Perhaps you’re newly unemployed and are worried your score will be affected. Maybe you’re wondering whether or not filing for unemployment will affect your score.
This article has all the answers you need, as well as some helpful advice to help you avoid bad credit if you are unemployed!
Does Unemployment Affect Credit Score? Here’s the Answer!
Your credit report does not record whether you are employed or unemployed, nor does it record if you file for unemployment. Rather, it only shows credit and debt-related information.
So the short answer is no. Unemployment does not have a direct relation to your credit score. However, it’s important to note that some lenders will not provide loans to unemployed individuals, even if you do have a good credit score.
While unemployment itself doesn’t affect your score, the effects of being unemployed could negatively impact your credit score. Here’s how!
How Unemployment Can Affect Your Credit Score
If you are unemployed, it may be difficult for you to pay off your debt, and funds may be limited. Here are some ways not having a steady income can affect your score:
If you are late by ninety days or more, it’s considered a serious delinquency by the credit bureaus, and your score will drop even more.
Therefore, if you are unemployed, make sure you don’t miss a payment!
2. Using Your Credit Card Too Much
The available credit you have makes up 30% of your credit score. Therefore, as a rule of thumb, you should never use up more than 30% of your credit card limit. Otherwise, you could damage your score. Additionally, if you can’t pay the minimum payment at the end of the month, it could damage your score.
In the end, never use more than 30% of your credit card limit and use cash when you can. This will help you avoid accidentally going over and harming your score. Additionally, it will help you use your credit card to build good credit.
3. Bounced Checks Could Wind Up in Collections
If a check bounces, it won’t directly affect your score. However, if you can’t cover checks you have written, a check could wind up in collections, which does appear on your credit report. This can also cause problems with your bank account credit.
Before writing a check, always make sure you have enough funds in your account. In other words, if you need to make a payment on something, ensure you have the funds to pay it.
Find Credit Help
In the end, does unemployment affect credit score? No, but if you don’t make payments, use over 30% of your credit card limit, or acquire a collections account, your score can drop fast.
If you find yourself with bad credit, a qualified credit repair company can help. Go Clean Credit is a leading credit repair specialist in Arizona. In fact, their credit restoration services can help resolve collections, late payments, bankruptcies, student loans, identity theft, and so much more!
Go Clean Credit’s mission is your success. They know that good people sometimes have bad credit, and their goal is to help individuals like you reach your financial goals. Even though credit repair can seem overwhelming, Go Clean Credit is here to partner with you to make the process easy.
Contact them today for a free consultation and learn how they can help you get a great credit score!
When you apply for a loan, lenders will check your credit score and credit report to determine how trustworthy you are at paying back your loan. The lower your credit score, the more interest you will pay for the loan. If your score is too low, you may not qualify for the loan at all. In fact, there are different loan approvals at each credit score.
However, a no-credit check loan is a type of loan where a lender does not check your credit score before giving you the loan.
If this seems too good to be true, it’s probably because it is. Read on to learn about all the risks involved with taking a no-credit check loan!
Be Aware of These No-Credit Check Loans Risks
1. No-Credit Check Loans are Notorious for Predators
Lenders who don’t check your credit score before giving out a loan are probably using predatory practices. Nine times out of ten, you’ll be scammed.
Think about it: if a lender doesn’t check your score, it means they don’t care if you pay back the loan. So how does the lender make money if you don’t pay back the loan?
Exorbent interest fees, hidden charges, and late fees.
2. A Cycle of Debt
No-credit check loans are common among payday lenders. These lenders give loans to people they know are unlikely to make payments on time. Payday lenders will then make extra cash because they charge you additional interest and late fees. When this happens, you owe more money, making it harder to make the next payment on time.
In addition to the high fees and interest rates, they force you to make payments on time. The lender may ask you to write post-dated checks that they will cash once the payment is due, or they may force you to give them access to your bank account so they can take out auto-withdrawals when payments are due. If you can’t make payments, they may even make you take out another loan!
It thus turns into a cycle of debt in which the lender continues to make money off of you, and you continue to fall short of paying off the loan. It can be a scary cycle that’s difficult to crawl out of.
3. There are Consequences of Not Making Payments
As mentioned, no-credit check lenders will often force you to make payments on time. If you can’t make those payments, there could be more consequences than just more debt.
