Credit Card Checkup

Annual Credit Health Checkup At the beginning of the year, do a self-assessment of your creditworthiness for the financial challenges you may face. O Credit l'kre-dit O A loan step 1 Pay Your Bills on Time 2 The ability of a person to borrow money 3 Influence or power derived from enjoying the confidence of others Making timely payments is one of the best things you can do for your financial reputation: step 2 Go ahead... step on scale Pay all your bills and catch up on late payments before you do any other work Credit reporting companies gather and sell information about consumers to both lenders and consumers. on your finances. REVIEW YOUR CREDIT REPORTS 30 million Under the Fair and Accurate Credit Transactions Act, you can get one free credit report once every 12 months by request from each of the three nationwide credit reporting companies: SCAM ALERT free credit reports are estimated to be delivered annually to about 15.9 million individual consumers through the authorized Neither the authorized Web site nor the credit reporting EQUIFAX The three nationwide credit reporting companies operate a single Web site for consumers to request free reports - annualcreditreport.com- which is the only authorized companies will call you first to ask for personal information or send you an email asking for personal information. Experian TransUnion Web site. You may order reports from each of the three consumer reporting companies at the same time, or stagger them. online source for free credit reports. III|| FICO SCORE The Fair Isaac A 850 Corporation E Excellent calculates | Lenders determine your creditworthiness based on their own interpretations of all the information available to them, including the information in one or more credit reports. HOW DOES INFORMATION the most ABOUT YOU AFFECT widely used and familiar A FICO SCORE? 700 type of credit score known Lenders use credit scores to assess the risk a potential borrower will not repay a loan. CREDIT SCORING as a FICO Credit scoring is a type of calculation applied to factors in your credit history that measures your likelihood to pay your debt. score. Scores range from 300 30% Amounts 35% Payment history 550 owed to 850, with lower-risk (more responsible) Consumers do not have one single numerical score that is used by all credit reporting companies and all lenders for all purposes because there are many scoring methods and score ranges used. 400 borrowers on the upper end. 300 Financially Dead 10% New credit 15% Many of the scores calculated for and used by lenders are not available to consumers. Credit scores influence Length of credit history 10% Types of credit used the marketing offers consumers receive. Credit scores can affect account-management decisions, such as changing credit limits or changing interest rates. U.S.Cities with the Highest Credit Scores Average ME NH scores 1 Wausau, Wis. 789 ORIIII NY I MI 2 Minneapolis, Minn. 787 PA CT IL 8 IN OHIIIIIIIIIII II---DQMD NJ -I-IwV VA DE 3 Madison, Wis. 785 4 Cedar Rapids, lowa 781 KY III---II ARI TN II-- NCIIII MS AL GA SC San Francisco, Calif. 781 6 Green Bay, Wis. 780 a 542 6H 7 Boston, Mass. 779 ILA I- FLIII- AK I 10 Peoria, I. 778 Sioux Falls, S.D. 778 La Crosse, Wis. 777 1 Harlingen, Texas 686 4 Monroe, La. 706 7 Bakersfield, Calif. 709 Jackson, Miss. 701 Shreveport, La. 706 8 Las Vegas, Nev. 709 U.S. Cities with the Lowest Credit Scores Corpus Christi, Texas 702 6 Augusta, Ga. 709 9 Tyler, Texas 710 10 El Paso, Texas 710 Source: Experian analysis based on average VantageScore (range from 501 to 990) by DMA from January through June 2011 Understand step 3 that all lenders do not necessarily report to all 3 credit reporting companies, so errors may Look for Errors on Credit Reports Compare credit appear on one report but not on others. reports to your account statements. Look for evidence of identity theft or activity that is not Realize that yours. your credit scores are likely to be different on different reports based on variable calculation Scrutinize accounts described by any terms other than "current" methods and differences in the data available on the calculation or "paid as agreed." date. CORRECT ERRORS .... Credit reporting companies must investigate unless they consider a dispute frivolous. Contact in writing Contact in writing Provide copies of any documents that support the credit reporting company that provided the report. the company or person who provided the disputed information. your assertion. step 4 Review Your Payment History A credit reporting company can report most types of derogatory information Accurate negative Late payments and past due amounts weigh heavily on your credit reputation. information for 7 years and can only be removed bankruptcy information for 10 years. with the passage of time. Take time step 5 Review Your Balances to consider the things creditors look at: How recently have you made late payments? A Have you made one or a few late payments because you were absentminded? Review the total amount you owe and the individual balances on various types of accounts-such as credit cards, installment auto loans, and mortgages. How many days past due were your Investigate options for setting up automatic payments. accounts? Consider scheduling e-mail or smartphone reminders. What amount was past due? Consider asking courteously in writing that a lender remove a late payment from your credit report if you otherwise have been a good customer. A lender does not have to grant you this favor, but a good reputation matters. B Do you have significant delinquencies because you are having trouble paying your bills? Were any colle actions taken? Contact your creditors directly, explain your situation and ask if it is possible to reduce your payments to a level you can manage. Think carefully before consolidating credit card debt through a second mortgage or a home equity line of credit, which are now offered at very low rates. Remember that credit card debt Analyze carefully your credit cards with the highest balances, including those with low interest rates, because the proportion of your credit limit used on a credit card, regardless of its interest rate, is a factor in determining your creditworthiness. SCAM ALERT is considered "unsecured debt," while mortgages and home equity loans are "secured debts" that require you to put up your home as collateral. If you can't make the payments on secured loans, you could lose your home. Many predatory companies- even some nonprofits-target consumers who have poor credit histories with promises to clean up their credit reports. The truth is: Credit repair companies and credit counselors cannot remove accurate negative information from your credit report. Consider contacting a reputable credit counseling organization-such as one offered by a university, military base, housing authority, or branches of the U.S. Cooperative Extension Service- if you have trouble sorting through your options. Understand that lowering the balances on any of your credit cards has few downsides. Yet, if you close credit card accounts after paying down your balances, you could increase the ratio of your remaining balances to your total credit limits, which could have an effect on your credit reputation. If You Have Credit Cards in Your Wallet If You Have No Credit Cards Think about Look at the total length of your credit history and compare it to the age of your oldest open credit card. Investigate applying for a low-interest credit card if you do not have any revolving cautiously researching and using a secured Consider balance transfers to cards with lower interest rates only in the full context of all credit the factors in your credit report, including your present