• Understanding Credit

  Filed under Credit Cards, Finances
  Mar 11

  Credit is a tricky thing, especially today with all that is going on. A lot of people don’t understand how it works, don’t know their credit score and have never even looked at their credit report. This can all add up to bad news for a lot of reasons, so lets explore the world of credit.

  First of all, if you are paying for everything in cash, stop right now. Go to your bank and get a credit card. The only way to get good credit is to have a credit history. If you have none, then get a credit card, apply for a small student loan if you are in school, buy a cheap car if you are in the market, etc. Do something to establish a credit history, becasue your credit score could be more important than you think.

  Most of us know that lenders look at our credit. If you want a house and need a mortgage, you better believe the lender will look into your credit score. But what about getting insurance, applying for a job or buying a cell phone? How about renting an apartment? Most people don’t think about that, but some of these people will look at your credit score. You better have a good one there for them to find.

  Landlords won’t take chances on people with poor credit scores. They view them as risky tenants. Some employers measure an individual’s responsibility by looking at their credit score. Insurance premiums go up if you have a lower credit score. It can affect you in a variety of ways. So it’s important to keep track of.

  There are several ways to check your credit. Experian, Equifax and Trans Union are the three major credit bureaus. MyFICO.com offers a free 30 day trial where you can sneak a peek at your credit score. Use these services and make sure you credit is untarnished.

  If you find you have made some mistakes and have a low credit score, don’t worry. There’s a few things you can do to imrpove your credit score. Don’t use more than half the available credit on your credit card. Don’t close any unused accounts. Don’t consolidate your debt. It’s better to have a bunch of old accounts open with low balances, it looks good on your report.

  Hopefully this has helped you see that credit is important, and you should know that your credit score extends beyond just getting a loan. Make sure you are always working to keep your credit score high.

  Tagged as: credit
  
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