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On the Road to Better Credit (part 2)

Your credit score is something that is greatly impacted on your spending habits and your ability to manage the funds that are given to you on a borrowing basis. However, you are not the only one in control of the reports made on your credit. Also, you are not the only one who needs the numbers and figures from your credit report. For example, if you are ready to move into your own home, the first thing that homeowners have to provide is information for a credit check. The same goes for anyone who is ready to purchase a new car. The car salesman is going to ask for your information to conduct a credit check. You may not even be aware of the fact that some jobs use your provided information to run a credit check before offering you the job. Many people are aware that credit checks are necessary for most things, but not many are aware of what these companies look at or what these lenders look at when examining credit reports. Keep reading for these secrets to better credit.


The Credit Bureaus Know Everything

Every single move your credit makes is kept on track by the credit bureaus. A secret to better credit is to understand the three credit bureaus and other financial agencies that monitor all other activity that can affect your credit. The three credit bureaus are Equifax, TransUnion, and Experian. Those credit bureaus are typically used to see how worthy you are of receiving any type of credit. Other agencies that are less known keep track of other credit information, like any returned checks or reports of insufficient funds. Another secret to better credit is to request credit reports from these agencies in order to keep up with your own credit score. Sometimes, you financial institute offer these reports and discounted costs or no cost at all. You can request a report for a specific thing or an entire credit report.

The Use of Scorecards

Were you aware that your credit could be placed on a scorecard? Yes, it is true, and sometimes these scorecards could be a hindrance to your good credit. Another secret to better credit is to understand how these scorecards could work to your advantage as well as your disadvantage. For example, if you have just filed for bankruptcy and that is no longer a factor on your credit report, your scorecard will be based on one that is compared to others with poor credit. So, your credit score will be better than those you are being compared to. However, with your credit now in good standings, but that bankruptcy still be present on the report itself, you can possibly be scored with those with good credit, in turn making your credit look poorer than before. Getting back on your feet after bankruptcy is a great thing, but just be aware of the effects it can have on your credit.

What You Don’t Know, the Lender Knows

There are many versions of your credit score that can be produced. Which credit score your potential lender sees depends on the type of credit you are looking to get. Your base credit score may not be enough information for a house loan or a car loan. The secret to better credit when it comes to this situation is to take advantage of the reports that are given if you are ever denied a loan or credit card from a specific agency. If you apply for a credit card and are denied, the company typically sends you a copy of your credit report that was evaluated. If one is not sent to you automatically, you can request it because by law, this information is required to be provided. You can also contact FICO for copies of all reports that are about your credit.

Your Credit Could Require Deposits

Another secret to better credit is realizing that in order to start new services, deposits may be required according to your credit score. Some of these services include phone, cable, lights, and even renting a new home. Deposits are required if you credit history is not so great. Usually, agencies of the sort report to credit bureaus if the account has gone delinquent and have not been paid back at all. If you want to ensure that your credit score does reflect accounts that are in collections or in default, it is best to keep up with the payments when a new service is being rendered in your name.

Bad Credit Could Yield Job Rejection

As if finding a good job is not hard enough in today’s economy, your credit can be another factor in finding a good job. If you do not have good credit, another secret to better credit is to look for jobs that typically do not require credit checks. Credit checks are usually ran for job prospects with financial job titles, top-level positions, or will have the ability to access financial accounts of employees or outside individuals. In some states, there are limits placed on how much credit reports can effect employment. Regardless of the job, you must have given the employer permission to check your credit.

There you have it folks. You now know the secrets to better credit. Now that you are equipped with this knowledge, use it to your advantage and get your credit back in good standings.