How is a Credit Scoring System Developed?

Most credit scoring systems are unique because they are based on a creditor's individual experiences with customers. To develop a system, a creditor will select a random sample of its customers and analyze it statistically to identify which characteristics of those customers could be used to demonstrate creditworthiness. Then, again using statistical methods, a creditor will weigh each of these factors based on how well each predicts who would be a good credit risk. For more information and to get your Credit Repair "DIY" kit go to www.credithelp21.com

Why is Credit Scoring Used?

In smaller communities, shopkeepers, bankers, and others who extend credit often knew by word of mouth who paid their debts and who did not. As some creditors became larger and as the number of their consumer credit applications grew, these creditors needed to establish more systematic and efficient methods for evaluating which consumers were good credit risks. Credit scoring is one such technique. Although smaller creditors still may rely on informal credit evaluations, many large companies now use formal credit scoring systems. Although no system is perfect, credit scoring systems can be at least as accurate as informal methods for granting credit -- and often are more so -- because they treat all applicants objectively. Get you "DIY" Do It Yourself Credit Repair Kit and more information at http://www.credithelp21.com/

Scoring for Your Credit!

How does a creditor decide whether to lend you money for such things as a new car or a home mortgage? Many creditors use a system called "credit scoring" to determine whether you are a good credit risk. Based on how well you score, a creditor may decide to extend credit to you or turn you down. The following questions and answers may help you understand who gets credit, and why. Get the questions and answers and your "DIY" Do It Yourself Credit Repair Kit at http://www.credithelp21.com/

What you Credit Score Means!

This rating system is meant to develop a snapshot of the risk you currently represent to a lender. Several parameters in your credit file, including length of credit history, number of open accounts, loans, mortgages, public records, and others are formulated to produce a 3-digit score between about 300 and 950. There are other scores used by lenders and insurance companies (some of which are developed by FICO) such as Application and Behavior scores. These other scores take other information into account. Usually a lender will use a combination of your credit score with other factors when determining your risk. They all have the same objective, to determine the borrower’s potential risk. Regardless of whether the score was generated by FICO or a system based on FICO parameters, they all yield an industry standard 3 digit score. This score places the borrower in one of 3 main categories. Get your "DIY" Do It Yourself Credit Repair Kit plus bounus gifts like (100 Part Time businesses and Instant Cashflow to name a few) go to http://www.credithelp21.com/

Happy Thanksgiving from Creditrepairman21!!!!

I am taking a few days off to spend with my family. I hope all of you have a Happy Thanksgiving and may God bless you and keep you save. Remember pay cash on Black Friday. :)

Creditrepairman21

Credit Cards Not Always Good for Your Credit, Part 2

The way the way the credit scoring module is set credit cards are just a part of how your credit score is established. That being said don’t believe that just because you get a credit card or two you score will go up 100 points in 30 days (don’t laugh I have seen this advertised on the internet) you need history ie… time. You need a mix see my blog 5 Factors of Credit http://creditrepair21.blogspot.com/2008/11/5-factors-of-credit-scoring.html
for the FICO scoring break down on how to mix up the credit you have and may want to get for the best possible scores. One last thing to remember, be responsible and pay your bills on time if you don’t you will kill your scores and have to start all over and creditors look at your history bad payment history means higher rates.

Credit Cards Not Always Good for Your Credit. Part 1

I know, I know you hear it all the time get credit cards to build/rebuild your credit. Well it is true that you need them for balancing the mix of credit on your report. I will tell you the same thing, but be responsible and keep the balance BELOW 30% of your available credit limit. This will help your credit score increase and stay up. Whenever you go over 50% of your available credit limit your scores start dropping, because red flags go up. Stay tune for part 2.

Managing your Credit and Credit Scores this Christmas!

So you have your credit report and your scores are lower than you had expected. Where do you start and how do you get your scores back up? Well the first thing to look at is have you had any late payments if so, no more late payments this will help your score to go up. This will take a time so make all payments before the due date to avoid late fees. If you have revolving credit (ie.credit cards) make sure you get the balances below 50% of your limit for your best credit score below 30% of you credit limit would be even better. Let say you have $1000.00 credit limit for you BEST credit score get your balance below $300.00. Go to
http://www.questgroup-usa.com/EBMS/Images/Templates/MortgagePal/General/DebtCalc.asp for a great free debt consolidation calculator. Remember if you can pay cash or debit for ALL your Christmas shopping and avoid those credit cards. If you do use them make sure no matter what you can pay them off or at least below 30% of your available credit limit.

Today I am taking a break from credit repair. :)

I will be back on 11/21/08 with a couple of blogs. I took time out today to take my 5 year old son to the zoo. Yes, I have a life :)

Creditrepairman21

What is the Credit Scoring Process? (Part 2)

What the credit scoring model seeks to qualify is how likely the consumer is to pay off their debt without being more than 90 days late on a payment at any time in the future. Credit scores can range between a low 300 to a high 900. The most common scores 400 low to 850 high. The higher the score the less likely the borrower will default on their loan. Approximately 1 out of 1300 people in the US has a credit score over 800. These borrowers get the best interest rate available in the market. On the other side of the spectrum 1 out of 8 borrowers are faced with the reality they may not qualify for a loan because their scores are between 500 low to 600 high. Which category do you fall in? Don’t go in blindly when looking for new credit get your FREE credit report at https://www.annualcreditreport.com/ for GREAT FREE finance calculators go to http://www.questgroup-usa.com/EBMS/Images/Templates/MortgagePal/General/Calculators.asp