How Does Credit Counseling Affect My Credit Score?

21 Jun 2011 | by Billy Miller | No Comments »

When you contact a consumer credit counseling service or undergo a debt management plan, this action does not negatively impact your credit score.  At one time it did, but FICO made changes years ago to their scores, which was an advantage to consumers. Bankruptcy laws require individuals filing for bankruptcy to undergo credit counseling within 180 days of filing for bankruptcy. Credit counseling is considered a positive move to take care of your debt instead of filing for bankruptcy.  The creditors have a better chance of getting some money if you contact to a credit counselor.

Your current and past credit behavior harms your credit score.  If you are considering contacting a consumer credit counselor, you probably have somewhat poor credit already.  If the credit counselor negotiates with lenders for amounts less than you owe, it will be reported as a settlement. Thi

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Tags: Credit Counseling Credit Score Score

Your Credit Card Application has been Rejected: Now What?

21 Jun 2011 | by Mildred Matthews | No Comments »

You may be quite surprised to find that your latest credit card application was rejected. Ouch!

After licking your wounds, there are a number of things you can and should do following a credit card rejection:

  • Even if you applied online or via phone for a credit card, you will receive a written notice in the mail regarding your rejection. It is important to read this letter so you can gain some insight regarding your reason for rejection. If the letter does not give you the answers you are looking for, you should contact the credit card company directly and ask them for a more detailed explanation. After all, you cannot change or improve things if you don’t know what to change.

  • You are entitled to a free copy of your credit report once a year; and again if you are rejected for a credit card offer. I

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Tags: Card Application Credit Card Credit Card Application Rejected

The Effects of the FICO® 8 Credit Score

20 Jun 2011 | by Billy Miller | No Comments »

Most lenders use the Fair Isaac & Company credit score (FICO) to determine consumer credit risk. While the goal of any credit scoring model is to gauge potential risk of default, FICO continues to make adjustments to their formula to best meet those ends in an every changing financial industry. The latest formula, FICO 8, debuted in 2009 as an enhanced protocol to better predict credit risk by keeping pace with changing consumer credit behavior.

All credit scoring protocols take specific credit behaviors and summarize them into a number that others can use to judge the financial risk you present. By changing the level of importance given to some of these behaviors, the score will be more reliable and accurate.

It has taken some lenders more than two years to implement. Citi Cards, for example, recently announced that they will soon be using the new model.

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Tags: Credit Score Score

Serious About Paying Down Your Credit Card Debt? Tips for Reducing that Debt Today

20 Jun 2011 | by Mildred Matthews | No Comments »

CreditCards.com spells out the grim truth: the average credit card debt of an American household is a whopping $14,743. This level of debt can be incredibly overwhelming for any family to tackle, and many families therefore do very little to attack the debt head-on and reduce it. After all, paying down that level of debt can take years to pay off.

However, if you are serious about paying down your credit card debt, there are a few major steps you can take to accomplish this. Here’s what you need to do to tackle that credit card debt today:

  1. Gather your debts and total them up. Your total credit card debt may be quite a bit more than you previous thought, especially if it is spread out over a number of credit cards. Don’t round totals or ignore even the smallest debt; total it all up, down to the penny, so you can get an accurate picture of your current debt load.

  2. Talk about the debt together as a family. One

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Tags: Card Debt Credit Card Credit Card Debt Debt
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