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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsCredit score a mystery to many consumers
By Susan Tompor
Detroit Free Press
Is someones age going to stop them from getting a top-notch credit score? Will whether youre married, divorced or single be figured into the calculation of a credit score? Does race influence the score?
Far too many consumers give the wrong answer and say Yes to those questions. Many incorrectly believe that a persons age, marital status or ethnicity can boost or ding a credit score, according to a survey of consumer knowledge of credit scores.
Whys that a problem?
These consumers may well think its not worth the effort to improve their credit scores, said Stephen Brobeck, the executive director of the Consumer Federation of America.
He may have a point. If you think factors beyond your control heavily influence credit scores, you may not be as diligent about paying bills on time.
Read more here: http://www.miamiherald.com/2012/05/26/2818479/credit-score-a-mystery-to-many.html#storylink=misearch#storylink=cpy
L0oniX
(31,493 posts)and then pay them no later than 5 days before the due date. Keep it up and you will see your credit score continue to increase. Don't get too many cards!
Mosby
(16,311 posts)It's not like the credit score companies publish the algorithms used to calculate scores.
Frankly there should not be major differences for secured credit rates like home loans, it's just a way to make more money off of lower income folks.
Initech
(100,076 posts)And those sites like "Free" Credit Score don't really help things.
unblock
(52,227 posts)well, they don't specifically look at your date of birth, but they certainly do look at how long you've had credit and how many credit inquiries you've made recently.
so how are you supposed to have your average credit card for more than 15 years if you're just 21 years old?
hmm, maybe i should apply for a card in mini-unblock's name. his fellow kindergartners will be so jealous!
CreekDog
(46,192 posts)others unrelated to you.
i had a long running home equity line of credit which i was well qualified for that i never used.
Bank of America bought Countrywide and then closed my account. DING.
lowered score for closing a longtime account.
BS like that.
unblock
(52,227 posts)why on earth should i have to PAY to monitor bogus information supplied by others at the credit bureaus?
yes, i can theoretically escape this if i wait until i apply for new credit and am rejected, then i can get a free credit pull by mail. but that's obviously inconvenient, time-consuming, and potentially a disaster if i'm, say, house-hunting.
if anything, merchants and credit bureaus should pay ME for the inconvenience.
the whole closing of accounts is problematic in many ways. if a credit card company gives me lousy service, i want to be able to threaten them with closing the account and taking my business elsewhere. why should i have to take a credit score ding for that?
mfcorey1
(11,001 posts)CreekDog
(46,192 posts)sorry. no sale.
mfcorey1
(11,001 posts)CreekDog
(46,192 posts)One's score isn't free.
How one's score is calculated is not only secret, but it's BS. As pointed out, it means that factors and people beyond one's own control can reduce their credit score.
mfcorey1
(11,001 posts)winstars
(4,220 posts)the "free credit report" band commercials and don't know that the REAL ONE TO GET IS: http://www.annualcreditreport.com .... You never mentioned getting "SCORES"!!! Scores don't matter at first, get all 3 credit reports (Experian, Equifax and TransUnion) from the above link WITHOUT SCORES. If you have lots of "baddies", your score will suck, a couple or few "baddies", you will have a middle to low score, one "baddie" or so, your score will be good and NO 'baddies", you will have an excellent score... Don't waste your money for any scores until you know what your reports look like. Then do credit repair and then get your scores later. If you get your reports and they are great, THEN pay for scores.. until then the above rule of thumb works...
Or if you want to pay to get REAL FICO score and reports, go to http://www.myfico.com to buy your Equifax and/or TransUnion FICO scores and reports. You can get the same Equifax report and score from the Equifax site but its very tricky to find there.
All other scores on the internets are FAKO scores and reports from any other source other than the above are bogus, even the scores that you can all so easily buy from Experian, Equifax and TransUnion are BS. But the reports from the 3 credit reporting agencies above are complete and have real reports numbers to use in credit repair...
If you want to do "credit repair" you need real reports with real report numbers to dispute with the 3 credit reporting agencies.
A great website to educate yourself to help yourself and your family is: http://www.creditboards.com the CREDIT forum rocks, also http://www.myfico.com also has a good forum/community for credit repair.
Its a complicated subject and people being "hard rocks" around here don't help!!!
Thanks for your help mfcorey1...
high density
(13,397 posts)Everybody starts off with no score and then it builds as you successfully make payments on a loan... I don't know how you can fix that. You need a payment history for a score.
unblock
(52,227 posts)saying that people are "wrong" because they thing that age is a factor. it's not a direct factor, but it is an indirect factor, because some of the things a credit bureau would want to (length of payment history, length of credit lines, e.g.) are logically correlated with age.
zeemike
(18,998 posts)It's simple....the more factors they use the easier it is to lower the score....lower score you pay more...
And the system is meant to squeeze as much out of you as you can bear.
99% of a credit agency's income comes from lenders.
Lenders make more when rates are higher.
Lower overall scores mean higher rates.
This is not a complicated scam at all.
demtenjeep
(31,997 posts)Age
time at address
Age of Auto
car payment
housing cost
checking and savings account
finance company references
major credit cards
ratio of debt income
declared bankruptcy
Honeycombe8
(37,648 posts)It's one of the biggest.
Also, foreclosure.
I don't think the credit cos. know your income, do they?
Ratio of debt to SOMETHING, though, is taken into account.
winstars
(4,220 posts)Debt to income ratio, DTI, counts in getting credit on a car or getting a mortgage for example...
What counts (amongst many factors) is credit utilization, which is how much of your available credit your are using. On credit cards pay all your cards of except one each month and on that one keep the balance under 10%... 6% is considered the "sweet spot" by some..
FreeJoe
(1,039 posts)Where did you find it?
A quick Google search shows these to be the factors used in credit scores:
1) Payment history
2) Amounts owed
3) Length of credit history
4) New credit (or inquiries)
5) Types of credit
You credit score is only based on information in your credit report. That doesn't include age, housing cost, bank accounts, or your income. A lender may ask about those things, but they aren't part of your credit score.
The credit score people's site is here: http://www.myfico.com/crediteducation/whatsinyourscore.aspx
demtenjeep
(31,997 posts)it is directly from the credit score institutions. It is what is taught in Financial Literacy
the reference letters mean payment on time ect.
wendylaroux
(2,925 posts)leave 50.00 in it,never touch it.we got a loan not from the used account,from the unused,perfect account.
Honeycombe8
(37,648 posts)FreeJoe
(1,039 posts)A checking account is not a line of credit. The credit agencies won't know about it and it won't be a factor in your credit score.
IDemo
(16,926 posts)The house was paid off years ago, haven't purchased a new vehicle since '93, no credit card debt and no major purchases on the horizon. I see no reason to get worked up about a completely bogus number someone has cooked up to score my consumer worthiness.
Honeycombe8
(37,648 posts)and credit is often checked by potential new employers. Although these sorts of things - it may matter only if you have a bad credit score.
hunter
(38,312 posts)Think of everything we've accomplished, man. Out these windows, we will view the collapse of financial history. One step closer to economic equilibrium...