The current FICO credit scoring reflects a new era of very nervous lenders. In 2008, a FICO credit score of 650 a golden ticket to cheap finance rates to purchase a car purchase was a house or get a low-interest credit card. Not anymore.
Although historically the economic markets tank and boom, consumers, some with personal finances are always exciting ride the economic roller coaster with confidence because they know that there is a short and fast ride, that theysurvive.
In 2009, when the credit markets frozen and drained the economy of consumers with a maximum of 650 FICO score doors began to shut, if they are used for loans. The new FICO scoring model calmly to the minimum FICO score that lenders see is safe at 750 or higher. My wife and I were at 820, if this is done the conversion have virtually no effect on us.
It was summed up by Todd Huettner, owner of Denver-based financial companiesHuettner Capital. Talking about the economy on Fox News said: "What used to be called as good credit no more than good enough. A few months ago there was no difference between a score of 620 or 820 for most loans."
How can immune to this economic boom and bust times?
Here are a few tips to help more than any other, significantly increase your credit score and place you in a group of consumers who never worried about getting credit in the hardHours:
1) The first may surprise you: you pay your bills well before the due date.
One of the best ways that we have found dramatically improve your credit score, is not easy to pay your bills on time, it is to pay them within a few days after receiving the mail. This is absurd powerful because each lender will be impressed and will be happy to give you even more if you need it. By the way, contain them your bills, because they pursued by the institutionOffices. We finished the year and we are of modest financial means.
Why do this? Up to 35% of your FICO credit score, how fast your pay back what you owe is based. Reflect your credit report "will be paid as agreed," but lenders will know how quickly you pay your bills.
2. Do not go on loan to their limit or more credit than you need.
To increase your credit score, avoid excessive credit. You should only use one or two credit cards and have only one or two other large debts. These debts are like a car loan or home mortgage. Watch your debt, you are sure you have the best credit.
Are not trying to create a new credit line or credit card only applies to loans made available in an emergency have. Borrow only when you need it and make sure to make the payments as soon as the bill comes.
Many people do not know that the application can be used for many debts in a relatively short period of your> FICO credit score plunge, and it appears that the lender you are financially irresponsible.
3. Stop emergence of new debt and start paying your current debt.
Pay your debts, so you do not exceed 50% of available credit. For example, if your credit card, a credit limit of $ 5,000 to pay the balance to $ 2500 or less, and avoid pushing the balance again.
If possible, reduce the debt to zero per month. If you pay off your credit cardin full each month, that the way to go. It's what we do. We make sure we have zero balances on two credit cards we use, because hate to be honest, we pay interest! We did not pay a penny in interest over 13 years!
What matters is how much of your credit limit is still open - the fewer the better.
3. Mix the types of credit you have.
The types of debts that you are also a factor in calculating your FICO credit score. In general,Lenders like to see that you are able to handle well a diverse range of credit types. This mixture contains a form of personal credit such as credit card numbers, and some larger types of loans like a mortgage or car loan. Such a mix is better than just one type of credit.
Let me conclude with some confidence. We consider these tips (and others) on our FICO score from 810 to 830, which represents us in the top 2% of the consumers. We have a modestIncome. I am retired and my wife is a medical billing clerk. Nevertheless, we are still able to take a nice vacation each year, from credit and fully paid, if we funded the bill. In 2009 we took our two grandchildren and their parents to Disney World for one week. Sweet.
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