Are You Hurting Your Credit Profile?

Credit scores have a large impact on our financial success. Having a strong score means you have the opportunity to take advantage of the best available interest rates on mortgages, auto loans, refinancing student loans, even cheaper auto insurance. To get good interest rates, you typically need to have a score above 700, but the best deals will go to consumers with scores above 750.

Credit scores reward responsible behavior, if you live within your means and pay your bills on time you should have a good score. However, being responsible does not always mean that you will have a strong credit score.

Here are three common mistakes that responsible people make, costing them points on their credit score, and money in the long run.

  1. Having only one credit card, and using it for everything.

Many consumers limit themselves to one credit card and pay their balance in full every month. This is a great practice as you avoid getting charged interest on the account. However, using only one card could harm your credit score by driving up your credit utilization ratio, an important part of how your score is calculated.

Your credit utilization is the percentage of available credit that is being used. If you have a credit limit of $1,000 and a balance of $200, your utilization would be 20%. This is calculated for each individual credit card and across all credit card accounts. High utilization can have a significant negative impact on your score. Keep utilization below 20%, but if you want the biggest positive effect on your score, keep it between 1-3%.

Utilization is important to lenders for two reasons. First, high utilization shows them you can’t control your spending. If you consistently max out your credit cards, you appear to be very risky to lend to. Second, credit limits are calculated based on your income, so when you use too much of the credit available to you, banks will think you have too much debt relative to your income, whether you pay them off in full or not.

You can lower your utilization in two ways. First, you can make your credit card payments more frequently. Your goal is to keep your balances low, but still more than zero. Paying down your balance in the middle of the month will reduce your statement balance and your utilization. Second, you can ask your bank for a credit limit increase, which will increase your available credit, making your statement balance have a lower effect on your utilization.

  1. Not knowing what is on your credit report.

Strange things often appear on credit reports. Check your credit reports once a year to make sure that all accounts are accurate and up to date. If you see any incorrect information on your credit report, you need to take action. CreditServices.com is an industry-leading credit repair company, our Attorney-Reviewed service levels can help you get negative remarks removed from your credit report.

  1. Paying collection items first.

Every once in awhile, you may run into unforeseen problems and miss payments. Responsible consumers work hard to pay back all of the money they have borrowed. However, when it comes to your credit score, keeping active accounts current is more important than paying on a collection item.

Once a collection item appears on your credit report, the damage has been done. So skipping credit card payments to pay the collection will negatively impact your credit score even more.

Collections should be dealt with only after your obligation to active creditors has been fulfilled in order to maintain your credit score and avoid further damage. Also consider working with our Debt Settlement department to settle your collections and save yourself money.

Credit scores are complex.

Making the most of your credit score, and protecting your financial future is not easy. A lot of information goes into calculating your credit score, which can get overwhelming at times. Since credit is such an important factor in so many purchasing situations, you need to have a firm grasp on where your credit profile stands. CreditServices.com can help repair negative items on your credit report, while also teaching you how to better manage the accounts you have, and inform you as to if you should open or close any other accounts based on your current profile. Our Credit Advisors are experts on the FICO formula and can help you develop a better understanding of how to manage your accounts now and in the future.

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Each person’s credit situation is unique. Results may vary, and CreditServices.com makes no guarantee of any particular result. The information in this site is intended for general informational purposes only, and is not to be construed as legal, tax, accounting, or other professional advice.  As such, it should not be used as, or relied upon, as a substitute for seeking professional legal, tax, accounting, or other advice. All information in this site is provided “as-is”, with no guarantee of completeness, accuracy, timeliness, or other results obtained from its use. In no event is CreditServices.com, its Affiliates, or their agents or employees liable to you or anyone else for any decision made or action taken in reliance on the information in this site. “Affiliate” means any entity that directly or indirectly owns or controls, is owned or controlled by, or is under common ownership or common control of the party in question.

Your Credit Reports

A credit report is a record of your credit history which includes information such as:

-Your identity: name, address, date of birth, Social Security Number, and potentially employment information.