credit limits, credit history and any recent credit lines Consider whether your oldest credit card is serving a valuable purpose in your history. Some evidence of responsibly managed credit cards with low card that requires a security deposit by providing a benchmark that shows the longevity of your credit history. Think about keeping (which is different from an upfront fee credit or a stored-value debit card) to build a credit history if you are young or have had credit problems in the past. new account balances can be applications. a good thing. this account open and using it, if sparingly, even if it has a high interest rate. step 6 Review the Length of Your Credit History and Any Recent Applications Understand that any recent activity-such as applying for new credit cards, transferring balances or closing credit card accounts-may affect your credit reports negatively in the short term but can be part of a long-term financial strategy when applied thoughtfully in the context of all the information in your credit reports- Consider the amount of time since your accounts were opened as well as the number of new accounts and recent creditor inquiries. step 7 Set up a Budget mortgage Review two recent SCAM ALERT food If you have to pay a fee for the promise of a loan or credit card, you may be the victim of a scam. pay stubs. and when these activities are undertaken well before you plan to apply for a mortgage or Calculate your monthly income rent Make a list of your fixed expenses other loan. child care Subtract your expenses from your monthly income to determine your discretionary money. expenses utilities and the like After putting money in a rainy day fund, determine how much money you can use each month to increase the payments on your credit cards. Target a large proportion of your credit card payment resources toward cards with the highest balances as a percentage of their credit limits. Consider setting aside some of your discretionary money to build slowly a rainy day fund equal to six to eight months of income that you would use to pay your bills if you lose your job or something unexpected happens in your life. Consider a balance transfer for your highest interest cards if you have not applied for otherforms of new credit or loans recently and in the context of all the information in your credit reports. OLD ACCOUNT NEW ACCOUNT WITH HIGHER BALANCE Don't use credit cards or loans to spend more, than you earn. Sources: O Consumer Financial Protection Bureau O Federal Reserve O Federal Trade Commission O myFICO.com O Experian TM CreditDonkey Annual Credit Health Checkup At the beginning of the year, do a self-assessment of your creditworthiness for the financial challenges you may face. O Credit l'kre-dit O A loan step 1 Pay Your Bills on Time 2 The ability of a person to borrow money 3 Influence or power derived from enjoying the confidence of others Making timely payments is one of the best things you can do for your financial reputation: step 2 Go ahead... step on scale Pay all your bills and catch up on late payments before you do any other work Credit reporting companies gather and sell information about consumers to both lenders and consumers. on your finances. REVIEW YOUR CREDIT REPORTS 30 million Under the Fair and Accurate Credit Transactions Act, you can get one free credit report once every 12 months by request from each of the three nationwide credit reporting companies: SCAM ALERT free credit reports are estimated to be delivered annually to about 15.9 million individual consumers through the authorized Neither the authorized Web site nor the credit reporting EQUIFAX The three nationwide credit reporting companies operate a single Web site for consumers to request free reports - annualcreditreport.com- which is the only authorized companies will call you first to ask for personal information or send you an email asking for personal information. Experian TransUnion Web site. You may order reports from each of the three consumer reporting companies at the same time, or stagger them. online source for free credit reports. FICO SCORE The Fair Isaac A 850 Corporation E Excellent calculates | Lenders determine your creditworthiness based on their own interpretations of all the information available to them, including the information in one or more credit reports. HOW DOES INFORMATION the most ABOUT YOU AFFECT widely used and familiar A FICO SCORE? 700 type of credit score known Lenders use credit scores to assess the risk a potential borrower will not repay a loan. CREDIT SCORING as a FICO Credit scoring is a type of calculation applied to factors in your credit history that measures your likelihood to pay your debt. score. Scores range from 300 30% Amounts 35% Payment history 550 owed to 850, with lower-risk (more responsible) Consumers do not have one single numerical score that is used by all credit reporting companies and all lenders for all purposes because there are many scoring methods and score ranges used. 400 borrowers on the upper end. 300 Financially Dead 10% New credit 15% Many of the scores calculated for and used by lenders are not available to consumers. Credit scores influence Length of credit history 10% Турes of credit used the marketing offers consumers receive. Credit scores can affect account-management decisions, such as changing credit limits or changing interest rates. U.S.Cities with the MN I ME NH VT G NY I IMA I RI PA CT IL 8 IN OHIIIIIIIIIII II---DQMD NJ -I-IwV VA DE III I I Highest Credit Scores Average scores 1 Wausau, Wis. 789 ORIIII MI 2 Minneapolis, Minn. 787 3 Madison, Wis. 785 4 Cedar Rapids, lowa 781 .... ARI TN II-- NCIIII MS AL GA SC 5 San Francisco, Calif. 781 6 Green Bay, Wis. 780 a 542 6H 7 Boston, Mass. ILA I- FLIII- 3 779 AK I 10 Peoria, I. 778 Sioux Falls, S.D. 778 HIII La Crosse, Wis. 777 1 Harlingen, Texas 686 4 Monroe, La. 706 7 Bakersfield, Calif. 709 Jackson, Miss. 701 Shreveport, La. 706 8 Las Vegas, Nev. 709 U.S. Cities with the Lowest Credit Scores Corpus Christi, Texas 702 6 Augusta, Ga. 709 9 Tyler, Texas 710 10 El Paso, Texas 710 Source: Experian analysis based on average VantageScore (range from 501 to 990) by DMA from January through June 2011 Understand step 3 that all lenders do not necessarily report to all 3 credit reporting companies, so errors may Look for Errors on Credit Reports Compare credit appear on one report but not on others. reports to your account statements. Look for evidence of identity theft or activity that is not Realize that yours. your credit scores are likely to be different on different reports based on variable calculation Scrutinize accounts described by any terms other than "current" methods and differences in the data available on the calculation or "paid as agreed." date. CORRECT ERRORS .... Credit reporting companies must investigate unless they consider a dispute frivolous. Contact in writing Contact in writing Provide copies of any documents that support the credit reporting company that provided the report. the company or person who provided the disputed information. your assertion. step 4 Review Your Payment History A credit reporting company can rерort most types of derogatory information Accurate negative Late payments and past due amounts weigh heavily on your credit reputation. information for 7 years and can only be removed bankruptcy information for 10 years. with the passage of time. Take time step 5 Review Your Balances to consider the things creditors look at: How recently have you made late payments? A Have you made one or a few late payments because you were absentminded? Review the total amount you owe and the individual balances on various types of accounts-such as credit cards, installment auto loans, and mortgages. How