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Heidi556

Notes to maximise your credit score

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I am reading much about financial considerations, and your credit score is important. I am studying this from outside, and have no practical experience, as I am preparing to emigrate to the US. Here are some notes I collected regarding managing your credit score, please add and comment.

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Notes to maximise credit score

 

Three credit reporting companies: Equifax, Experian, Transunion.

You are entitled to one free credit report from each of the three above per year.

Credit score calculated from credit report.

Systems; FICO, VantageScore, …

Credit score = A number of 300 – 850, reflection of ability to repay debt.

 

Pay debt on time, every time.

Debt ratio: Utilization rate < 30%, < 10% better, < 7% best, do not get close to limit.

Old debts: Leave long history old debts (study load) on before paying it off too soon = good history.

Get a credit card, secured if needed, fastest way to build score.

Score boosting: Experian Boost allows access to other financial information payment history like utilities and phone lines to factor in to your credit score. UltraFICO allows access to your other banking data. 

Timing of applications: Research likelihood of approval for credit before applying, don’t want to be denied. A hard enquiry can lower score. 

Vehicle finance: Don’t let them run your ???

Dispute errors on credit report.

Pay your credit card twice a month rather than once; two smaller mountains rather than one big one.

Make payment reminders; diarize.

 

35% = Payment history :. Pay on time continuously.

30% = Amount owed :. Keen debt ratio’s low.

15% = Length of credit history.

10% = Number of credit accounts held or applied for.

10% = Mix of type of credit (mortgage, credit card, installments).

 

Sources:

https://www.bankrate.com/finance/debt/7-simple-ways-improve-credit-score-1.aspx

https://www.annualcreditreport.com/yourRights.action

https://www.myfico.com/credit-education/improve-your-credit-score

https://www.bills.com/credit/credit-score/minimum-credit-score

 

Edited by Heidi556

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Creditkarma is quite a helpful site too.

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SJ272, I am a longtime user of CreditKarma. and found it very useful to monitor & build my credit score and also for filing tax returns - all at no charge!

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On 4/2/2019 at 8:09 PM, SJ272 said:

Creditkarma is quite a helpful site too.

Super useful for monitoring your score and getting free credit reports. Have used it for years

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23 hours ago, Superkruz said:

SJ272, I am a longtime user of CreditKarma. and found it very useful to monitor & build my credit score and also for filing tax returns - all at no charge!

Didn't realize you could file tax returns on the site too!  Good to know.

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One of the things I did to improve my credit score was to look at the credit card recommendations on CreditKarma. I would then select the cards with no annual fee, a sign-up bonus and applied for it via site. Approval took less than a minute and the card arrived in the mail a couple of days later. By using the new card for a month or two (and spending a few hundred dollars) I would then get $100 or $150 as a statement credit (the sign-up bonus). I did this many times and saved about $1000 this way. I am now sitting with a fistful of no-fee credit cards that I hardly use and a handy credit score. 

Edited by Superkruz

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We found the anxiety over credit scores a little overblown tbh. 2 credit cards each (paid down at least 80% every month but more usually paid in full, creditkarma helps you keep track of how your balances affect your score) and a car loan with both our names on it, and we had scores around the mid 700s within a year or 18 months, I don’t recall exactly but not longer than that. It’s not the top score, but it’s good enough for anything you need. 

Edited by SJ272

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