Building Your Credit Score

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​Insider Secrets to Increasing your FICO Score

We're constantly hearing about credit scores, where to get a free credit report and there're are plenty of people out there that want our money to "fix" our score. The truth is that most of the time you can increase your credit score all by yourself, you just don't know what affects the score and you haven't been taught how to increase it. 

I'm going to show you what I have learned, why it works and how it has helped many people get their FICO score increased so that they were able to get lending on a home. You can put these things strategies to work right now and you may be able to increase your credit score in as little as 45-90 days.

Life isn't perfect and things like collections, bankruptcy's and judgments can happen and certainly do have a negative effect on a credit score. What people must understand is this - there are simple things that may be done to reduce and in some cases, reverse the damage that has been done to the credit score. ​

The first thing you need to do is obtain your credit report, the one with the 3 FICO scores. These are not the free reports you see online, since you need to see the 3 FICO scores you'll have to pay for it. There is a way to get your 3 bureau credit report with scores for Free, i will tell you how in a minute, for now just know you need the 3 bureau credit report with your FICO scores.

Once you have the report, go through it and verify everything that is on it is correct. Make sure all the accounts listed are your accounts, if anything looks odd then check up on it immediately. Your credit may have been hacked and ID stolen.

When your identity is stolen the perpetrators will usually open credit accounts in your name, obviously they won't pay the bills, so these show up as late payments and collections on your credit report. These are not too difficult to have removed, the key is to catching these fraudulent accounts quickly and notifying the creditors immediately. The creditors contact information is located towards the end of the report.

When your credit is reviewed during the home loan process the 3 FICO scores are only one part of the credit report. Here are other things that are reviewed:

• Late payments- these show up as 30 - 60 - 90+ days late
• The amount and type of credit available, the balances, the high limit, how long it has been opened and the terms
• Collection accounts - Type of credit, amount due and when it was reported deliquent
• Inquiries - looking at who's been offering you credit and how often
• Public records statements - Bankruptcy, Foreclosure, Judgments, Tax Liens

It's very important that you review these items for accuracy because it is fairly common for mistakes to happen.

Once you have verified all of the information and everything is correct, then it's time to concentrate on the 3 numbers that make up your FICO score. You have 3 credit scores produced from the following: Equifax, Trans Union and Experian, and they range from 350 - 850. Here's what affects the score and by how much, you'll also see how to gauge your score:

Two main things influence your score, so paying your bills on time and keeping your balances below their limits will help your FICO score. ​High credit card balances that are near their maximum credit limit are very common reasons for a credit score to come in low.

You probably don't know where it should be to keep your score from taking a "hit", Here's the answer - it's best not to exceed 50% of the high balance limit. This is an easy fix, unless your limits are high, then it may be costly.

I have also found that a lack of Good credit accounts can have a negative affect on your score. What I typically find is that by adding more credit accounts it will reflect a positive payment history and show that you have established credit, all of this means an increase in your credit score.

​Creditors like to see that you have debt, but not that it is paid off every month, which seems backwards and it is. Bottom line is that banks that extend credit want to make a profit and if you pay off the balance every month they don’t make any money.

Here's how to beat them at their own game - You simply need to get 2-3 credit cards (*Secured Cards if necessary) with about $200-300 balances will work. You will be charging a low amount so using $200-300 cards are perfect for this. The idea is to use these every month and only change $25 on each one, use them when getting gas or getting something little.

• The trick to maintaining the $25 balance every month is this: 1 week before the payment is due charge another $25 on the card(s)
• Pay the original $25 off from the statement and there will be another $25 balance.
• Doing this every month costs you very little in interest on the $25 that remains
• Doing this on 3 cards is best if you can get them, which most people can

*Secured credit cards are cards that you must put money down on, sort of like a bank account with the exception that payments are NOT auto deducted. The high balance limit is the amount you put towards the card.

Here is some information for secured credit cards:​
  -  Wells Fargo has secured credit cards with a low $200 balance and no annual fee.
  -  Open Sky doesn't pull your credit and they send a card out right away
  -  The women LOVE this one - Victoria Secrets also approves Credit for people with lower scores (below 570) and it is not a secured card! Be careful with this one ladies
   -   Link to more Secured Credit Card offers -  www.CreditCards.com

Please understand that adding more accounts may or may not be what you need, until I see your credit report I have no way of knowing how to help you raise your score. This is simply a way to show you what has worked for others and to show that you likely do not need to pay some company to "fix" your credit, more often than not they're simply taking your money.
Keep in mind that changes do take some time because the 3 agencies make updates at different time intervals, so 60-90 days is a common time frame to see the changes. And, depending on your situation, it could take up to 6 months to a year.

Collection Accounts
When obtaining a Home Loan, Medical collections do NOT need to be paid off. The government currently looks at it as a medical necessity should not affect you when wanting a home loan. 

Other accounts may or may not need to be paid off, this depends on the type of loan and the type of account that is in collections. There are different guidelines that state certain amounts are acceptable when left in collections, while others may require a payoff.

Student loans in collection will be required to be out of default, whether that be in the form of renegotiating a new payment arrangement, a settlement and payoff of the debt, or seeking to have the debt discharged (yes, there are certain conditions in which these debts may be forgiven/discharged).

Bankruptcy, Short Sales and Foreclosures all have a fixed time after the event that must have passed and depend on the Home Loan program being used. There is a "grey" area in regards to past Foreclosure and Deed-in-Lieu dates, so it's best to get with a KNOWLEDGEABLE Loan Professional to find out where you stand.

Judgments will almost always have to be paid off or put into a repayment program. When there is repayment program it will be necessary to show that there is a contract in place and that 3-6 payments have been made.
  

How you can obtain a Credit Report that shows all 3 FICO scores and doesn't cost you a dime if you can't get a home loan - 
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I am involved in All Things Real Estate, Right?
Well this also includes me being licensed as Mortgage Loan Originator for Fairway Independent Mortgage Corporation who is licensed to do lending in all 50 states.

With me, it's all about Service, Speed and Client Satisfaction. And, there are no application fees, there's no upfront charge for a Credit Report and there's none of those BS Origination fees charged. Only when you have successfully completed the home loan process and purchased a home using my services, will there will be an $80 Credit Report fee included in your lending costs. If I can't get you a home loan, there's no cost for the Credit Report, simple as that.
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If you'd like to read more about what I do at Fairway Independent Mortgage Corp simply click HERE and you'll be taken to my company page. If you'd like me to help you with your credit and the home loan process, I'm just a click away.

Would you like me to help you navigate the process of fixing your credit and raising your score? I have a special team set up that helps my clients repair their credit, at no charge to you of course, because I am always here to help you. The process starts by filling out a home loan application, this allows for a credit report to be pulled and reviewed. From there I will coordinate with my team and come up with a plan to help you re-establish your credit. 

yes, please help me with my credit