many days past due were your Investigate options for setting up automatic payments. accounts? Consider scheduling e-mail or smartphone reminders. What amount was past due? Consider asking courteously in writing that a lender remove a late payment from your credit report if you otherwise have been a good customer. A lender does not have to grant you this favor, but a good reputation matters. B Do you have significant delinquencies because you are having trouble paying your bills? Were any colle actions taken? Contact your creditors directly, explain your situation and ask if it is possible to reduce your payments to a level you can manage. Think carefully before consolidating credit card debt through a second mortgage or a home equity line of credit, which are now offered at very low rates. Remember that credit card debt Analyze carefully your credit cards with the highest balances, including those with low interest rates, because the proportion of your credit limit used on a credit card, regardless of its interest rate, is a factor in determining your creditworthiness. SCAM ALERT is considered "unsecured debt," while mortgages and home equity loans are "secured debts" that require you to put up your home as collateral. If you can't make the payments on secured loans, you could lose your home. Many predatory companies- even some nonprofits-target consumers who have poor credit histories with promises to clean up their credit reports. The truth is: Credit repair companies and credit counselors cannot remove accurate negative information from your credit report. Consider contacting a reputable credit counseling organization-such as one offered by a university, military base, housing authority, or branches of the U.S. Cooperative Extension Service- if you have trouble sorting through your options. Understand that lowering the balances on any of your credit cards has few downsides. Yet, if you close credit card accounts after paying down your balances, you could increase the ratio of your remaining balances to your total credit limits, which could have an effect on your credit reputation. If You Have Credit Cards in Your Wallet If You Have No Credit Cards Think about Look at the total length of your credit history and compare it to the age of your oldest open credit card. Investigate applying for a low-interest credit card if you do not have any revolving cautiously researching and using a secured Consider balance transfers to cards with lower interest rates only in the full context of all credit the factors in your credit report, including your present credit limits, credit history and any recent credit lines Consider whether your oldest credit card is serving a valuable purpose in your history. Some evidence of responsibly managed credit cards with low card that requires a security deposit by providing a benchmark that shows the longevity of your credit history. Think about keeping (which is different from an upfront fee credit or a stored-value debit card) to build a credit history if you are young or have had credit problems in the past. new account balances can be applications. a good thing. this account open and using it, if sparingly, even if it has a high interest rate. step 6 Review the Length of Your Credit History and Any Recent Applications Understand that any recent activity-such as applying for new credit cards, transferring balances or closing credit card accounts-may affect your credit reports negatively in the short term but can be part of a long-term financial strategy when applied thoughtfully in the context of all the information in your credit reports- Consider the amount of time since your accounts were opened as well as the number of new accounts and recent creditor inquiries. step 7 Set up a Budget mortgage Review two recent SCAM ALERT food If you have to pay a fee for the promise of a loan or credit card, you may be the victim of a scam. pay stubs. and when these activities are undertaken well before you plan to apply for a mortgage or Calculate your monthly income rent Make a list of your fixed expenses other loan. child care Subtract your expenses from your monthly income to determine your discretionary money. expenses utilities and the like After putting money in a rainy day fund, determine how much money you can use each month to increase the payments on your credit cards. Target a large proportion of your credit card payment resources toward cards with the highest balances as a percentage of their credit limits. Consider setting aside some of your discretionary money to build slowly a rainy day fund equal to six to eight months of income that you would use to pay your bills if you lose your job or something unexpected happens in your life. Consider a balance transfer for your highest interest cards if you have not applied for otherforms of new credit or loans recently and in the context of all the information in your credit reports. OLD ACCOUNT NEW ACCOUNT WITH HIGHER BALANCE Don't use credit cards or loans to spend more, than you earn. Sources: O Consumer Financial Protection Bureau O Federal Reserve O Federal Trade Commission O myFICO.com O Experian TM CreditDonkey Annual Credit Health Checkup At the beginning of the year, do a self-assessment of your creditworthiness for the financial challenges you may face. O Credit l'kre-dit O A loan step 1 Pay Your Bills on Time 2 The ability of a person to borrow money 3 Influence or power derived from enjoying the confidence of others Making timely payments is one of the best things you can do for your financial reputation: step 2 Go ahead... step on scale Pay all your bills and catch up on late payments before you do any other work Credit reporting companies gather and sell information about consumers to both lenders and consumers. on your finances. REVIEW YOUR CREDIT REPORTS 30 million Under the Fair and Accurate Credit Transactions Act, you can get one free credit report once every 12 months by request from each of the three nationwide credit reporting companies: SCAM ALERT free credit reports are estimated to be delivered annually to about 15.9 million individual consumers through the authorized Neither the authorized Web site nor the credit reporting EQUIFAX The three nationwide credit reporting companies operate a single Web site for consumers to request free reports - annualcreditreport.com- which is the only authorized companies will call you first to ask for personal information or send you an email asking for personal information. Experian TransUnion Web site. You may order reports from each of the three consumer reporting companies at the same time, or stagger them. online source for free credit reports. FICO SCORE The Fair Isaac A 850 Corporation E Excellent calculates | Lenders determine your creditworthiness based on their own interpretations of all the information available to them, including the information in one or more credit reports. HOW DOES INFORMATION the most ABOUT YOU AFFECT widely used and familiar A FICO SCORE? 700 type of credit score known Lenders use credit scores to assess the risk a potential borrower will not repay a loan. CREDIT SCORING as a FICO Credit scoring is a type of calculation applied to factors in your credit history that measures your likelihood to pay your debt. score. Scores range from 300 30% Amounts 35% Payment history 550 owed to 850, with lower-risk (more responsible) Consumers do not have one single numerical score that is used by all credit reporting companies and all lenders for all purposes because there are many scoring methods and score ranges used. 400 borrowers on the upper end. 300 Financially Dead 10% New credit 15% Many of the scores calculated for and used by lenders are not available to consumers. Credit scores influence Length of credit history 10% Турes of credit used the marketing offers consumers receive. Credit scores can affect account-management decisions, such as changing credit limits or changing interest rates. U.S.Cities with the MN I ME NH VT G NY I IMA I RI PA CT IL 8 IN OHIIIIIIIIIII II---DQMD NJ -I-IwV VA DE III I I Highest Credit Scores Average scores 1 Wausau, Wis. 789 ORIIII MI 2 Minneapolis, Minn. 787 3 Madison, Wis. 785 4 Cedar Rapids, lowa 781 .... ARI TN II-- NCIIII MS AL GA SC 5 San Francisco, Calif. 