For example, say you take out a car title loan, which is sometimes offered as a no-credit check loan. The lender may require you to put your car up for collateral. Therefore, if you can’t make the payments, your vehicle could be repossessed.
Get Credit Help To Get a Trustworthy Loan
In the end, taking out no-credit check loans can be extremely risky. However, that doesn’t fix the fact that you need a loan and don’t have the credit score to get a good one.
So what do you do?
The best way to qualify for a loan is to repair your credit. The best way to repair your credit is with a qualified credit repair company.
The thing is, you could have a bad credit score because there are errors on your report, late payments, derogatories, unpaid debt, or something else. Credit repair companies work to remove those negative items on your report so you can improve your score fast!
A single medical collection can hurt your credit score by as much as 100 points! But what is a collection?
A medical collection is a medical debt that is sent to a collection agency. The collection agency will then try to recover the money you owe. This is recorded on your credit report and drastically effects your credit score.
In this article, you will learn exactly how to remove medical collections from a credit report. Read to learn more about how you can increase your credit score fast!
Find Out How to Remove Medical Collections from a Credit Report!
1. Dispute the Collection
One of the most common ways to remove medical collections from a credit report is to dispute the collection. How do you do that?
If you have a debt recorded on your report you don’t think is accurate, it’s a good idea to ask for proof that the statement is accurate. If the debt collector cannot validate the collection, it will make it easier to remove the collection.
Next, you’ll be able to file a dispute with the credit bureaus. To do this, you can contact the credit bureaus directly or get the help of a credit repair company.
Once a credit bureau receives your dispute, there are several ways a collection agency will handle it. Eventually, they will contact you, and you will either resolve the debt through negotiation or repayment.
2. Check How Old the Debt Is
After a certain period, typically seven years, a collection will disappear from your credit report. Check the lifespan of your collection. If it is almost due to disappear off your report, you may not have to pay it. Additionally, the debt collectors won’t be able to sue you to collect. In some states, the debt is revived, and it won’t disappear from your report.
3. Pay for Delete
One way to completely remove a medical collection from a credit report is to negotiate with the collectors to pay the amount. In exchange, the collection will be removed. Make sure the debt collector sends you a pay-for-delete letter in the mail. Otherwise, you won’t have any assurance that the debt collectors will remove the collection from your account once it is paid off.
Even though you now know how to remove medical collections from a credit report, it doesn’t mean you will be 100% successful. However, there is a more foolproof way to get rid of the collection for good! How?
Enlist the help of a credit repair company! Go Clean Credit is one of the leading credit repair companies. They have over a decade of experience removing collections from reports.
Go Clean Credit knows that good people have bad credit, sometimes through no fault of their own. They are dedicated to helping you find financial success and achieve your goals! For more information about how Go Clean Credit can help you remove medical collections from your report (and so much more!), contact them today!
Do you have great credit, but just can’t seem to reach 800?
If so, congratulations! Most people don’t have a credit score that good.
However, to learn how to increase a credit score to 800, you have to understand what makes up your credit score. According to MyFico, your score is calculated from the factors five different factors:
In other words, these five factors determine your overall score. Based on these numbers, this article will show you exactly how to increase a credit score to 800!
Learn How to Increase Your Credit Score to 800 in a Few Simple Steps!
Never Miss a Payment
Your payment history alone makes up over one-third of your credit score!
So how does this impact your score?
Missing one payment can drop your score by 50-75 points! If you keep paying your bills on time, you’ll not only maintain awesome credit, but you can increase your score fast!
Use a Fraction of Your Credit Limit
Your credit utilization, or amounts owed, make up 30% of your overall credit score.
Going over your credit card limit can drop your score by 40-50 points. However, as a rule of thumb, you should try to only use about 10% of your credit card limit.
The most effective way to do this is to have high credit card limits, but only spend a small amount. Moreover, if you have a tough time staying this far below your credit limit, you can try to raise the limit.
Acquiring high limits and restricting your credit usage will improve your use-to-limit ratio. As a result, your credit score will improve!
Maintain a Long Credit History
It’s best to keep old credit cards rather than opening up new ones. Why?
Well, the length of your credit history contributes to 15% of your score. What does that mean exactly?
