May Newsletter

At Last

The 12 Month System

To a 720 Credit Score

Presented by

Lori

EZQualDreamHomes.com and Swiftcurrent Investment Group

Dear < Name>,

If you are just joining my newsletter group...Welcome. You can always go online to our website. I have put a tab on there just for you called current tenant information. Here is the link: www.ezqualdreamhomes.com/current_tenant_info.htm

There you can access class reviews over the past year and under the heading articles and forms you can find newsletters that goes by month. I hope this is helpful.

So, let’s get started. From the previous newsletters; you are now well aware of what a FICO score is and why it is so important. We have reviewed the 5 most important factors that are considered in the credit score formulas are:

1.     Your payment history

2.     The amount of money that you owe

3.     The length of time you have had credit

4.     The type of credit that you have

5.     How many credit Inquires

You understand exactly what your payment history involves and that it is very important to have a solid track record of making all your payments. That is why you need to make changes now, so that over the next 12-24 months you will see your payment history improve and subsequently see your credit scores improve as well.

You want your scores to reflect a positive payment history; that you make your payments and you make them on time. This is key when a lender is looking at your application for a mortgage they want to see that you are a solid candidate and you are responsible and will make your payments as you promised. On time. Every time. This is why I encourage you and preach to you about making your rent payments on time. These payments are tracked in our office and if you are taking advantage of ClearNow autopayments, they can be reported to the credit bureau directly.  This helps you get qualified for your mortgage.

 Let’s move onto the next important factor utilization rate . This is where the basic concept is that you should only be spending around 30% of your available credit in order to bring your scores up.

In previous newsletters we reviewed the types of credit cards out there. The how and the why you need to use credit cards to help establish and improve your credit.

 Now, This month we are going to see if your credit is being reported accurately by the credit card companies. This is important because FICO scores not only based on if you pay by are you using your available credit wisely or responsibly. If the amount of available credit is recorded incorrectly, then all the other numbers in the FICO score become invalid.

So…Are your credit limits being reported accurately?

Many times the credit card companies will inaccurately report what your credit limit truly is. By reporting the wrong limit they adversely affect your credit scores.

Why do they do credit card companies do this?  For business of course….they need customers and they want to keep the customers that they have. They do not want to loose you to a competitor with a lower rate so they do not report your correct credit limit. They often report a lower number so that other companies will not market to you. For example, your credit limit may be $5000.00 but when the credit card company reports your payments to the credit bureaus they say your credit limit is only $1000.00. 

This can drastically affect your utilization rate which ultimately will bring down your FICO score. If you have the above credit of $5000 and you have only spend $1000 of it, your utilization rate is 20% but if they reported your credit limit at $1000 that would bring your utilization rate up to 100% which would bring down your FICO score.

It is important for you to compare your limits reported on your FICO scores with those that you have on your credit card statements.

You know-  where up in the top corner it says:

·        Credit Line: $XXXX  (this is what you want to match the FICO record)        

 If there are errors you need to send a letter to each of the credit card companies associated with the incorrect limit demanding that it report the actual limit to the respective credit bureaus (Equifax, Experian, TransUnion). Make copies of the letter, copies of your credit card statement and copies of your credit report and send the copies by certified mail. You want to keep the originals for yourself. You should also send a letter  explaining what you need with your identification and anything to support your request like proof of the credit limit to each of  the credit bureau as well.

You should be working with one of our finance experts to that they can go through this with you and direct you on what to include in the letter and where to send it.

Remember that the goal is to have a certain amount of credit available on a credit card but only use up to 30% of what is available in order to see your FICO scores improve. It is all these little things that will add up and bring your scores up over the next 6-12 months.

You are well on your way to becoming very knowledgeable about credit reports, more specifically YOUR credit report and how you can improve it. Your diligence and persistence will pay off with unlimited availability of great interest rates when your scores go up! Don’t forget if you have questions or need some assistance with improving your credit call your finance specialist first and if you need more assistance they will contact me if there is anything that I can do. Your finance specialist can get credit issues solved faster than I can, but I am happy to assist you in any way.  

Remember we have our monthly classes where you meet the financial specialists and learn a lot of information in a short time.

Dedicated to improving your credit and making you a home owner,

Lori

Swiftcurrent Investment Group, LLC

EZQualDreamHomes.com

719-648-5223

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