781 6 Green Bay, Wis. 780 a 542 6H 7 Boston, Mass. ILA I- FLIII- 3 779 AK I 10 Peoria, I. 778 Sioux Falls, S.D. 778 HIII La Crosse, Wis. 777 1 Harlingen, Texas 686 4 Monroe, La. 706 7 Bakersfield, Calif. 709 Jackson, Miss. 701 Shreveport, La. 706 8 Las Vegas, Nev. 709 U.S. Cities with the Lowest Credit Scores Corpus Christi, Texas 702 6 Augusta, Ga. 709 9 Tyler, Texas 710 10 El Paso, Texas 710 Source: Experian analysis based on average VantageScore (range from 501 to 990) by DMA from January through June 2011 Understand step 3 that all lenders do not necessarily report to all 3 credit reporting companies, so errors may Look for Errors on Credit Reports Compare credit appear on one report but not on others. reports to your account statements. Look for evidence of identity theft or activity that is not Realize that yours. your credit scores are likely to be different on different reports based on variable calculation Scrutinize accounts described by any terms other than "current" methods and differences in the data available on the calculation or "paid as agreed." date. CORRECT ERRORS .... Credit reporting companies must investigate unless they consider a dispute frivolous. Contact in writing Contact in writing Provide copies of any documents that support the credit reporting company that provided the report. the company or person who provided the disputed information. your assertion. step 4 Review Your Payment History A credit reporting company can rерort most types of derogatory information Accurate negative Late payments and past due amounts weigh heavily on your credit reputation. information for 7 years and can only be removed bankruptcy information for 10 years. with the passage of time. Take time step 5 Review Your Balances to consider the things creditors look at: How recently have you made late payments? A Have you made one or a few late payments because you were absentminded? Review the total amount you owe and the individual balances on various types of accounts-such as credit cards, installment auto loans, and mortgages. How many days past due were your Investigate options for setting up automatic payments. accounts? Consider scheduling e-mail or smartphone reminders. What amount was past due? Consider asking courteously in writing that a lender remove a late payment from your credit report if you otherwise have been a good customer. A lender does not have to grant you this favor, but a good reputation matters. B Do you have significant delinquencies because you are having trouble paying your bills? Were any colle actions taken? Contact your creditors directly, explain your situation and ask if it is possible to reduce your payments to a level you can manage. Think carefully before consolidating credit card debt through a second mortgage or a home equity line of credit, which are now offered at very low rates. Remember that credit card debt Analyze carefully your credit cards with the highest balances, including those with low interest rates, because the proportion of your credit limit used on a credit card, regardless of its interest rate, is a factor in determining your creditworthiness. SCAM ALERT is considered "unsecured debt," while mortgages and home equity loans are "secured debts" that require you to put up your home as collateral. If you can't make the payments on secured loans, you could lose your home. Many predatory companies- even some nonprofits-target consumers who have poor credit histories with promises to clean up their credit reports. The truth is: Credit repair companies and credit counselors cannot remove accurate negative information from your credit report. Consider contacting a reputable credit counseling organization-such as one offered by a university, military base, housing authority, or branches of the U.S. Cooperative Extension Service- if you have trouble sorting through your options. Understand that lowering the balances on any of your credit cards has few downsides. Yet, if you close credit card accounts after paying down your balances, you could increase the ratio of your remaining balances to your total credit limits, which could have an effect on your credit reputation. If You Have Credit Cards in Your Wallet If You Have No Credit Cards Think about Look at the total length of your credit history and compare it to the age of your oldest open credit card. Investigate applying for a low-interest credit card if you do not have any revolving cautiously researching and using a secured Consider balance transfers to cards with lower interest rates only in the full context of all credit the factors in your credit report, including your present credit limits, credit history and any recent credit lines Consider whether your oldest credit card is serving a valuable purpose in your history. Some evidence of responsibly managed credit cards with low card that requires a security deposit by providing a benchmark that shows the longevity of your credit history. Think about keeping (which is different from an upfront fee credit or a stored-value debit card) to build a credit history if you are young or have had credit problems in the past. new account balances can be applications. a good thing. this account open and using it, if sparingly, even if it has a high interest rate. step 6 Review the Length of Your Credit History and Any Recent Applications Understand that any recent activity-such as applying for new credit cards, transferring balances or closing credit card accounts-may affect your credit reports negatively in the short term but can be part of a long-term financial strategy when applied thoughtfully in the context of all the information in your credit reports- Consider the amount of time since your accounts were opened as well as the number of new accounts and recent creditor inquiries. step 7 Set up a Budget mortgage Review two recent SCAM ALERT food If you have to pay a fee for the promise of a loan or credit card, you may be the victim of a scam. pay stubs. and when these activities are undertaken well before you plan to apply for a mortgage or Calculate your monthly income rent Make a list of your fixed expenses other loan. child care Subtract your expenses from your monthly income to determine your discretionary money. expenses utilities and the like After putting money in a rainy day fund, determine how much money you can use each month to increase the payments on your credit cards. Target a large proportion of your credit card payment resources toward cards with the highest balances as a percentage of their credit limits. Consider setting aside some of your discretionary money to build slowly a rainy day fund equal to six to eight months of income that you would use to pay your bills if you lose your job or something unexpected happens in your life. Consider a balance transfer for your highest interest cards if you have not applied for otherforms of new credit or loans recently and in the context of all the information in your credit reports. OLD ACCOUNT NEW ACCOUNT WITH HIGHER BALANCE Don't use credit cards or loans to spend more, than you earn. Sources: O Consumer Financial Protection Bureau O Federal Reserve O Federal Trade Commission O myFICO.com O Experian TM CreditDonkey