Let’s say you got a credit card six months ago and paid off all your bills on time. That’s a good start, but it doesn’t look as good as if you had a credit card for ten years and paid all your bills on time.
Typically, your average credit history age plays a role. For example, say you opened an account ten years ago and another six years ago. Your average credit history is eight years.
On the other hand, say you opened a credit account every two years for the next decade. Your average credit history would only be five years. Therefore, a good rule of thumb is to have a few old accounts rather than have multiple new accounts. Moreover, don’t close old accounts—they dramatically increase your credit score!
Pursue a Mix of Credit Types
There are two types of credit you can pay back: revolving accounts like credit cards and installment loan accounts like mortgages or student loans.
Credit cards are revolving accounts, which means the amount you owe will change from month to month. As mentioned before, it’s best to keep this balance low.
On the other hand, installment loans have a fixed number with a set number of scheduled payments. When you pay off an installment loan, you no longer owe money. Paying off these loans can actually help to improve your score, though usually only a minimal amount. The important thing to remember is to make payments regularly.
Overall, having at least one of each type of credit will actually benefit your score. This is called your credit mix and makes up 10% of your credit score.
Remove Derogatory Items
Derogatory items on your account include bankruptcies, judgments, collection accounts, charge-offs, late payments, and accounts that are settled for less than the full balance.
These items on your credit report can significantly lower your credit score. In fact, if you are close to 800 but just can’t seem to reach it no matter what you do, it is worthwhile to check your credit report for derogatory items.
There are a few ways to remove these negative statements. For example, to remove a late payment, you may have to negotiate with the creditor.
To remove a bankruptcy, however, you will have to wait until enough time has passed—usually between seven and ten years. Another way to remove derogatory statements is to get the help of a credit repair specialist, who can expertly negotiate the removal of any negative items on your report.
Get Professional Credit Help!
Do you need derogatory items removed from your credit report or simply want some expert advice on how to increase your credit score to 800? A credit repair company has the answers you need!
Go Clean Credit is one of the best credit repair specialists. They are passionate about making your financial dreams come true through their personalized credit repair services. Moreover, they can help with a number of issues that may be on your report. If you need help getting your score to 800, contact Go Clean Credit today for more information!
If you are like most Americans, you already have a credit card or are planning to get one. However, the way you handle your credit card will have a huge impact on your credit score. If your credit score drops, you will have higher interest rates on your loans. Or worse, you won’t qualify for loans at all.
That’s why we’ve prepared a guide that will help you learn how to use a credit card so that it increases your credit score. In the article, we will cover the following:
If you do not use a credit card correctly, your credit score could drop. Therefore, we have some helpful tips that are sure to help you use your credit card in a way that will improve your credit score.
Firstly, try to use your debit card or cash whenever you can. Even small transactions on your credit card can add up, resulting in a large monthly payment. The more you use cash, the more likely you will be able to keep debt to a minimum and your credit score high.
Note: A good rule of thumb is to only use your credit card for things you need, not the things you want. In other words, if you go on a shopping spree, use your debit card; if your car needs maintenance, use your credit card.
Secondly, never miss a payment. At the end of every month, it’s important to at least make the minimum payment. If possible, pay off the entire balance. If you make a late payment or miss one, it can lower your credit score by 50-75 points! Consider setting up autopay if you tend to forget to make those monthly payments.
Lastly, never go over your credit card limit. If you spend even a penny over your limit, your score can drop by 40-50 points! This point difference is staggering, especially if you plan to buy a house or car soon.
Most Americans have three to four credit cards. However, depending on your circumstances, you may prefer to have more or less. So what are the pros and cons of having more than one credit card?
Pros of Having More Than One Credit Card
Keeping multiple credit cards allow you to spread outstanding balances. In effect, you’re less likely to reach your limit on one or more accounts. In other words, having more credit cards will give you leeway and flexibility. It’s usually a good idea to have a backup credit card in case your usual card is not accepted or is lost or stolen.
Moreover, different credit cards offer rewards. For example, one card may offer points for hotels or airline miles. Another card might give you cashback on groceries or gas. No one card will give you all the rewards, so having multiple cards might benefit you. However, don’t gravitate toward cards just because of their benefits. Consider whether you’ll use the credit card benefits or if they’re just a nice perk.
