Your Life = your credit

CREDIT IS EVERYTHING!

What is the american dream? home ownership? car ownership? business ownership?

Anything is attainable in the land of the free or is it? In the early days when the idea of suburban life came about things where much simpler. In the days where having a good job and a nice set of morals allowed you to walk to a bank and discuss lending options with your banker. the days where your worthiness was determined by an evaluation of accomplishments.

man things where great! what happened?

YOUR CREDIT SCORE HAPPENED!

YEAH! not a bad thing right ? WRONG! The credit score system is a responsible one that helps banks and businesses decide whats the right risk when lending or advancing products to an individual... BUT who taught you how it works? or what it is ? or how to fix it??????

what is a credit score?

*A "credit score" is a statistical number that depicts a person's creditworthiness. Lenders use a credit score to evaluate the probability that a person repays his debts. Companies generate a credit score for each person with a Social Security number using data from the person's previous credit history. A credit score is a three-digit number ranging from 300 to 850, with 850 as the highest score that a borrower can achieve. The higher the score, the more financially trustworthy a person is considered to be. -*Credit Score Definition by Investopedia

so you have one of these ?

Probably not ! 30% americans don't and thats a fact!

here are some facts

The majority of consumers have subprime credit scores, report says- The Washington Post
  • Now back to that 30% figure: That’s 30% of all consumers who have a score with at least one of the credit bureaus, or what VantageScore calls a “score-able” person. VantageScore says there are about 220 million score-able people and 68 million of them have bad or poor scores (lower than 601), which is how they got to that 30% estimate.
  • Though Americans’ average credit score (for those who have established credit history) has been slowly improving since the Great Recession, most consumers have credit that is less than stellar. Fifty-one percent of the nation’s credit users have subprime credit scores (under 720), while one in three has a score lower than 620.

how does credit work?

your credit has 4 major components.

Payment history = how well you pay your debts. It is measured by time

  • Details on late or missed payments ("delinquencies") and public record and collection items
  • How late they were
  • How much was owed
  • How recently they occurred
  • How many there are

Amount owed = Dollar sum of debt or credit.

Credit Length = amount of time with an account

Type of Credit = there are many different types of credit lines you have. theses include ;

  • Credit cards (Visa, MasterCard, American Express, Discover, etc.)
  • Retail accounts (credit from stores where you shop, like department store credit cards)
  • Installment loans (loans where you make regular payments, like car loans)
  • Finance company accounts
  • Mortgage loans

New Credit = pretty self explanatory.

what hurts your credit?

  • Payment history -The first thing any lender wants to know is whether you’ve paid past credit accounts on time. This is one of the most important factors in a FICO® Score.
  • Bankruptcies - will stay on your credit report for 7-10 years, depending on the type
  • Foreclosures
  • Lawsuits
  • Wage attachments
  • Liens
  • Judgments

Now that you know hurts lets get to work

know the difference

I'm going to share some free resources and teach you how to use them to get your life back on track!

first things first! you need to know what your score is.

Here are some free sites and apps you can use.

The government has a site where you can obtain your credit report for free once a year. This site is :https://www.annualcreditreport.com unlike other free services you can view all three Major Credit Bureaus reports and dispute inaccuracies. This should be the first thing you do if you haven't already done so.

Credit Karma:  https://www.creditkarma.com is a popular site and app with many features. They give you a free Transunion and Equifax along with a few other nice features like

  • Credit Monitoring
  • Inaccuracy disputes.
  • Education and recommendation of products that can potential benefit you.

Clarity Money is a very useful sit and app to help you better manage your finances while keeping you up to date with your credit score. its also free and comes with some perks like :

  1. keeping track and organizing your expenses when you link your bank account.
  2. saving you money by looking for offers with your current subscriptions or "bills" to reduce your current spending.
  3. they help you cancel subscriptions by keeping them organized and giving you the option to cancel.
  4. they help you create customize budgets and alert you when you get close to your spending limit for a specific item.
  5. you get a free Experian credit score and report along with the rest of the perks at no cost.

Credits:

Created with images by Bart Claeys - "Financial Responsibility in the United States" • cafecredit - "Credit Score Breakdown" • cafecredit - "Good Credit Score" • cafecredit - "Poor Credit Score" • cafecredit - "Credit Score - Blue"

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