It is no secret that the better your credit history the better your interest rate will be purchasing cars, furniture or a home using a mortgage.
Particularly when shopping for a home your credit will be evaluated primarily based upon the credit scores. These credit scores are generated when credit reporting agencies access your credit history.
Were all aware of this, but few of us really know how these scores are generated. Most think the scores are just about payment history.
Although a good on time history of payments is no doubt very important to a good credit score it is far from being the total picture. Other equally important factors play a role to complete the picture.
Since we started with payment history you should be aware that you're not late until thirty days post the due date. Keep that in mind when in a pinch. You pay all the way up til the end and still have a clean payment history.
When you have lots of available credit which is relatively unused it looks better on your scores. It basically means you have discipline and cushion to fall back on if in need.
High balances on the credit cards signal that you may be in trouble. Any financial storm can cause huge damage to whole credit picture. Scores don't like this signal.
A lack of credit history typically works against credit scores. Do yourself a favor and get 2 or 3 slats of plastic. Start using them immediately and pay on time of course.
Remember, credit scoring is somewhat sensible in what it factors. That being the case do not run out and get 10 credit cards. This could be seen as trouble by the scoring system.
You want to use your new credit cards every single month and every month you want to pay off the balance. You'll be shocked at how much your scores rise in a very short time.
Lastly, if you do have derogatory marks try your best to make the blunder as far away from the home purchase as possible. The longer your derogatory marks season the better your scores get.
Most of credit scoring makes sense. Use logic when developing your credit picture and you'll be just fine.
Particularly when shopping for a home your credit will be evaluated primarily based upon the credit scores. These credit scores are generated when credit reporting agencies access your credit history.
Were all aware of this, but few of us really know how these scores are generated. Most think the scores are just about payment history.
Although a good on time history of payments is no doubt very important to a good credit score it is far from being the total picture. Other equally important factors play a role to complete the picture.
Since we started with payment history you should be aware that you're not late until thirty days post the due date. Keep that in mind when in a pinch. You pay all the way up til the end and still have a clean payment history.
When you have lots of available credit which is relatively unused it looks better on your scores. It basically means you have discipline and cushion to fall back on if in need.
High balances on the credit cards signal that you may be in trouble. Any financial storm can cause huge damage to whole credit picture. Scores don't like this signal.
A lack of credit history typically works against credit scores. Do yourself a favor and get 2 or 3 slats of plastic. Start using them immediately and pay on time of course.
Remember, credit scoring is somewhat sensible in what it factors. That being the case do not run out and get 10 credit cards. This could be seen as trouble by the scoring system.
You want to use your new credit cards every single month and every month you want to pay off the balance. You'll be shocked at how much your scores rise in a very short time.
Lastly, if you do have derogatory marks try your best to make the blunder as far away from the home purchase as possible. The longer your derogatory marks season the better your scores get.
Most of credit scoring makes sense. Use logic when developing your credit picture and you'll be just fine.
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