Cons of Having More Than One Credit Card
First, it’s not always easy to keep track of spending and payment due dates with multiple cards. For instance, it can be easy to forget how much you’ve spent on each credit card amount.
As mentioned, if you go past your limit, your score could be damaged. Likewise, if you lose track of the payment date, you may miss a payment deadline. The result is a damaged credit score! So if you have a hard time sticking to budgets or juggling too many due dates, acquiring multiple credit cards may not be for you.
In the end, try to keep your credit utilization ratio to 30% or less. In other words, if you are spending more than 30% of your total available credit on each card, you have a greater risk of damaging your credit score.
Note:It’s usually not a good idea to have store credit cards. For one, they increase the temptation to go on more shopping sprees. Moreover, store credit cards also decrease the age of your overall credit history, ultimately lowering your score. The high-interest rates are simply not worth it.
So, How Many Cards Should You Have?
The answer depends on your circumstances. However, as long as you make payments on time and don’t pass your limit, your score shouldn’t be negatively affected.
When learning about how to use a credit card, it’s important to know the types of repayment methods. Basically, there are a few strategic ways to pay off your credit card balances. Listed below are two techniques to successfully pay off a credit card balance:
The Snowball Method. It involves paying off the smallest balances first. After it’s paid off, you move to the next highest balance. If you have a lot of debt on different credit cards, this method may work best.
The Avalanche Method. With this method, you pay off the debt with the highest interest rate first. If you have high interest accruing on certain accounts, this method may work best.
As you start making these payments, it’s always best to pay more than the minimum whenever possible. Why?
When you pay more than the minimum, you decrease the amount of interest you pay over time and pay off your debt sooner. Moreover, your credit score can drastically improve as you pay off your debt. Lastly, having little to no credit card debt makes it easier to make large purchases, such as buying a home or car.
Before deciding on a card, check to see if there are annual fees, what the APR amounts to, if the card is accepted at your list of frequently shopped stores, and how the benefits measure up to the costs of the credit card. Why? You need to learn how to use a credit card that you plan on using.
Cards with Perks
As noted, some credit cards offer rewards or extra perks. While this might be a great benefit for some, it’s important to ask yourself whether or not you plan to actually use those benefits.
Spending hundreds each month to collect a reduced airfare or a free concert ticket once in a blue moon may not make sense for your budget. Do your research and don’t let a credit card’s marketing ploy win you over.
Credit Cards with an Annual Fee
If it sounds too good to be true, it probably it! Cards that have amazing rewards, low-interest rates, and superior payment options likely has an annual fee.
Should you get a credit card with an annual fee?
When you’re looking at a credit card with an annual fee, take a look at what benefits they offer and compare the cost to what you’ll get. Is the annual fee too high for what you’ll be getting? If so, that credit card might not be worth it. Ask yourself if you will actually use those benefits, if there are any hidden fees, or if there are better deals out there.
Credit Cards from Unions
Banks aren’t the only institutions that offer credit cards. If you’re not having much luck getting approved for one, consider credit union credit cards. They offer more chances to get a credit card that can potentially make it easier for you.
Should you get a union credit card?
Credit unions are member-owned nonprofits. As a result, when you get a union credit card, you generally get a more personalized experience. Additionally, credit unions offer low-interest rates and flexible repayment methods.
Nonetheless, there are a few things that you should scrutinize. Credit union has specific entry requirements. When you join a credit union, all your accounts are tied together. And, credit unions are easily affected by local problems in the community.
In the end, the type of credit card and where you get it depends on your unique situation.
Need to Repair Your Credit?
Now that you know all about how to use a credit card, it’s important to note that it’s are a great tool for preparing yourself for greater investments down the road, like purchasing a car or house. Nonetheless, if used irresponsibly, it can harm your future buying power.
If your credit score isn’t where it should be because of credit cards, contact Go Clean Credit. Go Clean Credit is a top credit repair company in Arizona that is passionate about getting you on the road to success. Over the last 15+ years, this credit repair company has helped thousands of people reach their financial goals.
Contact Go Clean Credit today to learn more about how they can personally help you!
Your credit score is an important number that tells lenders how reliable you are at paying back loans and credit. A high credit score will qualify you for the best terms and conditions when taking out a loan. Therefore, a drop in your credit score can cost you thousands of dollars over the repayment course of a loan. If your credit score dropped 100 points, it can drastically affect it.
