It is easy to find information concerning credit today, TV, Newspapers, and the internet are loaded with information, but sadly, much of that information is inaccurate. Here are just a few of some common credit myths circulating today:
(Now, you might think that sounds absurd, but I assure you it’s far more widespread than you think.) Your spouse and your credit report and scores are looked at individually. If you have joint accounts, they’ll show up on both your credit reports.
If you get an authorized user account for your spouse, that’ll also show up on your report. However, if none of your accounts are joint, and you don’t have any authorized user accounts, there will be nothing that will affect your score for one another.
Huge Myth! Your credit score, right now, is looked at for almost everything you do. Increasingly, when you’re applying for a job, they look at your credit score. When you’re applying for auto insurance (in most states), homeowner’s insurance, or life insurance, they look at your credit score, they look at your credit history.
That’s why it’s so important to clean your credit up. Make sure that your credit’s reporting accurate information. If you have derogatory credit that’s truly yours, you work to rebuild credit.
This credit myth could not be further from the truth! The truth is, there is only one payment per billing cycle that is reported to the credit bureaus from creditors.
Multiple payments or trying to split up payments so that it “looks like” there is more payment activity on an account can actually hurt the consumer, how…….a lot of times if a payment is due on the 10th of the month and partial payment is received on the 1st of the month and then a 2nd payment is received on the 15th of the month if the payment made on the 1st was equal to at least the minimum payment due there will be a late charge which will be charged to the account no matter how large payment is made on the 15th.
The best advice, make your payments once a month on Credit Cards, Installment Accounts, and Mortgages and pay them at the same time each month so you develop a habit of paying on time.
In order for your Credit Profile/Report to be accurate, the law states that there must be
These are the three thresholds that every item that they’re putting on a credit report must meet. If it doesn’t meet it, they must delete it.
FICO now competes with Vantage Score but Equifax, Experian, and TransUnion still offer both score options. This is partly because FICO is so widely used and accepted by commercial lenders and is the only credit scoring system recognized and used by the Federal Government when determining the credit worthiness of a consumer for a government-guaranteed loan.
The goal of the credit bureaus has been to wean users off the FICO model and start using Vantage Score instead due to the fact that the credit bureaus have to pay FICO a royalty each and every time a FICO score is pulled.
However, due to the overwhelming majority of lenders and credit issuer’s familiarity with the FICO model, the Vantage Score has not taken the credit world by storm as fast as the “Big 3” would have liked
All three credit bureaus now offer Vantage Score in addition to FICO score to calculate the credit scoring, instead of only offering FICO.
When using “programs” such as Credit Karma, and MyFreeCreditReport.com the consumer will think that they are looking at a FICO score, but in reality, what they are looking at is the Vantage Score generated by the credit bureau.
This by the way is designed to generate a higher score than a FICO score and in the opinion of this writer is done so on purpose to give a consumer a false sense of what his/her credit scoring really is.
In reality, it really makes no difference in credit score variations. Credit score variations are inevitable because the data the credit bureaus collect is still derived from different sources, not all data furnishers report their information to all of the credit reporting agencies.
So, the problem of varying credit scoring will not be solved by the new Vantage Score.
The three bureaus are branding the Vantage Score as something that will help banks and lenders further hone the subprime categories. Subprime lenders are those banks and lenders dedicated to borrowers with poor credit or harder-to-approve loans. Subprime loans have higher interest rates and fat lending fees.
In today’s credit-crunched economy, this is a fast-growing market and the credit bureaus are hoping to use that as a selling point for Vantage Score. Slick marketing!
Unlike FICO’s traditional 300 to 850 scale, the Vantage Score goes from 501 to 990. Here is a breakdown of the credit scoring with the respective rating:
As one can see, simply by virtue of the Vantage Score scale starting 351 points higher than the traditional FICO Score scale, a consumer may look at a Vantage Score of 680 and think that is a pretty good score, but in reality, that would equate to much lower FICO score. It can all get very confusing and unfortunately (in the opinion of this writer) that is exactly what the credit bureaus are going for.
For additional information and help regarding any credit issue please feel free to contact The ASCENT Network.
It is easy to find information concerning credit today, TV, Newspapers, and the internet are loaded with information, but sadly, much of that information is inaccurate. Here are just a few of some common credit myths circulating today: Credit Myth: “Your credit score only counts when you’re looking to borrow money.” Huge Myth! Your credit … Continued
Read MoreIn order for your Credit Profile/Report to be accurate, the law states that there must be These 3 Credit Report standards are: Third, The item must be verifiable. The item in question must be able to be verified by the credit bureau because they are the ones disseminating the information and by the creditor because … Continued
Read MoreFICO now competes with Vantage Score but Equifax, Experian, and TransUnion still offer both score options. This is partly because FICO is so widely used and accepted by commercial lenders and is the only credit scoring system recognized and used by the Federal Government when determining the credit worthiness of a consumer for a government-guaranteed … Continued
Read MoreWE COMMUNICATE WITH ALL THREE CREDIT BUREAUS FOR YOU:
