Tuesday, May 6, 2008

Credit score protection issues

Are you looking for another credit card? Make your mind properly. You need to consider your credit score as its important aspect for someone need loans and once it goes down, it's hard to recover.

It's surprising how many people don't know their credit score. Many people just assume they know, but that could get you in to trouble.

Debt collector Mike Nowak says, "Right now, we're at the highest debt I've ever seen in my 20 years." With all that debt, collection agencies might be coming after you. Having an account go into collections affects your credit score. Hold on, that's not the only thing you have to be concerned with.

Brian Holiman, owner of Yuma Mortgage Group says, "how you pay your bills, the type of credit you have, your proportion of your balances to your credit limit, and whether you have any public records, collections, bankruptcy, stuff like that."

Always keep in mind to pay off the dues on time because it’s the important component. Your bill is only considered late if you pay thirty days after the due date. Besides looking at your bills, look at your number of credit cards. "If you have a lot of store accounts it does have a negative effect on you because credit card companies see you as a heavy credit user."

If you want to improve your credit, "the first thing they do is pay off their credit card, but then they close that account thinking that helps." It doesn't help, because you want to have low debt to income ratio. Instead, pay the card off, leave it open, but don't use it.

Another idea to help with credit card debt, take a loan out to pay it all off. Cut up the credit cards. Pay off the loan with a lower interest rate. "Once you establish a plan or get into a re-payment structure the weight of the world is off of you. It's just getting started."

All these points are basically made by keeping the user’s beneficial end and also some of them are recorded while going through general conversation with some debt experts.


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