Dave "The Credit Fixer"

Your credit score isn't just a random number. Credit scoring models evaluate information in your credit reports to estimate how likely you are to repay borrowed money. While different scoring models can calculate scores differently, understanding the major categories that influence your credit can help you focus on the areas that matter. Here are 5 major factors you should understand about your credit score. 1. Payment History Your payment history is extremely important. Lenders want to know whether you've paid your accounts as agreed. Late payments, collections, charge-offs, and other negative payment information can potentially affect your credit profile. That's why one of the simplest rules for building stronger credit is: Pay every account on time. Consider automatic payments or reminders so an overlooked bill doesn't become a late payment. And remember — being just a few days late with a creditor isn't necessarily the same thing as having a 30-day lat...

  Credit utilization is one of the most important parts of your credit profile, yet many consumers don't fully understand how it works. You can make every payment on time and still have your credit scores affected by high credit card balances. The reason is credit utilization . Here are 7 things you should understand about credit utilization and how to manage it. 1. What Is Credit Utilization? Credit utilization measures how much of your available revolving credit you're currently using. For example, suppose you have a credit card with: Credit Limit: $10,000 Reported Balance: $2,000 Your utilization on that card is: $2,000 ÷ $10,000 = 20% utilization The higher the percentage, the more of your available revolving credit you're using. 2. Both Individual Card and Overall Utilization Matter Don't only look at the combined balances of all your credit cards. Credit scoring models can consider utilization on individual revolving accounts as well as your overall ...

  Credit inquiries can be confusing because not every time someone checks your credit affects your credit score the same way. The important distinction is whether the credit check is considered a hard inquiry or a soft inquiry . Here are 7 things you should understand. 1. What Is a Soft Inquiry? A soft inquiry generally occurs when your credit information is reviewed for purposes that aren't connected to a new application for credit. Checking your own credit is generally considered a soft inquiry. Soft inquiries may also occur with certain prequalification offers, account reviews, or other permitted credit-report checks. Soft inquiries generally do not affect your credit scores . 2. What Is a Hard Inquiry? A hard inquiry generally occurs when a lender checks your credit because you've applied for financing or another form of credit. Examples may include applying for a: Credit card Auto loan Mortgage Personal loan Business financing A hard inquiry may affect you...

  Your credit score can play an important role when you're applying for a credit card, vehicle loan, mortgage, or other financing. But many people focus only on the number without understanding what information is actually affecting that number. Credit-scoring models can differ, but several major parts of your credit profile commonly influence your scores. Here are 7 things you should understand about what affects your credit score. 1. Payment History Matters Your payment history can be one of the most important parts of your credit profile. Late payments, collections, charge-offs, and other negative payment information may affect your scores. Making your payments on time and keeping your accounts current can help you build a stronger payment history. One missed payment can potentially remain on your credit report for years, so don't wait until an account is seriously past due before taking action. 2. Credit Card Balances Can Affect Your Scores How much revolving cred...

  Finding information on your credit report that is inaccurate, incomplete, or doesn't belong to you can be frustrating. The good news is that consumers have rights when it comes to inaccurate credit reporting. If something on your credit report is wrong, you can dispute the information and request that it be investigated. Here are 7 steps to help you understand the credit dispute process. 1. Review All Three Credit Reports Start by carefully reviewing your credit reports from Experian, Equifax, and TransUnion. Don't look only at your credit score. Review the actual information being reported, including: Accounts Balances Payment history Collections Public records Personal information Account opening dates Credit inquiries An error may appear on one credit report but not the others, so reviewing all three can be important. 2. Identify Exactly What You Believe Is Inaccurate Before submitting a dispute, determine exactly what information you believe is wrong. For...

  One of the most common questions people ask about credit is: “How long is this going to stay on my credit report?” The answer depends on the type of information being reported. Negative information does not necessarily remain forever, and different types of information can have different reporting periods. Here are some of the most common examples. 1. Late Payments Late payments can generally remain on a credit report for up to seven years from the date of the delinquency. Paying the account current doesn't necessarily erase the previous late-payment history, although keeping the account current can prevent additional late payments from being reported. 2. Collection Accounts Collection accounts can generally be reported for approximately seven years from the delinquency that led to the collection. Selling or transferring a debt to another collection company does not restart the credit-reporting period. That's an important distinction because the age of the collecti...

  A lot of people avoid checking their own credit because they're afraid it will lower their credit score. Fortunately, checking your own credit is generally considered a soft inquiry , not a hard inquiry, and does not hurt your credit scores. Understanding the difference between soft and hard inquiries can help you monitor your credit without unnecessarily worrying about your score. 1. What Is a Soft Inquiry? A soft inquiry can occur when you check your own credit or when your credit information is reviewed for certain purposes that aren't applications for new credit. Soft inquiries generally do not affect your credit scores . That means regularly reviewing your own credit doesn't cause your score to drop simply because you looked at it. 2. What Is a Hard Inquiry? A hard inquiry generally occurs when a lender checks your credit in connection with an application for credit. Examples may include applying for a: Credit card Auto loan Mortgage Personal loan Othe...

  Credit utilization can play an important role in your credit scores, but there's a lot of confusion about how it actually works. You've probably heard that you should “keep your credit cards below 30%.” That's a useful warning against high balances, but 30% isn't a magic number where your credit suddenly becomes good or bad. Here's what you should understand. 1. What Is Credit Utilization? Credit utilization compares the revolving credit you're currently using with the credit available to you. For example, if a credit card has a $10,000 limit and a $2,000 reported balance, that card has 20% utilization. The calculation is: Balance ÷ Credit Limit × 100 = Utilization Percentage 2. Is Staying Under 30% Enough? Keeping utilization below 30% is commonly recommended, but that doesn't necessarily mean 29% is ideal. Generally, lower utilization can be better for credit scoring than higher utilization, assuming the rest of the credit profile remains the ...

  Many people assume that once they pay a collection account, it will automatically disappear from their credit report. Unfortunately, paying a collection and removing a collection from your credit report are two different things. Before paying or disputing a collection, it helps to understand exactly what is being reported. 1. Paying the Collection Doesn't Automatically Delete It Paying a legitimate collection generally changes the account's balance or status to reflect that it has been paid or satisfied. It does not automatically require the credit reporting agencies to delete accurate information from your credit report. A collection can generally remain on a credit report for approximately seven years from the delinquency that led to the collection. 2. “Paid” and “Deleted” Are Not the Same Thing If a collection is paid but remains on your report, a lender reviewing the report may still be able to see that the collection occurred. However, the effect of a paid collect...

Thinking about applying for a loan or credit card? Before you hit that application button, it can be worth taking some time to look at your credit first. Lenders may use information from your credit reports and credit scores, along with income and other factors, when deciding whether to approve you and what terms to offer. Preparing before you apply may help you avoid surprises and put yourself in a better position when seeking financing. 1. Review Your Credit Reports Start by reviewing your credit reports. Look at the accounts being reported, balances, payment history, inquiries, collections, and other information. Don't assume everything being reported is correct just because it appears on a credit report. If you find information that you believe is inaccurate or doesn't belong to you, investigate it and determine whether it should be disputed. 2. Pay Attention to Your Credit Card Balances Your balances compared with your available credit can affect credit scoring. Thi...