-Your existing credit: information pertaining to your credit history including revolving (credit cards) and installment accounts (student loans, car loans, mortgages…), how much you owe, and your payment history.

-Public records: Information regarding any judgments, tax liens, or bankruptcy in your credit history.

-Credit inquiries: List of companies or parties that recently requested a copy of your credit report for the purpose of lending.

Your credit report is used by lenders, insurers, employers, and others to assess your management of financial responsibilities.

-Lenders will use your reports to determine whether you will qualify for a loan, and what interest rate you will receive.

-Insurers can use them to approve or deny you for insurance coverage and to set your rates.

-Utility companies may use your credit report to determine whether they should provide you with their services.

-Employers, if given permission, may use credit reports in their hiring decision.

-Landlords may use the information on your credit report to determine whether they will rent to you or someone else.

Your information is collected by three major credit bureaus; Equifax, Experian, and Transunion. They gather the information that is contained in your credit reports, then provide the information to companies that request it to make the decision on whether to do business with you.

The credit bureaus have to manage all of this information on millions of Americans, so how accurate do you think all of the information is? Credit bureaus are not responsible for the accuracy of the information that they supply to lenders, that is your job!

Check your credit reports if you haven’t in awhile to make sure they are accurate, if they aren’t, contact us and we can get you started on the right path to achieve your goals.

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Each person’s credit situation is unique. Results may vary, and CreditServices.com makes no guarantee of any particular result. The information in this site is intended for general informational purposes only, and is not to be construed as legal, tax, accounting, or other professional advice.  As such, it should not be used as, or relied upon, as a substitute for seeking professional legal, tax, accounting, or other advice. All information in this site is provided “as-is”, with no guarantee of completeness, accuracy, timeliness, or other results obtained from its use. In no event is CreditServices.com, its Affiliates, or their agents or employees liable to you or anyone else for any decision made or action taken in reliance on the information in this site. “Affiliate” means any entity that directly or indirectly owns or controls, is owned or controlled by, or is under common ownership or common control of the party in question.

Negative Items On Your Credit?

Many of your neighbors, friends, and coworkers are unable to take advantage of the best, or even average interest rates on credit cards, auto loans, and mortgages. The best interest rates are only for those with excellent credit. So if you want to take advantage of historically low interest rates before they rise, you need to take a look at your credit, and get active improving your profile.

Most Americans are also unaware of what makes up their credit score, including what will make it subprime, and how long these negative items stick to your credit profile. So how long do some of these negative items impact your financial situation?

Bankruptcy:

One of the most negative items you can have on your profile is a bankruptcy. Chapter 13 bankruptcies will stay on your credit report for 7 years, while a Chapter 7 bankruptcy will impact your credit score for 10 years from the date that you filed for the paperwork. If your bankruptcy was dismissed and your debts weren’t discharged, then it will stay on your report for 10 years from the date it was dismissed. If you had a strong credit score in the past and you declare bankruptcy, you will see a large impact on your credit score. If you previously had subprime or bad credit, then the impact of bankruptcy won’t be as great. If your bankruptcy included numerous accounts, the impact can be serious.

Lawsuits and Judgments:

If you have been sued, or had a judgment against you, it will also stay on your credit report for up to 7 years from the date it was filed, made against you, or until the statute of limitations has expired. Once you have paid off the judgment against you, even though paid off, it will impact your credit score for 7 years.

Tax Liens:

Even when you pay them off as soon as possible, the tax lien will stay on your credit report for 7 years.

Delinquent Accounts:

A delinquent account will also affect your credit profile for 7 years from the date that the account was declared delinquent. If you catch up on your payments, and maintain a good payment history, the negative mark will still remain for 7 years. Payment history makes up 35% of your FICO score. This, combined with the fact that the negative mark will stay on your report for 7 years is why on-time payments are crucial to having a good credit score.

Repossessions and Collections:

Any time that you have an account referred to a collection agency, or have something like a car or major appliance repossessed, it will have an impact on your credit score. These marks will stay on your credit report for 7 years plus 6 months after the first missed payment. If there is a charge-off marked on your report, that means that after the 6 months of non-payment, the company has removed it from their balance sheet, but you still owe the debt. Unpaid debts on your credit profile will make it difficult to get any credit in the future. Take care of your debts on time unless you want them to stick with you for 7 years or more.