Annual Credit Health Checkup At the beginning of the year, do a self-assessment of your creditworthiness for the financial challenges you may face. O Credit l'kre-dit O A loan step 1 Pay Your Bills on Time 2 The ability of a person to borrow money 3 Influence or power derived from enjoying the confidence of others Making timely payments is one of the best things you can do for your financial reputation: step 2 Go ahead... step on scale Pay all your bills and catch up on late payments before you do any other work Credit reporting companies gather and sell information about consumers to both lenders and consumers. on your finances. REVIEW YOUR CREDIT REPORTS 30 million Under the Fair and Accurate Credit Transactions Act, you can get one free credit report once every 12 months by request from each of the three nationwide credit reporting companies: SCAM ALERT free credit reports are estimated to be delivered annually to about 15.9 million individual consumers through the authorized Neither the authorized Web site nor the credit reporting EQUIFAX The three nationwide credit reporting companies operate a single Web site for consumers to request free reports - annualcreditreport.com- which is the only authorized companies will call you first to ask for personal information or send you an email asking for personal information. Experian TransUnion Web site. You may order reports from each of the three consumer reporting companies at the same time, or stagger them. online source for free credit reports. FICO SCORE The Fair Isaac A 850 Corporation E Excellent calculates | Lenders determine your creditworthiness based on their own interpretations of all the information available to them, including the information in one or more credit reports. HOW DOES INFORMATION the most ABOUT YOU AFFECT widely used and familiar A FICO SCORE? 700 type of credit score known Lenders use credit scores to assess the risk a potential borrower will not repay a loan. CREDIT SCORING as a FICO Credit scoring is a type of calculation applied to factors in your credit history that measures your likelihood to pay your debt. score. Scores range from 300 30% Amounts 35% Payment history 550 owed to 850, with lower-risk (more responsible) Consumers do not have one single numerical score that is used by all credit reporting companies and all lenders for all purposes because there are many scoring methods and score ranges used. 400 borrowers on the upper end. 300 Financially Dead 10% New credit 15% Many of the scores calculated for and used by lenders are not available to consumers. Credit scores influence Length of credit history 10% Турes of credit used the marketing offers consumers receive. Credit scores can affect account-management decisions, such as changing credit limits or changing interest rates. U.S.Cities with the MN I ME NH VT G NY I IMA I RI PA CT IL 8 IN OHIIIIIIIIIII II---DQMD NJ -I-IwV VA DE III I I Highest Credit Scores Average scores 1 Wausau, Wis. 789 ORIIII MI 2 Minneapolis, Minn. 787 3 Madison, Wis. 785 4 Cedar Rapids, lowa 781 .... ARI TN II-- NCIIII MS AL GA SC 5 San Francisco, Calif. 781 6 Green Bay, Wis. 780 a 542 6H 7 Boston, Mass. ILA I- FLIII- 3 779 AK I 10 Peoria, I. 778 Sioux Falls, S.D. 778 HIII La Crosse, Wis. 777 1 Harlingen, Texas 686 4 Monroe, La. 706 7 Bakersfield, Calif. 709 Jackson, Miss. 701 Shreveport, La. 706 8 Las Vegas, Nev. 709 U.S. Cities with the Lowest Credit Scores Corpus Christi, Texas 702 6 Augusta, Ga. 709 9 Tyler, Texas 710 10 El Paso, Texas 710 Source: Experian analysis based on average VantageScore (range from 501 to 990) by DMA from January through June 2011 Understand step 3 that all lenders do not necessarily report to all 3 credit reporting companies, so errors may Look for Errors on Credit Reports Compare credit appear on one report but not on others. reports to your account statements. Look for evidence of identity theft or activity that is not Realize that yours. your credit scores are likely to be different on different reports based on variable calculation Scrutinize accounts described by any terms other than "current" methods and differences in the data available on the calculation or "paid as agreed." date. CORRECT ERRORS .... Credit reporting companies must investigate unless they consider a dispute frivolous. Contact in writing Contact in writing Provide copies of any documents that support the credit reporting company that provided the report. the company or person who provided the disputed information. your assertion. step 4 Review Your Payment History A credit reporting company can rерort most types of derogatory information Accurate negative Late payments and past due amounts weigh heavily on your credit reputation. information for 7 years and can only be removed bankruptcy information for 10 years. with the passage of time. Take time step 5 Review Your Balances to consider the things creditors look at: How recently have you made late payments? A Have you made one or a few late payments because you were absentminded? Review the total amount you owe and the individual balances on various types of accounts-such as credit cards, installment auto loans, and mortgages. How many days past due were your Investigate options for setting up automatic payments. accounts? Consider scheduling e-mail or smartphone reminders. What amount was past due? Consider asking courteously in writing that a lender remove a late payment from your credit report if you otherwise have been a good customer. A lender does not have to grant you this favor, but a good reputation matters. B Do you have significant delinquencies because you are having trouble paying your bills? Were any colle actions taken? Contact your creditors directly, explain your situation and ask if it is possible to reduce your payments to a level you can manage. Think carefully before consolidating credit card debt through a second mortgage or a home equity line of credit, which are now offered at very low rates. Remember that credit card debt Analyze carefully your credit cards with the highest balances, including those with low interest rates, because the proportion of your credit limit used on a credit card, regardless of its interest rate, is a factor in determining your creditworthiness. SCAM ALERT is considered "unsecured debt," while mortgages and home equity loans are "secured debts" that require you to put up your home as collateral. If you can't make the payments on secured loans, you could lose your home. Many predatory companies- even some nonprofits-target consumers who have poor credit histories with promises to clean up their credit reports. The truth is: Credit repair companies and credit counselors cannot remove accurate negative information from your credit report. Consider contacting a reputable credit counseling organization-such as one offered by a university, military base, housing authority, or branches of the U.S. Cooperative Extension Service- if you have trouble sorting through your options. Understand that lowering the balances on any of your credit cards has few downsides. Yet, if you close credit card accounts after paying down your balances, you could increase the ratio of your remaining balances to your total credit limits, which could have an effect on your credit reputation. If You Have Credit Cards in Your Wallet If You Have No Credit Cards Think about Look at the total length of your credit history and compare it to the age of your oldest open credit card. Investigate applying for a low-interest credit card if you do not have any revolving cautiously researching and using a secured Consider balance transfers to cards with lower interest rates only in the full context of all credit the factors in your credit report, including your present