But don’t despair! It’s possible to fix the situation. In many cases, there is simply an error in your report. Read on to learn what you can do if your credit score dropped 100 points!
What To Do If Your Credit Score Dropped 100 Points
1. Identify the Problem
If your credit score has dropped 100 points, there are probably some major problems that have recently appeared in the report. For example, there could be an error on your report, you may have made a late payment, or you may have an outstanding collection due.
To determine what made your credit score drop 100 points, you will have to get ahold of your credit report and identify the problem. To acquire a copy of your report, you will have to contact one of the three major credit bureaus or go to annualcreditreport.com. After you verify your identity, you will have access to your report. Next, you can analyze it to find where you might have a problem.
2. Remove Errors on Your Report
If your score drastically drops 100 points, chances are there is simply an error on the report. According to the Federal Trade Commission (FTC), one in every five consumers have errors on at least one of their three credit reports. That means that there is a high chance you may have an error in your report.
If you believe there is an error on your report, you will have to contact one of the three credit bureaus and report the error. They will then investigate the items. If they cannot be proven true, the items will be removed from your report. You should try to find copies of the documents that support your claims.
3. Remove Late Payments
Late payments on loans and credit cards can drastically affect your credit score. For example, a collection can lower your credit score by 100 points. Likewise, removing even a single late payment from your report can improve it anywhere between 30 and 100 points! Moreover, late payments can stay on your report for up to seven years.
Removing a reported late payment isn’t easy. However, it isn’t impossible either. It takes a lot of persistence to either have a goodwill adjustment or find inaccuracies.
4. Remove Debt
Debt weighs heavily on your credit score, contributing to 30% of your overall score! Even a small amount of debt on your report can drop your score hard and fast.
Unless the debt is an error on your report, this will likewise be difficult to remove. However, it isn’t impossible. To remove debt from your report, you will likely have to contact the original creditors. If the debt is past the statute of limitations, the creditor can no longer legally demand payment. Moreover, be careful not to admit that the debt belongs to you.
5. Build Your Credit The Old Fashioned Way
If you have no errors on your report and cannot remove any late payments or collections, you may have to build your credit the old fashioned way. To build your credit fast, charge small amounts to your credit card and pay it off at the end of every month or even become an authorized user.
However, the time it takes for you to repair your credit will vary. To improve your score as fast as possible, you will want to employ multiple strategies at once. You can bump up your score in as little as 30 days if you pay down revolving balances, remove recent late payments, remove a collection account, and/or raise your credit limit.
Your credit score is an important number that determines how reliable you are at borrowing money and it can have a big impact. For example, if you have a low score, it can make it difficult to qualify for loans. Therefore, if you have a low score, it’s important to improve it before buying a house, car, or making another large payment. You can always use a do-it-yourself credit repair software or simply try to improve it on your own. However, these methods involve you putting in a lot of work and often, you aren’t even guaranteed results.
A credit repair company may be the answer you need! Keep reading to find the top credit repair companies in Prescott, Arizona!
Repair Your Score With These Top Credit Repair Companies in Prescott, Arizona!
1. Go Clean Credit
Our number one credit repair company in Prescott is Go Clean Credit. They are passionate about helping individuals be triumph over the pitfalls of bad credit. Moreover, their individualistic approach recognizes you as a valued individual who needs credit repair services, not as a faceless customer who simply has bad credit. They know that good people sometimes have bad credit -and they know exactly how to help!
They work hard to simplify the seemingly overwhelming process of improving your credit. In the end, their mission is your success! Contact them today to get started!
2. Andorra Credit Repair
Andorra Credit Repair believes you shouldn’t have to wait any longer with a bad credit score. They provide an immediate action plan for a speedy repair. Essentially, heir experienced professionals work hard so you don’t have to be frustrated over bad credit any longer. Moreover, they offer multiple credit repair services so their customers can experience a complete recovery from a bad score.
3. Credit Absolute
Credit Absolute sees results fast! Within 30-90 days, your credit score can increase anywhere between 40-100 points with the help of their credit repair experts. They are driven by positive results. Credit Absolute also has a very personable approach. You speak directly to a credit expert over the phone or in-person and they explain to you why you might not be getting loan approvals, among other things. Next, they communicate with you every step of the way so you know exactly how they are fixing your report.
