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Credit Information
Tips on Managing My
Credit
by
Rob Polichetti
800-242-0919 ext. 102
rpolichetti@coastcities.net
1). What
determines your credit score?
A
credit score is a statistical number that ranges from 300 to 850 and
predicts the chances of you becoming late 90 days or more on a loan
obligation. The higher the credit (FICO) score, the less chance that
the consumer will default on that loan obligation, which explains why a
certain score will get you a certain interest rate.
Your score is
determined as follows:
35% of the score is determined by your payment history.
30% of the score is determined by outstanding balances being carried on
revolving accounts.
15% of the score is determined by “Average Length of Credit History”
for all accounts.
10% of the score is determined by “Types of Credit” being carried on
your report.
10% of the score is determined by amount and frequency of inquiries.
2). Are my credit scores based on accurate information?
Not usually. Three credit bureaus; Equifax, Transunion and Experian are
the sources for all (FICO), credit scores. They are private
organizations that generate their revenue reporting your credit scores
to companies evaluating your credit worthiness to buy their products and
services. They also make money by selling your credit information to
other companies and individuals requesting this information, even though
you never gave them permission to do this.
They have no obligation to ensure your credit information on their
reports is accurate and over 80% of the time the information is
inaccurate, often times grossly inaccurate. They will not correct this
information unless requested by you and then constantly followed up by
you..
3). Can I correct this information myself or do I need an attorney?
You can possibly correct this information by yourself if you have the
time and patience and persistence to constantly follow-up with all three
of the credit bureaus. They do not work together and most often each one
has very different credit information about you. Our observation has
been that this process for an individual can take up to one year,
without any guarantee all your reports will be absolutely accurate at
that time.
Security Pacific Financial retains law firms that specialize solely in
this area of law and have successfully litigated against the credit
bureaus in class action lawsuits. Attorneys are exempt from any
restrictions imposed by credit services organization laws, they can
communicate on your behalf and they do not experience the oppressive
resistance credit reporting companies express towards individual
consumers.
4). Are your services considered credit repair services?
No, companies that practiced “credit repair” used illegal techniques to
flood the credit reporting companies with frivolous and irrelevant
disputes in the hopes the volume of these disputes would cause the
credit reporting companies to remove accurately reported credit
information. Laws were enacted called Credit Services Organization
Acts, which effectively put all credit repair companies out of business.
The attorneys for Security Pacific Financial dispute the usual abundance
of erroneous information that shouldn’t appear on credit reports. This
negative information is misleading and derogatory and results in the
frustration and embarrassment of credit denial or much higher interest
rates on loans than you actually deserve.
5). Will improving my credit score allow me to receive a loan with a
favorable rate in a reasonable time frame?
Our experience has been that our clients, on average, improve their
credit scores by 70 to 100 points in a three to four month time frame.
Individual circumstance can vary if there are unusual conditions. That
type of improvement can save a consumer one to three percent in
annualized interest rates on a new home purchase or refinance resulting
in thousands of dollars in savings over the life of a loan. In addition,
other credit requirements: student loans, car purchases, credit cards
and lines of credit benefit greatly from improved credit scores.
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