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Credit scores range from 300 to 900, and scores from 640 to 700 are considered excellent. Most lenders flatly refuse to even consider scores of less than 500, but still others will approve loans to new borrowers who have no credit scores at all. Needless to say,
borrowers with "excellent" scores qualify for most favorable rates and terms.
To find out what your credit score is you'll have to contact a lender or mortgage professional because report you request from any of credit reporting bureaus will not show your score. However, requesting your credit report (even from one of bureaus) can be a great first step to repairing and/or improving your credit score. So, at least once a year, get a copy of your report and READ ALL OF IT. The report will come with instructions on how to read it and how to correct misinformation. Once you have your report, do following:
1. Look for anything that may indicate someone else is using your credit such as reports that you have changed your address or newly opened accounts that you are not familiar with, etc. This is a good way to make sure you are not victim of an identity thief.
2. Correct errors on your report without delay by following instructions that came with it.
3. Pay your bills on time every time, ESPECIALLY YOUR MORTGAGE. Also remember that some bills that wouldn't ordinarily report to credit bureaus (such as your rent, utilities, phone bills and medical bills) will show up on your credit report as delinquencies if you don't pay them, and these "little, unimportant" bills can pull your credit score down just as quickly as other larger accounts.
4. Close any unnecessary accounts. Most lenders prefer that borrowers have a minimum of four open (active) accounts over last 24 months but once you've reached four, fewer additional accounts better.
5. Pay down your credit card accounts. Keeping your balances under 50% of approved limits is a definite plus for credit scoring.
6. Pay off collections and judgements. Full payoff is always preferable but if necessary, contact creditor and arrange a settlement for less than full amount owed. Afterward, make sure that you get written confirmation that debt has been paid and make sure that credit bureau reflects this on your credit report.
7. Think twice before authorizing new inquiries on your credit report. Too many in a short period of time really makes lenders nervous.
The three credit report bureaus are listed below. You can contact each of them by phone, mail or online. Credit reports cost about $9 each, unless you've been turned down for credit in last 60 days, in which case, report is free. Your credit report request should include your full name, social security number, current address, date of birth, and previous address if you've moved in last 2 years.
Equifax P. O. Box 105496 Atlanta, GA 30348-5496 800-997-2493 www.equifax.com
TransUnion P. O. Box 1000 Chester, PA 19022 800-888-4213 www.transunion.com
Experian (formerly TRW) P. O. Box 9595 Allen, TX 75013-0036 888-397-3742 www.experian.com
Carole Talley has been involved in numerous aspects of real estate such as examining property titles, originating and closing mortgage loans, purchase and sales contracts and more. She and husband, J. R., are veteran Real Estate Investors/Entrepreneurs in Ohio. For more information about this lucrative investment tool, contact them at www.mrdendi.cjb.net.