credit limits, credit history and any recent credit lines Consider whether your oldest credit card is serving a valuable purpose in your history. Some evidence of responsibly managed credit cards with low card that requires a security deposit by providing a benchmark that shows the longevity of your credit history. Think about keeping (which is different from an upfront fee credit or a stored-value debit card) to build a credit history if you are young or have had credit problems in the past. new account balances can be applications. a good thing. this account open and using it, if sparingly, even if it has a high interest rate. step 6 Review the Length of Your Credit History and Any Recent Applications Understand that any recent activity-such as applying for new credit cards, transferring balances or closing credit card accounts-may affect your credit reports negatively in the short term but can be part of a long-term financial strategy when applied thoughtfully in the context of all the information in your credit reports- Consider the amount of time since your accounts were opened as well as the number of new accounts and recent creditor inquiries. step 7 Set up a Budget mortgage Review two recent SCAM ALERT food If you have to pay a fee for the promise of a loan or credit card, you may be the victim of a scam. pay stubs. and when these activities are undertaken well before you plan to apply for a mortgage or Calculate your monthly income rent Make a list of your fixed expenses other loan. child care Subtract your expenses from your monthly income to determine your discretionary money. expenses utilities and the like After putting money in a rainy day fund, determine how much money you can use each month to increase the payments on your credit cards. Target a large proportion of your credit card payment resources toward cards with the highest balances as a percentage of their credit limits. Consider setting aside some of your discretionary money to build slowly a rainy day fund equal to six to eight months of income that you would use to pay your bills if you lose your job or something unexpected happens in your life. Consider a balance transfer for your highest interest cards if you have not applied for otherforms of new credit or loans recently and in the context of all the information in your credit reports. OLD ACCOUNT NEW ACCOUNT WITH HIGHER BALANCE Don't use credit cards or loans to spend more, than you earn. Sources: O Consumer Financial Protection Bureau O Federal Reserve O Federal Trade Commission O myFICO.com O Experian TM CreditDonkey Annual Credit Health Checkup At the beginning of the year, do a self-assessment of your creditworthiness for the financial challenges you may face. O Credit l'kre-dit O A loan step 1 Pay Your Bills on Time 2 The ability of a person to borrow money 3 Influence or power derived from enjoying the confidence of others Making timely payments is one of the best things you can do for your financial reputation: step 2 Go ahead... step on scale Pay all your bills and catch up on late payments before you do any other work Credit reporting companies gather and sell information about consumers to both lenders and consumers. on your finances. REVIEW YOUR CREDIT REPORTS 30 million Under the Fair and Accurate Credit Transactions Act, you can get one free credit report once every 12 months by request from each of the three nationwide credit reporting companies: SCAM ALERT free credit reports are estimated to be delivered annually to about 15.9 million individual consumers through the authorized Neither the authorized Web site nor the credit reporting EQUIFAX The three nationwide credit reporting companies operate a single Web site for consumers to request free reports - annualcreditreport.com- which is the only authorized companies will call you first to ask for personal information or send you an email asking for personal information. Experian TransUnion Web site. You may order reports from each of the three consumer reporting companies at the same time, or stagger them. online source for free credit reports. FICO SCORE The Fair Isaac A 850 Corporation E Excellent calculates | Lenders determine your creditworthiness based on their own interpretations of all the information available to them, including the information in one or more credit reports. HOW DOES INFORMATION the most ABOUT YOU AFFECT widely used and familiar A FICO SCORE? 700 type of credit score known Lenders use credit scores to assess the risk a potential borrower will not repay a loan. CREDIT SCORING as a FICO Credit scoring is a type of calculation applied to factors in your credit history that measures your likelihood to pay your debt. score. Scores range from 300 30% Amounts 35% Payment history 550 owed to 850, with lower-risk (more responsible) Consumers do not have one single numerical score that is used by all credit reporting companies and all lenders for all purposes because there are many scoring methods and score ranges used. 400 borrowers on the upper end. 300 Financially Dead 10% New credit 15% Many of the scores calculated for and used by lenders are not available to consumers. Credit scores influence Length of credit history 10% Турes of credit used the marketing offers consumers receive. Credit scores can affect account-management decisions, such as changing credit limits or changing interest rates. U.S.Cities with the MN I ME NH VT G NY I IMA I RI PA CT IL 8 IN OHIIIIIIIIIII II---DQMD NJ -I-IwV VA DE III I I Highest Credit Scores Average scores 1 Wausau, Wis. 789 ORIIII MI 2 Minneapolis, Minn. 787 3 Madison, Wis. 785 4 Cedar Rapids, lowa 781 .... ARI TN II-- NCIIII MS AL GA SC 5 San Francisco, Calif. 781 6 Green Bay, Wis. 780 a 542 6H 7 Boston, Mass. ILA I- FLIII- 3 779 AK I 10 Peoria, I. 778 Sioux Falls, S.D. 778 HIII La Crosse, Wis. 777 1 Harlingen, Texas 686 4 Monroe, La. 706 7 Bakersfield, Calif. 709 Jackson, Miss. 701 Shreveport, La. 706 8 Las Vegas, Nev. 709 U.S. Cities with the Lowest Credit Scores Corpus Christi, Texas 702 6 Augusta, Ga. 709 9 Tyler, Texas 710 10 El Paso, Texas 710 Source: Experian analysis based on average VantageScore (range from 501 to 990) by DMA from January through June 2011 Understand step 3 that all lenders do not necessarily report to all 3 credit reporting companies, so errors may Look for Errors on Credit Reports Compare credit appear on one report but not on others. reports to your account statements. Look for evidence of identity theft or activity that is not Realize that yours. your credit scores are likely to be different on different reports based on variable calculation Scrutinize accounts described by any terms other than "current" methods and differences in the data available on the calculation or "paid as agreed." date. CORRECT ERRORS .... Credit reporting companies must investigate unless they consider a dispute frivolous. Contact in writing Contact in writing Provide copies of any documents that support the credit reporting company that provided the report. the company or person who provided the disputed information. your assertion. step 4 Review Your Payment History A credit reporting company can rерort most types of derogatory information Accurate negative Late payments and past due amounts weigh heavily on your credit reputation. information for 7 years and can only be removed bankruptcy information for 10 years. with the passage of time. Take time step 5 Review Your Balances to consider the things creditors look at: How recently have you made late payments? A Have you made one or a few late payments because you were absentminded? Review the total amount you owe and the individual balances on various types of accounts-such as credit cards, installment auto loans, and mortgages. How