Child Support:

Just like any other legally binding debt such as credit card payments, mortgage payments, or student loans, if you get behind, or make late payments, they will remain on your credit report for 7 years. Treat them like any other account, and make the payments on time.

Student Loans:

Student loan debt is guaranteed or insured by the federal government, so they carry much more serious consequences than other types of debt. You cannot discharge student loans by declaring bankruptcy, and defaulting on your student loans will stay on your credit report for much longer than 7 years.

Credit Inquiries:

Inquiries will show up on your credit any time that you apply for a new form of credit. They can stay on your report for 2 years, but only impact your score for the first 12 months. This will not have a disastrous impact on your score, however, they cost you 5-15 points each, so too many inquiries can significantly lower your credit score.

What you can do to clean up your credit profile:

While it is not an easy process, disputing the accounts on your profile can help you get rid of some of the negative remarks on your profile. Aside from challenging your negative accounts, CreditServices.com will teach you how to build positive accounts on your credit profile to counteract any negatives that might remain, speeding up the process of improving your financial situation.

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Each person’s credit situation is unique. Results may vary, and CreditServices.com makes no guarantee of any particular result. The information in this site is intended for general informational purposes only, and is not to be construed as legal, tax, accounting, or other professional advice.  As such, it should not be used as, or relied upon, as a substitute for seeking professional legal, tax, accounting, or other advice. All information in this site is provided “as-is”, with no guarantee of completeness, accuracy, timeliness, or other results obtained from its use. In no event is CreditServices.com, its Affiliates, or their agents or employees liable to you or anyone else for any decision made or action taken in reliance on the information in this site. “Affiliate” means any entity that directly or indirectly owns or controls, is owned or controlled by, or is under common ownership or common control of the party in question.

Millennials: Build Credit Now

Many millennials saw their parents hit a very rocky financial situation during the Great Recession, creating a fear of credit among the generation. Understanding the difference between credit and debt is the most important aspect of getting over this fear. Credit is a financial tool, that when used correctly can provide you with valuable purchasing power. Debt is a problem caused by the misuse of credit.

millennials credit cards

Using credit wisely is an incredibly important aspect of becoming financially successful now and in the future.

 

Your credit history is everything you have done in the past with regards to using credit. Credit history includes the amount of credit you have used, your payment habits, and if creditors have had to resort to using collections agencies or the legal system to get you to repay your debts.

When considering whether or not to lend you money, a lender will attempt to determine what the odds are that you will repay a debt. Your credit history is the best indicator they have of your credit risk. They assume that you will continue to behave in the future as you have in the past. But if you have no past use of credit, they will view you as risky because they have no record of you being willing and able to manage debt.

After establishing a credit history, you will want to make sure that your reports are reflecting accurate information to ensure that you aren’t being judged unfairly. Lenders look to your credit profile as a record of your credit history and they will likely assume that the accounts listed in your credit reports are accurate. The problem is that very often these items are inaccurate or untimely, misleading, incomplete, unverifiable, biased or unclear.

If your credit reports contain questionable negative items, you have the right to dispute them in an effort to get them corrected or removed entirely. CreditServices.com will help you make sure your profile is reporting accurately, and teach you how to build your credit. We have helped thousands of people with unfair credit reports, and we can help you too!

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Each person’s credit situation is unique. Results may vary, and CreditServices.com makes no guarantee of any particular result. The information in this site is intended for general informational purposes only, and is not to be construed as legal, tax, accounting, or other professional advice.  As such, it should not be used as, or relied upon, as a substitute for seeking professional legal, tax, accounting, or other advice. All information in this site is provided “as-is”, with no guarantee of completeness, accuracy, timeliness, or other results obtained from its use. In no event is CreditServices.com, its Affiliates, or their agents or employees liable to you or anyone else for any decision made or action taken in reliance on the information in this site. “Affiliate” means any entity that directly or indirectly owns or controls, is owned or controlled by, or is under common ownership or common control of the party in question.

