Ways to IMPROVE your Credit Score!

I just read this article this morning and found it to be very pertinent for the current times. Every homeowner I talk to is always wondering what will happen to their credit in doing a short sale... the hard part with credit scores is that there is no black and white answers. It's quite a gray subject matter actually. However, there are concrete ways in which you can IMPROVE it!! So regardless of what happens during this season of foreclosures and credit crunch, it's always best to be as proactive as possible on the things that you CAN control. So maybe you cannot control what's happens to your score if you're behind on payments BUT you can control how fast you get that score back up!
I'm all about being as proactive as possible so hopefully this will be beneficial for you to read. PLUS, if you want more information in ways you can increase your credit score and debt to income ratio, I'd also suggest getting in touch with Terry Greene, The Credit Coach of All Credit Coaches.

ENJOY...

"Here are a few suggestions on how to increase your credit score:

• Establishing good credit takes time, so start early - professionals say about 18 months. One of the easiest ways to begin building credit is to responsibly manage a credit card

• Paying your bills on time and in full (if possible) - having late or missing payments can drastically reduce your credit score. If you can’t make the full payment on a credit card, at least make the minimum payment

• Only use what you need - as tempting as a “pre-approved” credit card may seem, if you don’t need it then don’t bother, especially if you are unsure of the ability to pay off debts - not to mention the fact that opening up many accounts in a short period of time can negatively affect your credit

• Keep your balances down - try not to go over the limit on your credit card - the higher your balance on your accounts, the harder it will be to pay off and can more negatively affect your credit score

What is a credit score?

From Wikipedia

A credit score is a numerical expression based on a statistical analysis of a person’s credit files, to represent the credit worthiness of that person. A credit score is primarily based on credit report information, typically sourced from credit bureaus.

Lenders, such as banks and credit card companies, use credit scores to evaluate the potential risk posted by lending money to consumers and to mitigate losses due to bad debt. Lenders use credit scores to determine who qualifies for a loan, at what interest rates, and what credit limits. The use of credit or identity scoring prior to authorizing access to granting credit is an implementation of a trusted system.

Credit scoring is not limited to banks. Other organizations, such as mobile companies, insurance companies, employers, landlords, and government departments employ the same techniques. Credit scoring also has a lot of overlap with data mining, which uses many similar techniques."

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