many days past due were your Investigate options for setting up automatic payments. accounts? Consider scheduling e-mail or smartphone reminders. What amount was past due? Consider asking courteously in writing that a lender remove a late payment from your credit report if you otherwise have been a good customer. A lender does not have to grant you this favor, but a good reputation matters. B Do you have significant delinquencies because you are having trouble paying your bills? Were any colle actions taken? Contact your creditors directly, explain your situation and ask if it is possible to reduce your payments to a level you can manage. Think carefully before consolidating credit card debt through a second mortgage or a home equity line of credit, which are now offered at very low rates. Remember that credit card debt Analyze carefully your credit cards with the highest balances, including those with low interest rates, because the proportion of your credit limit used on a credit card, regardless of its interest rate, is a factor in determining your creditworthiness. SCAM ALERT is considered "unsecured debt," while mortgages and home equity loans are "secured debts" that require you to put up your home as collateral. If you can't make the payments on secured loans, you could lose your home. Many predatory companies- even some nonprofits-target consumers who have poor credit histories with promises to clean up their credit reports. The truth is: Credit repair companies and credit counselors cannot remove accurate negative information from your credit report. Consider contacting a reputable credit counseling organization-such as one offered by a university, military base, housing authority, or branches of the U.S. Cooperative Extension Service- if you have trouble sorting through your options. Understand that lowering the balances on any of your credit cards has few downsides. Yet, if you close credit card accounts after paying down your balances, you could increase the ratio of your remaining balances to your total credit limits, which could have an effect on your credit reputation. If You Have Credit Cards in Your Wallet If You Have No Credit Cards Think about Look at the total length of your credit history and compare it to the age of your oldest open credit card. Investigate applying for a low-interest credit card if you do not have any revolving cautiously researching and using a secured Consider balance transfers to cards with lower interest rates only in the full context of all credit the factors in your credit report, including your present credit limits, credit history and any recent credit lines Consider whether your oldest credit card is serving a valuable purpose in your history. Some evidence of responsibly managed credit cards with low card that requires a security deposit by providing a benchmark that shows the longevity of your credit history. Think about keeping (which is different from an upfront fee credit or a stored-value debit card) to build a credit history if you are young or have had credit problems in the past. new account balances can be applications. a good thing. this account open and using it, if sparingly, even if it has a high interest rate. step 6 Review the Length of Your Credit History and Any Recent Applications Understand that any recent activity-such as applying for new credit cards, transferring balances or closing credit card accounts-may affect your credit reports negatively in the short term but can be part of a long-term financial strategy when applied thoughtfully in the context of all the information in your credit reports- Consider the amount of time since your accounts were opened as well as the number of new accounts and recent creditor inquiries. step 7 Set up a Budget mortgage Review two recent SCAM ALERT food If you have to pay a fee for the promise of a loan or credit card, you may be the victim of a scam. pay stubs. and when these activities are undertaken well before you plan to apply for a mortgage or Calculate your monthly income rent Make a list of your fixed expenses other loan. child care Subtract your expenses from your monthly income to determine your discretionary money. expenses utilities and the like After putting money in a rainy day fund, determine how much money you can use each month to increase the payments on your credit cards. Target a large proportion of your credit card payment resources toward cards with the highest balances as a percentage of their credit limits. Consider setting aside some of your discretionary money to build slowly a rainy day fund equal to six to eight months of income that you would use to pay your bills if you lose your job or something unexpected happens in your life. Consider a balance transfer for your highest interest cards if you have not applied for otherforms of new credit or loans recently and in the context of all the information in your credit reports. OLD ACCOUNT NEW ACCOUNT WITH HIGHER BALANCE Don't use credit cards or loans to spend more, than you earn. Sources: O Consumer Financial Protection Bureau O Federal Reserve O Federal Trade Commission O myFICO.com O Experian TM CreditDonkey Annual Credit Health Checkup At the beginning of the year, do a self-assessment of your creditworthiness for the financial challenges you may face. O Credit l'kre-dit O A loan step 1 Pay Your Bills on Time 2 The ability of a person to borrow money 3 Influence or power derived from enjoying the confidence of others Making timely payments is one of the best things you can do for your financial reputation: step 2 Go ahead... step on scale Pay all your bills and catch up on late payments before you do any other work Credit reporting companies gather and sell information about consumers to both lenders and consumers. on your finances. REVIEW YOUR CREDIT REPORTS 30 million Under the Fair and Accurate Credit Transactions Act, you can get one free credit report once every 12 months by request from each of the three nationwide credit reporting companies: SCAM ALERT free credit reports are estimated to be delivered annually to about 15.9 million individual consumers through the authorized Neither the authorized Web site nor the credit reporting EQUIFAX The three nationwide credit reporting companies operate a single Web site for consumers to request free reports - annualcreditreport.com- which is the only authorized companies will call you first to ask for personal information or send you an email asking for personal information. Experian TransUnion Web site. You may order reports from each of the three consumer reporting companies at the same time, or stagger them. online source for free credit reports. FICO SCORE The Fair Isaac A 850 Corporation E Excellent calculates | Lenders determine your creditworthiness based on their own interpretations of all the information available to them, including the information in one or more credit reports. HOW DOES INFORMATION the most ABOUT YOU AFFECT widely used and familiar A FICO SCORE? 700 type of credit score known Lenders use credit scores to assess the risk a potential borrower will not repay a loan. CREDIT SCORING as a FICO Credit scoring is a type of calculation applied to factors in your credit history that measures your likelihood to pay your debt. score. Scores range from 300 30% Amounts 35% Payment history 550 owed to 850, with lower-risk (more responsible) Consumers do not have one single numerical score that is used by all credit reporting companies and all lenders for all purposes because there are many scoring methods and score ranges used. 400 borrowers on the upper end. 300 Financially Dead 10% New credit 15% Many of the scores calculated for and used by lenders are not available to consumers. Credit scores influence Length of credit history 10% Турes of credit used the marketing offers consumers receive. Credit scores can affect account-management decisions, such as changing credit limits or changing interest rates. U.S.Cities with the MN I ME NH VT G NY I IMA I RI PA CT IL 8 IN OHIIIIIIIIIII II---DQMD NJ -I-IwV VA DE III I I Highest Credit Scores Average scores 1 Wausau, Wis. 789 ORIIII MI 2 Minneapolis, Minn. 787 3 Madison, Wis. 785 4 Cedar Rapids, lowa 781 .... ARI TN II-- NCIIII MS AL GA SC 5 San Francisco, Calif. 