HOW TO FIX BRUISED CREDIT
Credit illiteracy is a problem in the United States. The debt load of the American people is at an all time high. Now more than ever, your credit score is a reflection of YOU, and the risk that you pose to creditor, employers, insurers, finance companies etc. Weve evolved into a society that is controlled by credit, and yet many of us dont know how to control our own situation.
A credit profile is compiled of many factors, not the least of which is timely payments to creditors. One 30 day late payment to a creditor can lower your credit score and it can take up to 2 years to recover. Divorce, bankruptcy, identity theft, co-signing, rapid acquisition of credit cards, ands balances near 100% capacity can all have a devastating affect on your credit.
What makes up your credit score?
- 35% = Payment history - how youve paid your bills?
- 30% = Capacity – how many cards do you have, and how many have balances? Are they maxed out or close to it?
- 15% = Length of credit – how long have you been using credit?
- 10% = Accumulation of debt. How many accounts have you opened in the past
- 12-19 months? How many creditors have pulled your credit?
- 10% = Mix of credit – Installment (raises scores), Revolving (lowers scores). Finance companies lower scores quickly.
How to improve your credit:
- Continue to make payments ON TIME
- Pay down credit cards balances to 50% or below the high credit.
- Do not close credit cards
- Limit opening new accounts
- Acquire a solid credit history with years of experience (secured cards)
If you make a mature assessment of what you want and where you are at, and make a serious commitment, you can get yourself back on tract.
