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Whether you’re buying a home, a car or applying for a credit card, Lenders want to know the risk they’re taking by lending you money. FICO scores are the credit scores used by 90% of the top lenders to determine your credit risk. Your FICO Scores (you have FICO Scores for each of the 3 major bureaus) can affect how much money a lender will lend you and at what terms (interest rate). Higher FICO Scores can often help you qualify for better rates from lenders. This will save you money!

A credit score is a complex mathematical model that evaluates many types of information in a credit file to determine your financial reliability or credit risk; that is, how likely you are to repay a loan and make your loan payments on time. Many factors influence your score, with the two most important being how you pay your debts and how much debt you owe. For example, late payments on loans, a past bankruptcy, debt collections or a court judgment ordering you to pay money as a result of a lawsuit will negatively affect your credit score. 

credit-scoreFICO scores range from 300 to 850. Any score above 760 is considered perfect. From 700 to 759 is considered good. Less than 700 needs work to achieve this number. Understanding what is included within your credit score is the key. According to the Fair Isaac Corporation that calculates the popular 
“FICO score”, the following factors (and weighting) determine your credit score.

Payment History (35%) which includes account payment information, bankruptcy or judgments, how long overdue payments are, amount past due, and the time since any adverse occurrences.
Amounts Owed (30%) which includes the amounts owed on accounts individually and totaled together as a whole, number of accounts with balances, the proportion of credit line used and proportion of installment loan amounts still owed. 

Length of Credit History (15%) which includes the time since your accounts have been open as well as the time since your accounts were opened. 

New Credit (10%), which includes the number of and time since recently opened accounts and proportion to total accounts, number of and time since recent credit inquiries, and the re-establishment of positive credit history following past payment problems. 

Types of Credit Used (10%) which includes the number of various types of accounts, like credit cards, retail accounts, installment loans, mortgage, etc. 

credit-score-chartCredit scores change over time to accurately reflect your current financial behavior and length of credit history. Accurate negative information can be reported for 7 years, with the exceptions of bankruptcy (10 years), lawsuits or judgments (7 years or until the statute of limitations runs out, whichever is longer), or information based on an application for a job with a salary of more than $20,000 (no time limitation). Since your credit score is a “snapshot”, it’s unlikely that your credit score a month ago is the same as it is today. 

In order to ensure that credit reports are fair for everyone, certain factors are not included in your score. To name just a few, race, religion, national origin, sex, age, salary, and any other information not proven to be predictive of future credit performance are never included in calculating your score.

Is it possible to get a perfect credit score?

I received a text yesterday, asking me if 829 was a good credit score, 839 is the highest I have ever seen or heard a FICO score rising too. So I got to wondering if it is possible to have a perfect credit score of 850.

Good_Will_Hunting_057Getting an 850 FICO credit score is the grown-up version of a perfect SAT score. It’s a personal finance milestone and helps fuel demand for credit score monitoring services and credit score estimators. Other than bragging rights, the effort to attain perfection is unnecessary for finances — and possibly futile.

No lender distinguishes between 760 and 850, for example, and the accomplishment is fleeting. Unlike an exam that is scored once, a credit score is calculated anew each time a request is made and reflects changes on your credit report, which is continually updated. Even if you got an 850, there’s no guarantee you would stay there. You can’t just ring the bell and say, ‘I got it’ because it could change this afternoon.

On there is a survey of a dozen mortgage professionals that yielded no stories of the perfect score. They have never seen it. This made me wonder if it was even possible to achieve. The clear answer is no. So concentrate on 760 or better and don’t stress about being perfect.

Credit Repair

You see the ads in newspapers, on TV, and online and hear them on the radio. You get fliers in the mail, email messages, and maybe even calls offering credit repair services. They all make the same claims:

“Credit problems? No problem!”

“We can remove bankruptcies, judgments, liens, and bad loans from your credit file forever!”

“We can erase your bad credit — 100% guaranteed.”

“Create a new credit identity — legally.”

2720239113fc3a4f09bcbDo yourself a favor and save some money, too. Don’t believe these claims: they’re very likely signs of a scam. Indeed, attorneys at the Federal Trade Commission, the nation’s consumer protection agency, say they’ve never seen a legitimate credit repair operation making those claims. The fact is there’s no quick fix for creditworthiness. You can’t repair the truth. You can improve your credit report legitimately, but it takes time, a conscious effort, and sticking to a personal debt repayment plan.




Credit Disputes

Credit reporting agencies, on an occasion, may miss report an item to your credit report. This usually happens when you have the same name as a sibling or a computer glitch catches the social security number wrong. These mistakes can be removed from your credit report.

BoxingglovesDisputeUsing will help you keep control of your accurate information. You can pull each report one time a year for free. Since there are three different reporting services, we recommend pulling one of the credit reports every four months. Review the report for accuracy. If something is amiss, you can dispute the item through If the item has been missed reported, the credit reporting agencies will update the report.

Please keep in mind, the Credit Report Agencies will investigate the dispute. This keeps accurate information from leaving your credit report. So for example, you had a credit card that was paid back poorly. You try to dispute this card to have the item removed or report as “paid as agreed”, is impossible these days. All accurate Information will remain on your credit report for 7 years. A Bankruptcy will remain for 10 years. So please do not fall for any advertising that this can be done. It’s just not true.

Credit Monitoring

 Along with, we recommend using to obtain your credit scores. This is an absolutely free service. also breaks your score down and explains why the number is where it is and gives advice on how to improve your score. Pull your credit report every four months and check your score monthly. This is the best way to monitor your credit reports and scores for free.

A National Dilemma

Credit reports can be valuable sources of information for consumers. A Consumer with an accurate perception of his or her credit standing may be better equipped to shop for favorable credit items. Also, consumers who view their credit reports can identify potential errors in a credit file and obtain corrections, which may improve their credit standing.

downloadAlthough there are benefits to checking one’s credit report, many consumers do not take advantage of free annual credit reports. The Bureau has estimated that 15.9 million “credit active adults” receive a free credit report from one or more of the three credit bureaus, through each year. This means that roughly 90% of the eligible population does not take advantage of this free benefit. Even stranger is that 26 million consumers buy or receive credit reports from commercial credit monitoring services when it could have been free.

I can’t stress enough how important credit monitoring is. You must keep on top of your credit rating. offers free credit report reviews and education to help you maximize your score. For help, please don’t hesitate; call 888-767-9155 today.

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A Debt Coach Credit Counseling Service. 888-767-9155,