Who Needs Good Credit!?!?
Article by Matt Schaub
Credit Score? We don’t need no stinkin’ Credit Score!… Right?… WRONG! Like most people, when I was in my late teens and early twenties I didn’t have a clue about (much less care about) my Credit Score. Then I had to answer to the interest rate on the first car that I bought on my own!… OUCH! An ,000 car was going to wind up costing me over ,000 when it was all said and done!
HOW!?!?
I thought I was doing things well enough to have a fair credit score.
Credit builds Credit… Right???… Not Exactly!!!
While I was busy thinking I was BUILDING Credit, I was busy RUINING it!… Too much AVAILABLE Credit, too many floating balances, TOO MANY THINGS TOO UNDERSTAND!
Everyone NEEDS to understand their own Credit… and how to control if it improves or gets worse! Too complicated? Too many things to know and understand?… Not if you find the proper sources of information!
Nothing in life is free… right? Well… not always true!
Below I have copied the first TWO chapters of the book that helped me save my Credit… AND, in turn… SAVED ME LOTS OF MONEY!
Table Of Contents
Foreword – page 4Chapter One: How Credit Works – page 6Chapter Two: First Steps to Repairing Your Credit – page 9Chapter Three: Credit Reporting Agencies – page 13Chapter Four: Common Errors on the Report – page 17Chapter Five: Disputing Errors – page 23Chapter Six: Debt and Credit – page 30Chapter Seven: Strange Things that Affect Your Credit – page 34Chapter Eight: Working with Your Mortgage – page 38Chapter Nine: Making Money and Credit – page 45Chapter Ten: Bankruptcy – page 49Chapter Eleven: Your FICO Expansion Score and VantageScore – page 53Chapter Twelve: Know When to Hold ‘Em – page 57Chapter Thirteen: Credit and Debt Counseling Services – page 62Chapter Fourteen: Managing Debt page – 67Chapter Fifteen: Court Cases – page 74Chapter Sixteen: Borrowing Without Interest – page 79Chapter Seventeen: Dude! Where’s My Identity? – page 84Chapter Eighteen: Common Credit Scams – page 89Chapter Nineteen: All About Cards – page 95Chapter Twenty: The Fair Credit Billing Act – page 100Chapter Twenty-One: Marriage and Its Effect on Credit – page 105Chapter Twenty-Two: Alternate Credit Files and ChexSystems.. – page 111Chapter Twenty-Three: Areas Credit Affects You – page 117Chapter Twenty-Four: Other Credit Tips – page 120Chapter Twenty- Five: Summing Up – page 125
Foreword
Does this sound like you?
You do not have a very good credit score but you want to change yourcredit report for the better to help yourself and your family. Why wouldn’tyou? You may want to do this quickly, adding positive aspects to yourcredit report. But don’t be fooled into getting rid of all the negatives on youraccount and not leaving any positive credit ratings; this then gives you nocredit score, which can in the long run be just as damaging as a negativeone.Or, do you have high debt and feel there is no way out? If this is you, thenyou probably have some good credit, but you have so much bad credit thatyou have debt encircling you and getting ever closer. You need to be ableto pay back your debts for as little as possible to start on the road ofcorrecting your credit rating. Again, you need to be able to add positivecredit to your report to counteract the negatives.If you have no credit whatsoever, you are in a minority. The good thing tobe said about that is that all you really need to do is get some credit ontoyour account. The trick with credit is to know when enough is enough. Don’tbe tempted to get too much credit and not be able to pay it back, thusdestroying your credit rating. That will just send you rushing back to refer tothis guide once again, so just make sure you read it carefully the first timeto avoid that!
In other words, this guide is for anyone and everyone who relies on creditin their day-to-day lives-and in today’s society, that’s all of us. Followalong carefully and learn the secrets the credit card companies don’t wantyou to know-the secrets that will let you lead a more secure, happier, andbetter life.
Chapter One: How Credit WorksHaving bad credit affects not just what you want now, but also what youcan have in years to come. Your credit score will affect everything from hirepurchasing to getting a mortgage. That is why it is vital you keep any goodcredit that you have and keep the bad credit ratings away.Bad credit ratings generally come from missed payments on things such asloans, mortgages and credit card payments. To sum it all up, bad creditcomes from any time that you don’t pay back any money that you haveborrowed from banks, building societies or other lenders.
What Kind of Credit Do You Have?
Are you in the so-called ‘prime sector,’ the 40% of the population that hasan excellent credit rating? If you miss one mortgage repayment you maydrop a point or two, but overall it will not affect your credit rating.You can see that most people aren’t in this group. 60%Sixty percent of usare in the sub-prime sector with a less than perfect credit score. The way inwhich your credit rating is scored varies greatly when you are in this group.If you miss a payment on your mortgage you may drop 20 points on yourcredit score; if you miss a payment on your credit card you may lose more.But just imagine: If you were in the prime sector of ratings, you may notdrop any points whatsoever. That might not sound fair, but it’s true. Also,there is no way to know for sure how many points you will drop for missingpayments. It’s completely unpredictable, and you never know exactly whatis happening.
That is why you need to read this book!
Credit company bosses are getting fat on the profits you give them ininterest payments each month. Don’t let that happen! That is why youshould never have more debt than a quarter of what you earn per year.This way you can be sure you can make the payments on time. Other thana mortgage or maybe a business loan, you should never get yourself intoany more debt for whatever reason. Remember: Any such debit will hangaround your neck for months, maybe even years.
Building Up Credit
If you need to build up credit because you don’t have any, or because youhave extremely bad credit, then you need a plan to get back on the righttrack. Pretty much everything you do in your life affects your credit rating,even things that you would never imagine. This includes things such as:* How much car insurance you pay,* How much house insurance you pay,* How you pay your insurance bills, and* Possibly even health insurance.Even your job can also affect your credit rating more than you would think.
The Myth of Paying It Off
If you have no credit but you manage to get a credit card, do you think it isbetter to pay the balance all off at once every month, or pay it off ininstallments? Many people would say pay it off every month. After all, thatway you have no debt, pay no interest, and establish yourself as a reliableperson, right?But think about it: If you pay it off in full every month, you are effectively notborrowing any money; therefore, you do not have any score on your creditrating. If you pay the debt off in installments you are building up your goodcredit rating-provided you make the minimum payment on time.
Chapter Two: First Steps to Repairing Your CreditYou may think that the best way to repair your credit rating is to remove allof the bad credit from your rating. This is not entirely true. It may soundweird, but in actual fact a less-than-perfect credit score is sometimes higherin the list of credit scoring than a 100% perfect score. In somecircumstances, you can raise your credit rating by more than 100 pointswithout actually removing every negative score from your credit list.You need to get your hands on your credit report
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