Master Credit Card Use: 3 Tips

  1. Pay Mid-Cycle

The balances appearing on your credit reports are usually based on the balance at the end of your billing cycle. Go online to make a payment a few days before the end of the billing cycle so the balance that gets reported to the credit bureaus is lower.

shopper

  1. Avoid Paying Interest

Credit Card users who do not carry balances every month and have signed up with a credit card that offers a grace period have at least 21 days from the time of purchase to pay the charge in full without accruing interest. Grace periods will not be included for balance transfers or cash advances.

  1. Increase Your Limit

Request a higher limit on your credit card to protect your credit rating. Raising the gap between your balance and limit will give you a better credit utilization ratio, which will be favorable for your credit score. Be careful with this tip though, just because the money is available doesn’t mean you should use it, simply use it as a credit building technique.

CreditServices.com credit advisors will walk you through the credit repair process, coaching you on valuable credit building techniques like these. These tips are very effective, and when advised on exactly what time to utilize these tactics in your personal Credit Guide, you will see the best results. That is why we are here, we are specialists in credit repair, and we can help you!

See what our customers have to say about us and then contact us for a free consultation today!

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Each person’s credit situation is unique. Results may vary, and CreditServices.com makes no guarantee of any particular result. The information in this site is intended for general informational purposes only, and is not to be construed as legal, tax, accounting, or other professional advice.  As such, it should not be used as, or relied upon, as a substitute for seeking professional legal, tax, accounting, or other advice. All information in this site is provided “as-is”, with no guarantee of completeness, accuracy, timeliness, or other results obtained from its use. In no event is CreditServices.com, its Affiliates, or their agents or employees liable to you or anyone else for any decision made or action taken in reliance on the information in this site. “Affiliate” means any entity that directly or indirectly owns or controls, is owned or controlled by, or is under common ownership or common control of the party in question.

Strong Credit For Home Lending!

Looking to obtain lending for a home?

Strengthening your credit score is a very important step to take, the earlier you start, the earlier you will get into your new home!

While there are plenty of qualified buyers in the 580 credit score range, today’s market is looking for 640 to 660 as a minimum. These scores will get you into a house, however a FICO score of 700 to 720 will get you a better deal, and 750+ will get you the best rates on the market.

The first step in determining your standing is pulling your credit to make sure your profile is strong enough to move forward and that you aren’t being penalized for old accounts.

At CreditServices.com, our credit analysts will walk through this process with you. Analyzing your credit report and disputing accounts that are invalid is a very tedious process, and something that we excel with. We are a top 1% performing Credit Service Organization, and our past clients say it the best.

If you are looking to improve your credit for mortgage approval, the experts at CreditServices.com will help you from start to finish, and achieve industry leading results by utilizing a strong background and knowledge of the requirements of the mortgage lending industry, and the steps that need to be taken in order to meet them.

Contact us today, and qualify for the loan you deserve sooner!

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Each person’s credit situation is unique. Results may vary, and CreditServices.com makes no guarantee of any particular result. The information in this site is intended for general informational purposes only, and is not to be construed as legal, tax, accounting, or other professional advice.  As such, it should not be used as, or relied upon, as a substitute for seeking professional legal, tax, accounting, or other advice. All information in this site is provided “as-is”, with no guarantee of completeness, accuracy, timeliness, or other results obtained from its use. In no event is CreditServices.com, its Affiliates, or their agents or employees liable to you or anyone else for any decision made or action taken in reliance on the information in this site. “Affiliate” means any entity that directly or indirectly owns or controls, is owned or controlled by, or is under common ownership or common control of the party in question.

Avoid These Common Credit Card Mistakes

  1. Getting too many credit cards:

While having a good debt-available credit ratio will build your credit and look favorable to lenders, if you have too much available credit, a lender may think: “What if they decide to max out all of these cards, what would the debt-income ratio be?” Not to mention that multiple credit inquiries will lower your credit score and may lead a lender to believe you are desperate for more money.

  1. Paying your bill late:

Not only will you face a late payment charge that may be higher than your minimum payment, this will show up on your credit report and lower your credit score.

