Getting An Excellent Credit Score And Fixing A Poor One

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In order to qualify for a mortgage and purchase a home, as said several times previously, it is important to always have a very good credit score. It is basically a measure of your financial responsibility and can either allow you or deny you many opportunities

So what are some of the main things you need to know about credit scores?

A bad report will stay in your file for seven years!

The two biggest determiners of your score is the amount of debt you owe versus how much credit you have

You can receive a free credit report each year, but will have to pay for crucial information such as credit score and FICO

You can improve credit scores by keeping accounts and credit cards open and paid off for a long time. The longer the good standing account, the better. However, closing credit cards can negatively affect your score.

To rebuild a poor score, there are adjustments that can be made which can positively impact standings. There are simple ways to improve a difficult situation, such as paying bills on time, lower the debt/credit ratio as quickly as possible, and possibly setting up payment reminders.

Keep your finances simple – don’t use a credit card you will find hard to pay off. It is always recommended you have one debit and one credit card, and try to limit expenses to the debit card. If need be, dedicate some of your monthly income to your credit and bills so debts are settled with more ease.

Be careful of collection agencies. If they call and ask for money, make sure they ask a certain type of questions to make sure it is legitimate, without giving out very confidential information. Some cases turn out to be a scam.

When you are going through a difficult phase financially, limit expenses to the most necessary things, such as groceries, bills and gas for your car. Set a monthly budget for them so that the rest can either be saved or used to pay off an debt you have.