Get the Bad Debt Facts
Everyone should get the facts about their credit history and stay in tune with its progression during life. With advanced technology and cyber related criminal activity on the rise, it’s important we know the facts about our credit. If you are struggling with bad debt or subpar credit, knowing the facts can not only help maintain or improve your credit rating, but can help prevent identity fraud or bad debt incidents.
Knowing what the numbers mean
Typically, a FICO score of 750 or above is considered valuable. Fico scores range from 300-850. When someone is able to maintain a high credit score through life, it can potentially save them tens of thousands of dollars in annual percentage rates, help lower insurance premiums and assist with securing a home and job.
Bad debt can affect a credit score considerably, especially if left neglected. Tuning out collectors and avoiding the inevitable can lead to bad debt credit ratings of 600 or less. Some lenders wont’ consider giving a loan without a credit rating of at least 700. If you have bad debt and struggle with a less than perfect FICO score, hope is not lost. There are lending agencies available to work with consumers who need bad debt personal loans or consolidation loans to help dig out from under a financial problem.
Credit scores can produce confusion when considering FICO ratings, multiple reporting agencies and varying score tactics. Bad debt can follow a person to each credit bureau, so it is important to check all three agencies to determine the validity of a credit score.
There are three major credit bureaus that keep an updated file on our credit history: Experian, TransUnion, and Equifax. They can all keep tabs on your credit history. Any bad debt facts about your credit are given to reporting agencies, so you won’t be able to conceal bad credit habits or late payments. It’s important to learn from mistakes and improve your rating.
Agencies retrieve data from credit card companies, auto and home lenders and utilities, these records will provide future creditors a good idea of your credit worthiness. Every month, lenders notify the credit agencies with a report card of sorts. Credit reporting agencies keep the information collected up to date, which forms your credit rating. This includes data from your current credit and past payment history.
Debt facts are plain to see
Bankruptcy’s, charge-offs, closed accounts, collection accounts, inquiries (from the last two years), judgments, tax liens and late payments are all available on your credit report. Bad debt facts on your credit report also include the number of days you were delinquent on an account. Based on this information, lenders can decide whether or not to loan you money or issue a credit card. A federally mandated site called, AnnualCreditReport.com, can also help you keep up to date on your credit score.
The results of bad debt can follow you to the grave, so it is important to maintain a clean credit report. Your credit score can impact more than just auto and home loans – it can affect how much you pay for car insurance, whether or not you get a job and if you are eligible for discounts from lenders. Knowing your credit score and pulling your report won’t affect your score, only inquiries from creditors can decrease your rating. Knowing your score is key to reducing bad debt and keeping an eye on your overall rating to avoid identity theft.
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