781 6 Green Bay, Wis. 780 a 542 6H 7 Boston, Mass. ILA I- FLIII- 3 779 AK I 10 Peoria, I. 778 Sioux Falls, S.D. 778 HIII La Crosse, Wis. 777 1 Harlingen, Texas 686 4 Monroe, La. 706 7 Bakersfield, Calif. 709 Jackson, Miss. 701 Shreveport, La. 706 8 Las Vegas, Nev. 709 U.S. Cities with the Lowest Credit Scores Corpus Christi, Texas 702 6 Augusta, Ga. 709 9 Tyler, Texas 710 10 El Paso, Texas 710 Source: Experian analysis based on average VantageScore (range from 501 to 990) by DMA from January through June 2011 Understand step 3 that all lenders do not necessarily report to all 3 credit reporting companies, so errors may Look for Errors on Credit Reports Compare credit appear on one report but not on others. reports to your account statements. Look for evidence of identity theft or activity that is not Realize that yours. your credit scores are likely to be different on different reports based on variable calculation Scrutinize accounts described by any terms other than "current" methods and differences in the data available on the calculation or "paid as agreed." date. CORRECT ERRORS .... Credit reporting companies must investigate unless they consider a dispute frivolous. Contact in writing Contact in writing Provide copies of any documents that support the credit reporting company that provided the report. the company or person who provided the disputed information. your assertion. step 4 Review Your Payment History A credit reporting company can rерort most types of derogatory information Accurate negative Late payments and past due amounts weigh heavily on your credit reputation. information for 7 years and can only be removed bankruptcy information for 10 years. with the passage of time. Take time step 5 Review Your Balances to consider the things creditors look at: How recently have you made late payments? A Have you made one or a few late payments because you were absentminded? Review the total amount you owe and the individual balances on various types of accounts-such as credit cards, installment auto loans, and mortgages. How many days past due were your Investigate options for setting up automatic payments. accounts? Consider scheduling e-mail or smartphone reminders. What amount was past due? Consider asking courteously in writing that a lender remove a late payment from your credit report if you otherwise have been a good customer. A lender does not have to grant you this favor, but a good reputation matters. B Do you have significant delinquencies because you are having trouble paying your bills? Were any colle actions taken? Contact your creditors directly, explain your situation and ask if it is possible to reduce your payments to a level you can manage. Think carefully before consolidating credit card debt through a second mortgage or a home equity line of credit, which are now offered at very low rates. Remember that credit card debt Analyze carefully your credit cards with the highest balances, including those with low interest rates, because the proportion of your credit limit used on a credit card, regardless of its interest rate, is a factor in determining your creditworthiness. SCAM ALERT is considered "unsecured debt," while mortgages and home equity loans are "secured debts" that require you to put up your home as collateral. If you can't make the payments on secured loans, you could lose your home. Many predatory companies- even some nonprofits-target consumers who have poor credit histories with promises to clean up their credit reports. The truth is: Credit repair companies and credit counselors cannot remove accurate negative information from your credit report. Consider contacting a reputable credit counseling organization-such as one offered by a university, military base, housing authority, or branches of the U.S. Cooperative Extension Service- if you have trouble sorting through your options. Understand that lowering the balances on any of your credit cards has few downsides. Yet, if you close credit card accounts after paying down your balances, you could increase the ratio of your remaining balances to your total credit limits, which could have an effect on your credit reputation. If You Have Credit Cards in Your Wallet If You Have No Credit Cards Think about Look at the total length of your credit history and compare it to the age of your oldest open credit card. Investigate applying for a low-interest credit card if you do not have any revolving cautiously researching and using a secured Consider balance transfers to cards with lower interest rates only in the full context of all credit the factors in your credit report, including your present credit limits, credit history and any recent credit lines Consider whether your oldest credit card is serving a valuable purpose in your history. Some evidence of responsibly managed credit cards with low card that requires a security deposit by providing a benchmark that shows the longevity of your credit history. Think about keeping (which is different from an upfront fee credit or a stored-value debit card) to build a credit history if you are young or have had credit problems in the past. new account balances can be applications. a good thing. this account open and using it, if sparingly, even if it has a high interest rate. step 6 Review the Length of Your Credit History and Any Recent Applications Understand that any recent activity-such as applying for new credit cards, transferring balances or closing credit card accounts-may affect your credit reports negatively in the short term but can be part of a long-term financial strategy when applied thoughtfully in the context of all the information in your credit reports- Consider the amount of time since your accounts were opened as well as the number of new accounts and recent creditor inquiries. step 7 Set up a Budget mortgage Review two recent SCAM ALERT food If you have to pay a fee for the promise of a loan or credit card, you may be the victim of a scam. pay stubs. and when these activities are undertaken well before you plan to apply for a mortgage or Calculate your monthly income rent Make a list of your fixed expenses other loan. child care Subtract your expenses from your monthly income to determine your discretionary money. expenses utilities and the like After putting money in a rainy day fund, determine how much money you can use each month to increase the payments on your credit cards. Target a large proportion of your credit card payment resources toward cards with the highest balances as a percentage of their credit limits. Consider setting aside some of your discretionary money to build slowly a rainy day fund equal to six to eight months of income that you would use to pay your bills if you lose your job or something unexpected happens in your life. Consider a balance transfer for your highest interest cards if you have not applied for otherforms of new credit or loans recently and in the context of all the information in your credit reports. OLD ACCOUNT NEW ACCOUNT WITH HIGHER BALANCE Don't use credit cards or loans to spend more, than you earn. Sources: O Consumer Financial Protection Bureau O Federal Reserve O Federal Trade Commission O myFICO.com O Experian TM CreditDonkey