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Good credit history in today's society is a must
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More from Homes StoriesCredit history has become a major factor in determining our financial worth. Our purchasing power and the interest rate charged to us is greatly increased or diminished if the credit history reflects a favorable or an unfavorable history of our past borrowing habits. It can impact things we do everyday such as getting hired for a job, renting an apartment or a house, purchasing a large ticket item like a car or a home, etc.
In the past, many derogatory credit items could be explained. However, in today's automated world, every move we make is deeply analyzed and assigned a score by complicated computer programs. Credit engines constantly are watching our everyday purchases and the likelihood of us being late more than 90 days is monitored. Monthly payments that are more than 90 days late are viewed as being the first step towards a bankruptcy.
The credit score or FICO which is most commonly used scoring system, ranges from 300 to 850. The number we are assigned determines our credit worthiness and therefore it affects the interest rate we can obtain from financial institutions.
With the credit crunch problems in the forefront of the economy, a good credit score is even more important than ever. I believe it is to our best advantage to learn as much as we can about what impacts our credit score and what can we do to avoid costly credit mistakes. Also find out ways to raise and maintain a high credit score.
You can obtain a free annual copy of your credit report from the three credit bureaus, Experian, TtransUnion, and Equifax by visiting http://www.freecreditreport.com. Review it closely to make sure there are no mistakes.
If you find any errors, you should dispute them immediately with all the three credit bureaus.
The simplest solution to all the credit problems is the good old advice of our parents, "Don't buy it if you can't afford it."
(Faye Miran has been in residential lending for the past 17 years. For more information on credit and how to avoid costly credit mistakes log on to the Web site http://www.trustedmortgageloans.com.)
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