4. Anytime Credit Repair
Anytime Credit Repair has a data-driven approach. They know that 79% of credit reports contain errors. If a credit bureau can’t prove that it is valid, the bureau must remove it. Therefore, Anytime tries to get all those negatives off your report so your credit score improves in a timely manner. Moreover, their customer-service-driven approach paves the way for happy, satisfied customers.
5. Zorro Credit
Zorro Credit’s philosophy is to get your score repaired as fast as possible. Their team of experts sits down with you to create a clear plan to drive the quick results. Their team of highly qualified lawyers dispute errors on customers’ reports every day. They can remove collections, late payments, bankruptcies, charges, and foreclosures. They have the experience you need to get the right credit score.
6. Credit Revitalize
Credit Revitalize is proven to be 3x more effective than a typical credit repair service. They’ve developed a revolutionary, high-tech way of improving credit fast. They can even challenge up to sixty items on your report at a time! Furthermore, they are able to permanently delete all types of negative credit. They believe everyone has the right to a fair and accurate credit profile.
Start Repairing Your Credit Today!
With so many credit repair options, improving your score is easier than ever. Contact one of these top credit repair companies in Prescott and increase your score today!
It’s important to build credit so you can qualify for loans and aren’t tied to a loan with bad rates. Perhaps you’ve wondered what loans you qualify for and how to compare good credit vs bad credit. Whether or not you qualify for particular loans usually depends on the lender, but your credit score will determine how high your interest rates will be, as well as the down-payment amount. Keep reading to learn more about how good credit vs bad credit effects loan approvals!
A credit score in this range will make it extremely hard to get approved for loans, but it’s not impossible. For example, if you want to buy a house, most lenders will outright reject you. Even if you do qualify for a home loan, you will have extremely high-interest rates, even at rates half the principal loan.
With car loans, you still have the possibility of being outright rejected but are otherwise easier to find. However, you will still have exuberant interest rates that could cost you upwards of $10,000 over the term of the loan!
With personal loans, if lenders don’t reject you, they might ask for collateral. This could be a title lien or a home deed. However, this can be extremely risky. Otherwise, your interest rate could be upwards of 20%!
Score of 530-549
As with the previous scores, your down payment and interest rates for a car or house will be extremely high. Lenders may even require you to have a co-signer for added security. However, it’s still not impossible to get approved for some loans.
To get a better idea of how this score can make life difficult, consider you are purchasing a house of $300,000 and you have a credit score of 535 to 540. Your interest rate is 5.9%, which is a jump from someone with excellent credit, 4.31%. It may not seem like much difference, but over the course of the loan, you will pay about $105,000 more than you would with excellent credit!
Next, consider the price difference of an auto loan. Say your car costs $27,000 and your score is 535. With a 36-month payment agreement, you will pay roughly $500 more than with a score of 615. With a 48-month payment plan, you will pay roughly $700 more than with a score of 615. Last but not least, a 60-month plan will have you paying about $900 more than if you had a score of 615. That’s right! An 80-point difference in your score could cost you $900!
A score of 540 isn’t looking much better. Your interest rates are still too high. With a $27,000 car loan, for example, a credit score of 640 will put interest rates a little over 9%, while a score of 540 will be a little over 14%. That means with a 36-month auto loan, you will pay about $2,500 more, with a 48-month loan, $3,500 more, and with a 60-month loan, $4,500 more.
Score of 550-579
With a score of 550 to 560, a $300,000 house can cost you over $68,000 more than if you had excellent credit over the course of the loan. While this isn’t as bad as a score of 540, it is still an enormous expense that will carry with you for years.
If your credit score is anywhere between 540 to 570, car loans will have a similar expense. With a $27,000 car loan, for example, a credit score of 640 will put interest rates a little over 9%, while a score of 540 will be a little over 14%. That means with a 36-month auto loan, you will pay about $2,500 more, with a 48-month loan, $3,500 more, and with a 60-month loan, $4,500 more.
