That’s the difference between you and your neighbor who has a 760 credit score and your 639 score. They secured a home loan for 2% less than you (and a reduced Risk Assessment % — yep, that’s built into the loan APR from your lender, did ya know that?) which saves them over $200 per month in payments and leads to a savings of over $73,000 over the life of a 30 year fixed loan (of $216,000).
Holy smokes! That’s college tuition, a new car or even a little cushion each month ($200) to have some fun!
Well there are four things you can do right now to help yourself so the NEXT time you buy a ______ (insert major purchase… or any frankly… take a look at those credit card rates! yikes!)! And one thing that is totally silly.
- Get your free annual credit report from ALL THREE BUREAUS. Go to www.annualcreditreport.com each year to get your report (not score mind you, but the details that determine your score). TIP: Mind the navigation as you return to the Annual Credit Report website after each report prints to get the next report.
- Read the attached myFICO_UYFS_Booklet PDF or call me and we’ll go over your reports (760-422-3042).
- Set up this simple system:
- Find one of your credit cards that has a high limit with “0” balance (or pay it off)
- Grab a monthly recurring bill that you can pay online with a credit card automatically (I use my cell phone bill)
- Set up your bank account to automatically pay that credit card off (balance in full) each month
- Sit back and enjoy — a nice, tidy system to help move your credit in the right direction.
- Pay off any credit card debt you have. Most will say to start with the highest interest first… I agree.
- If you don’t have any credit or are rebuilding your credit = Get a secured credit card from your bank. Put the system in place from #3 above.
- Have someone you know put you on their credit card as an authorized user (all that activity will count toward your score)
Totally Silly – Don’t sign up for any “FAKO” score program from the 3 credit bureau. They aren’t a real indication of what a lender uses to determine your “FICO” score. You’ll be paying each month for a useless score. Personally I don’t use “credit monitoring” — seems silly. A few phone calls and you can freeze your credit any time. Plus, if you check your statements regularly that seems like enough… Identity theft issues aside…
Okay, get started right now by going to Annual Credit Report.com for your report! Then report back on your progress or if you have any questions!
You’ll be way better off for your next home – car – (major purchase)!