It should be your business to clean up your credit

November 5th, 2009 by Lloyd Pro Group Inc.

Atlanta business insuranceIt still baffles me that here in the good ol’ USA we have the greatest education system in the world and yet our children are never taught in the school system how to balance a checkbook or how to protect their credit. Go figure?

The result? Just look around you and see for yourself.

So then, I guess a little “Credit 101″ class could benefit us all then,don’t you agree?

1- View your credit report like a “report card” of how well you have paid your bills in the past. Now you can see why it is so important to get a “high” mark. Remember, it is your credit or “FICO” score that lenders, credit card companies, landlords and even some employers us to make their final decision about you.

2- What’s a good score? FICO scores range between 300-850. Typically credit below 620 means you will get pretty tough terms or even be denied credit. On the other hand, credit over 800 usually leads to royal treatment.

3- Get the facts first: Did you know that the law now provides for you and I to have access to 1 free credit report a year from each of the three national credit reporting bureaus? In case you didn’t know, we are talking about Experian, TransUnion and Equifax. This report will show how much credit you have, how much you have used and whether you have paid your bills on time. By the way, if you are ever denied credit for some reason, you can also get a free report from the agency that was used to turn you down.

While your credit report details your credit history it does not give you your “credit score”. You can pay a small fee and get your score at any time from myfico.com

4- Pay up on time: Here is a simple thing although it seems to elude a lot of people. When you make a late payment your credit score will drop. Now you can see why it is wise to use the automatic bill payment systems that are offered. What if you can’t pay it off? Call them and talk to them about your situation. Then pay down what you can’t pay off.

5- Fix those mistakes: Did you know that over 70% of credit reports contain errors? Now you know why it is essential to check yours annually. Ask the reporting agency to correct any errors you find.

6- Keep those accounts open: Keep the accounts that you have had the longest open especially the Visa and Master Cards, which are more important than store cards. Remember, just because you “have” the  credit doesn’t mean you have to “use” the credit. You want as big a ratio as possible between what you “have” and what you actually “use”.

7- Avoid bankruptcy: Bankruptcy can haunt your credit report for up to 10 years. So do what ever it takes including a second job or eating peanut butter and jelly every night for dinner.

8- Get some help: Clark Howard suggests using a non profit consumer credit counseling agency that might be able to negotiate some special terms to help you.

By applying these suggestions you can actually increase your credit score gradually . These tips apply whether you are an individual or a business. In fact you can just think of using these tips as a little Atlanta insurance against bad credit.

Why not try them this week?

  • Share/Bookmark
Posted at 5:02 pm: No comments

Leave a reply