Score of 580-619
A credit score of 580 is a magical number where The Federal Housing Administration (FHA) will offer a home loan with only a 3.5% down payment. Anything lower than this, and your downpayment for an FHA home loan is 10%! For example, if you wanted to buy a house that costs $140,000, your downpayment would be almost $5,000 cheaper than if you had a credit score of 530!
Keep in mind that even though you qualify for better FHA loans, most other home loan providers will charge high-interest rates and down payments. You could still be paying upwards of almost $70,000 more than someone with excellent credit, even if your credit score is 600.
With a credit score of 580, your car loan is still about 14% on a loan of about $27,000. Let’s compare it to a score of 680. With a 36-month auto loan payment method, you will pay about $3,700 more than if you had a score just 100 points higher. With a 48-month loan, you pay about $5,000 more. Lastly, with a 60-month loan, you pay about $6,500 more. In comparison, with a score of 590-600, your auto loan interest rate goes down to about 13%.
Loan Approvals With Fair Credit
Score of 620-659
So you’ve reached a credit range where things get a little easier! Yay!
With fair credit, it suddenly becomes much easier to get loans. Most loan providers will lend you the money you need at fairly reasonable rates. While the interest rates will still be much higher than of someone who has good or excellent credit, you’re not in the bad credit red zone, which makes it much easier to qualify for loans. Additionally, you won’t have to have a co-signer, give up collateral, or pay astronomical interest rates.
Loan Approvals With Good Credit
Score of 660-749
Good credit makes it even easier to get a loan. If you are turned down for a loan and you have good credit, it may be because your income is too low, your debt-to-income ratio is too high, you’re self-employed, have irregular income, or there’s an error in your credit report. Otherwise, you should qualify for any loan you want. Though you may not qualify for the lowest interest rates possible, your interest will still be exceptionally low.
Loan Approvals With Excellent Credit
Score of 750+
Congratulations! The world is your oyster. You are a free bird. Your tethers have been untied. You qualify for the best loan contracts out there, meaning you get the best interest rate with the lowest downpayment.
Improve Your Credit Score Today!
Now you understand the effects of good credit vs bad credit! If you have bad credit, it’s best to improve your credit score before you get out those moving boxes, take that nice car for a test drive, or make another large purchase.
Go Clean Credit is a company that helps individuals understand the difference between good credit vs bad credit and improve their poor credit scores. Contact them today for more information about how you can improve your score before you commit to a loan with bad rates!
If you’ve been reading about ways to protect yourself against identity theft, you’ve probably heard of a credit freeze. In this article, we will discuss everything you need to know about freezing your credit report. Keep reading to learn how you can freeze credit for free!
What is a Credit Freeze and What Does it Do?
Essentially, freezing your credit means restricting third-party access to your credit report. Because most creditors need to see your credit report before they approve a new account, freezing your credit will make it harder for identity thieves to open accounts in your name. However, your credit report will still be accessible to existing creditors, debt collectors, and government agencies. By federal law, credit freezing is a free service that does not impact your score.
So what does a credit freeze do for you? When you freeze credit, you are better able to control your assets and debt. However, it may make it more difficult for you to qualify for a new credit card or a loan. Additionally, it can make it difficult for you to access your own FICO score. It does not, however, prevent you from getting your free annual credit report.
How Long Does a Credit Freeze Last?
When you freeze your credit, you can temporarily lift or permanently remove it at any time. However, unfreezing your credit requires you to have a password or PIN. These options can be helpful if you want to open a new account, take out a loan, or get a new credit card since you can’t otherwise do these things without access to your credit report. However, in most states, the credit freeze will expire after seven years.
What is the Difference Between a Credit Freeze and Credit Lock?
You may have heard the terms credit freeze and credit lock used interchangeably. However, there are some differences between the two. The biggest difference is that credit freezes are protected by federal law, while credit locks are not. That being said, a credit freeze is much more secure than a credit lock.
For instance, while unfreezing your credit requires you to call the credit bureau and provide a PIN or password, unlocking your credit can be done anywhere at any time -even from your phone. A credit lock is a good option to use as a preventative measure to guard your credit report from identity theft. However, a credit freeze is a better option if you believe your credit report and personal data have been exposed.
Moreover, by federal law, all three credit bureaus offer free credit freeze. On the other hand, a credit lock is free at TransUnion and Equifax, but Experian requires a monthly fee. Whether you choose to either freeze credit or lock it simply depends on whether or not you need a secure way to protect your personal information through federal law, or you wish to protect your report while still having easy access.
