Credit scores becoming way important for all of us

[Ramhock]

 

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Or think you know.

 

 

 

Impact credit cards:

 

- If the balance is $1 - 30% of the credit line = your FICO improves

 

- 30% - 50% or $0 = no impact

 

- 50%+ = decreases

 

 

 

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Pay your medical collections!!

[Ursa Majoris]

Too much (whatever that is) revolving credit, even unused = bad

[Ursa Majoris]

CCs older than 5 years = good

[MuddyPaws]

using credit cards monthly and paying off better than just collecting dust

[i_am_the_swammi]

1. Never close credit cards you have paid off. It will appear to the naked eye only that the account was closed. No reason will be given to those viewing the account.

 

2. Another reason to leave them open: you want your ratio for of debt-to-credit-available to be as low as possible.

 

Example: Suppose you have $3000 of debt on your only credit card (which as a max of $5000).You would have a debt ratio of 60% (3000/5000), which is very high and would lower your credit score.

 

But suppose you had three credit cards, each with a $5000 limit, but still just had that $3000 of debt. Your debt ratio would only be 20% (3000/15000), and your score would be much higher.

 

3. Always pay on time.

[keggerz]

3. Always pay on time.

and more then minimum...even if its just .01 more it gets reported as paid more then minimum

[polksalet]

FICO scores can go to hell. Four more years and mine will be at zero. I fail to see the logic of going into debt so I can go further into debt. This is the greatest scam ever perpetrated on the American people.

[Chavez]

FICO scores can go to hell. Four more years and mine will be at zero. I fail to see the logic of going into debt so I can go further into debt. This is the greatest scam ever perpetrated on the American people.

Your auto insurance will go up.

[jaxfactor]

3. Always pay on time.

 

And on that note, if mailing payment mail at least 2 weeks before it is due. I had it happen once when I mailed it a week in advance that the payment was late. If their mailroom workers are slow, that's too bad. You get the bad rap for it.

[Avernus]

if you're still in the process of moving around and setting up for your future home, then instead of using your home as your mailing address, open up a PO Box address and this way it doesn't show your mailing address as being this, that and the other location..

[keggerz]

And on that note, if mailing payment mail at least 2 weeks before it is due. I had it happen once when I mailed it a week in advance that the payment was late. If their mailroom workers are slow, that's too bad. You get the bad rap for it.

i cant remember the last time i mailed a CC payment....i have been paying them online for years

[polksalet]

Your auto insurance will go up.

 

do you have a link for this?

[Chavez]

do you have a link for this?

Been under a rock or something?

 

If your credit report is blemished, you might not get the lowest insurance rates, despite your spotless driving record. And as a result of a Supreme Court decision last week, your insurer doesn't have to tell you that you're not getting the best rates.

 

The high court overturned a 9th Circuit Court of Appeals ruling that said the federal Fair Credit Reporting Act requires insurers to notify customers whenever their credit history prevents them from getting the best available rate.

 

Insurers argued that credit histories are just one of many factors they use to set rates. They also contended that the ruling would have required insurers to send out millions of notices to customers to avoid costly class-action lawsuits.

 

For about a decade, most insurers have considered a customer's credit history when setting rates, says Joseph Annotti, a spokesman for the Property Casualty Insurers Association of America. Annotti says research has shown that drivers with poor credit are more likely to file insurance claims.

 

http://www.iii.org/media/hottopics/insurance/creditscoring/

An insurance score is a numerical ranking based on a person’s credit history. Actuarial studies show that how a person manages his or her financial affairs, which is what an insurance score indicates, is a good predictor of insurance claims. Insurance scores are used to help insurers differentiate between lower and higher insurance risks and thus charge a premium equal to the risk they are assuming. Statistically, people who have a poor insurance score are more likely to file a claim.

 

http://personalinsure.about.com/od/whattoe...a/aa041206a.htm

 

Credit scoring, the term used by insurance companies to rate your credit, has been a disaster for some consumers. Most insurance companies are now basing the cost of your insurance policy on your credit score. Missing as little as two payments on credit cards or other financial obligations could lead to your insurance premium possibly doubling. If your credit score is bad you could pay more when getting an insurance quote. And, regardless of the time you have been with your insurance company or your loss history, a low credit score could lead to a higher insurance premium or possible loss of your policy.

 

Many are asking, "What does one's credit rating or credit score have to do with their insurance policy premium or insurance quote?" The answer may surprise you. Insurance companies feel that if you are not responsible with your money, then you are more than likely not going to be responsible on the road. According to his recent statement to CBS, Donald Hanson of the National Association of Independent Insurers agrees. Hanson stated, "Research indicates that people who manage their personal finances responsibly tend to manage other important aspects of their life with that same level of responsibility and that would include being responsible behind the wheel of their car or being responsible in maintaining their home."

Edited March 22, 2008 by Chavez

[TimC]

It's okay, Polk. If FICO scores are the biggest scam, then insurance is the 2nd biggest scam.

[Chavez]

It's okay, Polk. If FICO scores are the biggest scam, then insurance is the 2nd biggest scam.

No doubt smart fellers like you and polk run around sans car, home, and health insurance.

[polksalet]

No doubt smart fellers like you and polk run around sans car, home, and health insurance.

 

K beer boy, read then quote. What is your credit is not blemished, what if you have none? If you have no credit for 7 years you score is zero.

 

Link please

[Chavez]

K beer boy, read then quote. What is your credit is not blemished, what if you have none? If you have no credit for 7 years you score is zero.

I'm not an actuary for an auto insurance company. But seeing as the above says that they see POOR credit scores as an indicator of carelessness, I'm not sure if they'd view NO credit score as a massive risk due to the person being a complete unknown, or a terrific client due to their conscientiousness with their money.

 

Call your insurance company and find out.

 

EDIT - knowing pretty much any adult American's familiarity with insurance companies, make a guess what they will do if a key indicating factor doesn't exist in regards to a client paying LESS or MORE.

Edited March 23, 2008 by Chavez

[godtomsatan]

There are all kinds of factors that go into car insurance premiums that have absolutely nothing to do with the ability to operate a vehicle.

[The Holy Roller]

It's okay, Polk. If FICO scores are the biggest scam, then insurance is the 2nd biggest scam.

 

Most true.