty good credit score breakdown you can use to make your financial decisions:

• Mixture of credit. Having various loans and paying them back as agreed counts for ten percent of your credit score. For example, suppose you have different types of debt, such as a mortgage, a car note, and credit cards, and you pay them all well. In that case, that indicates your ability to handle different kinds of loans well.

• New credit inquiries count for ten percent of your score also. So the more people (organizations) that go looking into your credit history, the more your credit score will be negatively affected. The exception is you looking into your own report. That has no impact on your score.

• The length of your credit history counts for fifteen percent of your score. So the longer you have had credit, the better. But, of course, having credit for a long time and not paying responsibly is no help at all.

• How much you already owe counts for thirty percent of your rating. This is called the debt-to-income ratio, and the number should be low. Keeping the total amount of money you owe at or below twenty-five percent of your income will generally get you big cheers from any lender.

• Your payment history is the most important factor in determining your credit score. It counts for a whopping thirty-five percent of your rating. That is both good and bad. For example, suppose you have always been very careful about making your payments on time, even if you have had a pretty high debt-to-income number. In that case, you may be seen as a decent credit risk. However, if you have even one late payment, your report may be lowered significantly.

There is no more mystery; if you want to establish a positive credit score, pay the most attention to keeping the amount of debt you hold less than about thirty percent of your income. Also, pay your bills on time.

Finally, don’t apply for credit unless you really are serious about wanting or needing that particular credit so that you don’t have too many inquiries into your file, and if you only have one kinda credit, say a car loan consider getting a credit card with a tiny maximum and pay it regularly and consistently for a long time.

Credit Score Calculator And How It Can Help You

Do you remember going to school when all you had to figure your math problems with was a pencil and a slide rule? Maybe you are younger than that. Perhaps you remember having a calculator that was as big as your textbook and only being allowed to use it for homework and never on tests?

If you are still younger, you may remember being thrilled to discover that when you took harder math classes in school like Calculus, for example, your teacher actually expected you to have and use a calculator every day.

Now we have calculators that graph and make charts and require a huge manual to understand, but that is not the only kind of calculator anymore. Nowadays, we have a calculator for everything. You can find love life calculators, calculators that predict how likely someone is to be successful in a certain career, and even calculators that determine the precise amount of water to give your houseplants.

Even with all these different types of calculators, the one that is likely to have the biggest impact on your life is the credit score calculator. So what exactly is a credit score calculator? Well, a credit score calculator is a graph or computer program that can determine your creditworthiness by combining a bunch of different data about you and your finances into a formula and spitting out a number that represents you as a credit consumer.

The credit score calculator is what determines your FICO credit score. The credit score is what lenders use to decide whether or not they want to lend you money to buy a house, car, boat, or big screen TV. So, it is important to know what your credit score might be, and using an online version of a credit score calculator is one way to get a pretty good idea of what it may be.

What kinds of questions will a credit score calculator ask you? You will answer questions related to the main criteria for determining your credit score – the length of time you have had credit, how much debt you have, how often you have been late with payments (if at all), and the like. Some common questions are:

• How many credit cards do you have?
• How many different types of credit do you have?
• How many debts are currently thirty days late?
• Have you ever had a bankruptcy?
• What is the total amount of money you owe?
• What is your gross salary?
• Have you ever had a tax lien or judgment against you?
• How many cards do you have that are “maxed out?”

If you want to get a pretty good idea of what your credit score might be before you apply for a mortgage or car loan, using a credit score calculator might give you a pretty good idea.

Credit Score Meaning And Impact On You

What is a credit score meaning, who determines it, what kinds of things affect your rating, and what meaning does your credit score have in the way you can conduct your life daily? These are all good questions, especially in uncertain economic times.

So it makes good sense to keep an eye on your credit history data. You never know when you might need to borrow for an emergency or when that dream house right around the corner from the best schools in the city will go up for sale, so creating and maintaining a healthy credit score is important.

So what exactly is the meaning of a credit score? In what way does it help you? In what ways can it make your life more difficult? A credit score is a number assigned to you and every individual in the United States representing you like credit risk or not a credit risk.

The higher your credit score, the better your life can be when it comes to buying power. This is because the higher your rating, the less you will have to pay in interest; conversely, the lower your score, the more you will have to pay. So having a high credit rating can save you a bunch of money in interest payments.

In addition to the terms and interest rates, your credit score may determine whether or not you can even get a loan. Even more recently, landlords, insurance agencies, utility companies, and others have started using your credit score to make decisions that affect your financial life.

And even if you are trying to get a better job to increase your income and improve your credit score, your credit score meaning becomes even more important. This is because many employers now check your credit history before they will hire you.

What kinds of things determine your credit score? How you have managed your credit in the past is the most important factor. If you have had late payments reported to the credit bureaus, that will negatively impact your score. Of course, a bankruptcy will practically destroy your credit rating for quite some time. Being late with a mortgage payment is especially egregious.

How much debt you already have is right up there in importance as well. Even children know that you can’t pay back a loan if you don’t have enough money to go around. It is a rare person who will go without food to pay for shopping sprees, so having a lot of debt will also lower your score.

How long have you been in the credit world? Suppose you have had a decent credit history for many years. In that case, you are less of a risk than a recent graduate who has never bought anything on credit. But, of course, if you have had credit for a long time but have run into some situation that has made you miss payments or have had to file bankruptcy, being old won’t help you.

How To Improve Credit Score

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