  1. Ignoring your monthly statement:

Avoid late payments by checking your monthly credit card statements. Checking your monthly credit card statements will also allow you to make sure charges are correct, and catch identity theft, if you wait too long it may show up on your credit report.

  1. Exceeding your credit limit:

If you are approaching the top of your credit limit, try to use cash for subsequent purchases. If you don’t, your purchase may be rejected, unless you have authorized your card company to charge hefty over-the-limit fees.

  1. Misunderstanding introductory rates:

With introductory rates, often offered on big-ticket items, interest accumulates from the day of purchase. If you don’t pay off the debt during the introductory period, the interest will be charged retroactively, more than likely at a very high rate.

 

These are common mistakes made with credit cards that can damage your credit and hinder your ability to qualify for lending opportunities. The more you can learn about the terms of the credit cards you utilize, and credit card use in general, the better you will be able to manage your debt and position yourself for a strong credit score and financial life!

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Each person’s credit situation is unique. Results may vary, and CreditServices.com makes no guarantee of any particular result. The information in this site is intended for general informational purposes only, and is not to be construed as legal, tax, accounting, or other professional advice.  As such, it should not be used as, or relied upon, as a substitute for seeking professional legal, tax, accounting, or other advice. All information in this site is provided “as-is”, with no guarantee of completeness, accuracy, timeliness, or other results obtained from its use. In no event is CreditServices.com, its Affiliates, or their agents or employees liable to you or anyone else for any decision made or action taken in reliance on the information in this site. “Affiliate” means any entity that directly or indirectly owns or controls, is owned or controlled by, or is under common ownership or common control of the party in question.

Our Offering

CreditServices.com™ Service Levels have one of the Nation’s highest success rates among Credit Service Organizations. Specific services include validation through our meticulous bureau discovery process, credit rebuilding strategies and options, credit education on profile management, coaching on the FICO™ and Consumer scoring formulas, and continued support with advising and consulting throughout your specific credit service process.

We are an award winning consumer-oriented company and love to deliver the results that our clients deserve! Whether your goal is obtaining a mortgage, auto loan, or general credit improvement for purchasing power, we have a program for you.

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Each person’s credit situation is unique. Results may vary, and CreditServices.com makes no guarantee of any particular result. The information in this site is intended for general informational purposes only, and is not to be construed as legal, tax, accounting, or other professional advice.  As such, it should not be used as, or relied upon, as a substitute for seeking professional legal, tax, accounting, or other advice. All information in this site is provided “as-is”, with no guarantee of completeness, accuracy, timeliness, or other results obtained from its use. In no event is CreditServices.com, its Affiliates, or their agents or employees liable to you or anyone else for any decision made or action taken in reliance on the information in this site. “Affiliate” means any entity that directly or indirectly owns or controls, is owned or controlled by, or is under common ownership or common control of the party in question.

Impact of Cutting Credit Cards

Your Credit Utilization Ratio (30% of your FICO score) is calculated by how much available credit you have in comparison to how much debt you are currently carrying. If you have cards with low balances and available credit on them, that raises your available credit to total debt ratio, thus increasing your score. Closing credit cards can also negatively impact the Credit History portion of your FICO score (15%). If you need to close out a credit card because you are too tempted to use it, make sure not to close the oldest one or the card with the highest limit.

Is your credit in the right place?

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Each person’s credit situation is unique. Results may vary, and CreditServices.com makes no guarantee of any particular result. The information in this site is intended for general informational purposes only, and is not to be construed as legal, tax, accounting, or other professional advice.  As such, it should not be used as, or relied upon, as a substitute for seeking professional legal, tax, accounting, or other advice. All information in this site is provided “as-is”, with no guarantee of completeness, accuracy, timeliness, or other results obtained from its use. In no event is CreditServices.com, its Affiliates, or their agents or employees liable to you or anyone else for any decision made or action taken in reliance on the information in this site. “Affiliate” means any entity that directly or indirectly owns or controls, is owned or controlled by, or is under common ownership or common control of the party in question.