How Do You Freeze Your Credit Report?
To freeze your credit report, you will need to contact each of the three credit bureaus: Equifax, Experian, and TransUnion. You will need to supply your name, address, date of birth, Social Security number, and other personal information. After your request has been processed, the bureau will provide you with a PIN number or password unique to you. If you wish to lift the freeze, you will need to have the PIN or password handy, so keep it in a safe place. Make sure you do this for all three bureaus in order to completely freeze credit.
Easily Get Credit Help Today!
If you have more questions about credit, a company like Go Clean Credit can be helpful! They are a passionate credit repair company that works to help individuals understand and repair their credit scores. For more information about how they can help you, contact them today!
Your home is more than where you hang your hat. It’s where memories are made—they are buildings that give you feelings of safety and security.
Whether you will be a first-time buyer or a seasoned mover, buying a new house is a big step in life. While there are many aspects that go into purchasing a house, one of the most important is your home loan. Without it, you won’t be able to pay for the house at all. However, your credit score actually determines what kind of home loan you qualify for -and even if you qualify for a home loan at all. Luckily for you, in this article, we will explain the credit score needed for a home loan.
What Credit Score Will Qualify You for a Home Loan?
How To Read Your Credit Score
You can request your score from a number of places, such as a credit reporting agency. Here’s how to understand your score:
Excellent Credit: a score of 750 or higher
Good Credit: a score between 660 and 749
Fair Credit: a score between 620 and 659
Bad Credit: anything below 619
What Credit Score Will Lenders Accept?
Basically, the answer depends on the lender. If your score drops below 660, however, lenders will start to see you as a potential risk. Some lenders might not give you a loan even if you have fair credit. On the other hand, other lenders might say that a score of 640 or 620 is where the line is drawn where they won’t approve you for a loan. If you have a bad credit score, you can expect to be turned down by most lenders. The credit score needed for a home loan doesn’t have to be excellent, but it needs to meet a lender’s requirements.
On the other hand, you could qualify for a subprime loan or receive a loan from the Federal Housing Administration (FHA), which is one of the only lenders who provide home loans for people with bad or fair credit. However, they have a minimum score of 580 to qualify for a low down payment advantage, which is only 3.5%. If your score is below 580, you are required to pay a 10% down payment to qualify for loans. If you have a fair or bad credit score, an FHA loan might be your only choice.
Does Your Credit Score Affect Interest Rates On Home Loans?
Yes! The difference between excellent credit and fair or bad credit can cost you tens of thousands of dollars over time. The lower your score, the higher the interest rates.
For example, according to “Home Loans with Bad Credit: What Credit Does For Your Payment”, if you have a home loan amount of $300,000 and an excellent credit score of 740, you qualify for the lowest interest rates possible. Let’s say your interest rate is 4.31% and your monthly payment is $1,487. One late payment can drop your credit score up to 100 points, so say one late payment drops your credit score to 690.
Lenders might see you as a risk and raise your interest rate to 4.71%, which adds about $70 to your monthly bill. It may not seem like much, but over the course of your mortgage, you will ultimately pay $25,560 more than if you made the payment on time! Likewise, if your score was just 20 points lower at 670, the added cost would come to $39,600!
In the end, your credit score has a huge impact on the terms and conditions of the loans you receive. The difference of a few points on your score could cost you tens of thousands of dollars.
Should You Improve Your Score Before Taking Out a Home Loan?
Even if you have a credit score needed for a home loan, it is always a good idea to improve your score before taking out a loan. The lower your score, the more money you will pay and the harder it will be to get out of debt. However, if you can prove to lenders that you are trustworthy by upping your score, you will qualify for better terms and conditions and lower interest rates. Try improving your score before taking out a home loan and save yourself thousands of dollars over the course of your mortgage repayment!
Easily Improve Your Credit Score Today!
Though it might seem daunting to improve your score, it really isn’t too hard. For one, read about the ways you can improve your credit score in as little as thirty days. If you happen to have bad credit, you can also contact a company like Go Clean Credit, who helps people restore their scores. By taking action now, you can start improving your credit score today, ensuring that you receive the best deal possible when taking out a home loan!