Credit and Credit Scores: A short lesson

PokerFox · #1 12-27-2006, 02:12 AM

OK, So I have to give a short presentation to my bank about credit and credit scores as part of some team-building crap, who knows.

Anyways, I actually think my topic is useful and something people need to know, so I thought I'd share with a bunch of poker players who keep all their scrilla on Neteller.

There are 3 major credit reporting agencies, TransUnion, Experian, and Equifax. The 3 are all regarded as fairly accurate, however, there are discrepancies between the 3. You are entitled to 1 free credit report per year from each agency (obtainable at annualcreditreport.com), therefore, the smart consumer pulls his credit once every 4 months, each time from a different agency.

The big misconception is that checking your credit hurts your score. This is simply not true. There are 2 types of credit inquiries; soft and hard.

A soft inquiry is when you check your credit, such as your free credit report, or an employer pulls it for job purposes. These do NOT affect your credit at all and do not show up on your credit report.

A hard inquiry is when you apply for a credit card, loan, mortgage, etc. These will affect your credit if you are denied and especially if you continue to apply at other financial institutions and continue to get rejected.

The best way to maintain a good credit score is not having any 30+ day late payments, because they stay on your record for 7 years.

The best way to build credit, if you have none, is to get a CD and take out a loan against the CD, paying it off, establishing credit.

Anyone want to know anything about credit?! Manage it well and you'll be paying off that 30 year mortgage in no time.

Fox

Cubswin · #2 12-27-2006, 02:16 AM

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The best way to build credit, if you have none, is to get a CD and take out a loan against the CD, paying it off, establishing credit.

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huh?

Cubswin · #3 12-27-2006, 02:21 AM

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The best way to build credit, if you have none, is to have someone with great credit add you as an authorized user on one of their credit cards (preferably their oldest card with no delinquencies)

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___SK___ · #4 12-27-2006, 02:25 AM

whats the best way to rebuilding your credit?

PokerFox · #5 12-27-2006, 02:30 AM

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whats the best way to rebuilding your credit?

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Get yourself a credit card if yon don't still have one, and make all your payments on time, and unfortunately, wait. You can't get those 30+ late payments off of your credit report like I said. Don't use one of those credit repair clinics. All they do is offer to remove wrong or bad info from your credit report and you can do that yourself.

A S U · #6 12-27-2006, 11:57 AM

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Don't use one of those credit repair clinics. All they do is offer to remove wrong or bad info from your credit report and you can do that yourself.

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Could anyone explain how to do this yourself? Around 98-00 I got myself into some bad credit issues. I was in college and effed it bad. I had 2 CC's, one for like $500 and one for $700. Maxed them both out and never paid them off, they went to collections=My score suxs.

About 4-5 months ago, I got a crappy CC with an annual fee and a pretty high % rate with a line of $600. Then a month later I got a better one with no annual fee but a line of only $300, then about 2 weeks ago I got a Chase card with a great APR and $2100 line, so it appears to me that my credit is vastly improving. But I will always wonder about those 2 old CC's and how to get rid of that crap so I can get a really good score going. Thoughts?

CharlieDontSurf · #7 03-23-2007, 02:55 PM

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The best way to build credit, if you have none, is to have someone with great credit add you as an authorized user on one of their credit cards (preferably their oldest card with no delinquencies)

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is this true..just have my dad add me to one of his cc cards eventhough he lives in florida and i live in cali?
my credit blows..like 600 fica i think

BradleyT · #8 03-23-2007, 02:58 PM

Yes it's true. You don't even need a card or ever have to use it.

CharlieDontSurf · #9 03-23-2007, 03:12 PM

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Yes it's true. You don't even need a card or ever have to use it.

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so basically the only reason they are willing to add me ontpo the CC despite my score sucking is cuz his score is awesome?

PokerFox · #10 12-27-2006, 02:26 AM

[ QUOTE ]
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The best way to build credit, if you have none, is to get a CD and take out a loan against the CD, paying it off, establishing credit.

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huh?

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You deposit $5000 (arbitrary amount) into a 6 month Certificate of Deposit earning 6%. You go for a secured loan at a lower interest rate (may need a cosigner). You pay off the loan, and earn some small interest in the process, and increase your credit.