Important questions to ask when shopping for a credit card

cards1 Important questions to ask when shopping for a credit cardWhat is the annual percentage rate, or APR?
How long will that APR last?
What is the penalty fee for a late payment, and what is considered late?
What is the penalty rate?
Will there be an annual fee?
Are there any other fees such as account termination fees or balance-transfer fees?
Can I pay my bill online?

5 Easy Tips for Using a Credit Card Responsibly

1) Know the rules (terms, conditions, interest rate, etc).
2) Have your own rules for using the card.
3) Use a card, pay the balance.
4) Don’t just make minimum payments.
5) Don’t get a credit card solely for the promotional prizes or points.

College Students and Credit Cards

Student Credit Card College Students and Credit CardsYour college years are the perfect time to establish good credit.  Credit cards are also an indisputable fact of college life and there are many good reasons a student should have one. To name a few, a credit card gives you protection for your school purchases such as books and food, a credit card allows you to shop online accessing more information and products that college may require, and a credit card provides a cushion in case of emergencies.

Unfortunately, since many young people typically lack credit history, college students may often find it hard to get approved when they apply for a traditional credit card. Luckily, student credit cards exist for such circumstances.

Learning how to use a credit card responsibly now can save you from having to dig yourself out of debt after you graduate from college. It also helps prevent you from having a bad credit history in the future that will affect other things you want to do.

 

What is a Credit Score Range?

credit score What is a Credit Score Range?

So you know your credit score, now what?  Like all other scoring models, credit scores have a range.  Your credit score range may be different from one institution to another as the scoring system used by all three credit bureaus are different. For instance:

        • Equifax : Fair Isaac Scoring Model
        • Experian : PLUS Score
        • Trans Union : Classic FICO Risk Score

Until recently the three leading bureaus above have agreed on using a collaborated new scoring model called Vantage Score which uses a number range (501 to 990), which is different from FICO score (that uses a scale of between 300 to 850).   The best-known and most widely used credit score model in the US is the FICO (Fair Isaac Corporation) Score.

Here is MyCreditFinder.com’s credit score range breakdown:

Excellent Credit

  • Credit score above 750
  • Very low credit risk
  • Long credit history
  • Multiple established credit and loan accounts
  • Credit accounts paid on time each month
  • Qualifies you for some of the lowest rates

Good Credit

  • Credit score between 700 and 750
  • Low credit risk
  • May have had late payments in the past
  • All accounts are currently paid on time
  • Standard amount of credit card debt
  • Qualifies you for competitive interest rates and terms

Fair Credit

  • Credit score between 650 and 700
  • Moderate credit risk
  • May have older negative public records
  • May have higher credit card debt balances
  • May have too many applications for new credit
  • Qualifies you for decent rates, but not the best available

Bad Credit

  • Credit score between 600 and 650
  • High credit risk
  • May have of high amounts of credit card debt
  • May have late payments, collections, or bankruptcy records
  • Difficult to be approved for standard credit products

Very Bad Credit

  • Credit score below 600
  • Very high credit risk
  • Late payments, collection accounts, or public records
  • Excessive applications for new credit
  • Very high amounts of credit card debt
  • Very difficult to be approved for new credit without a co-signer or down payment

No Credit

  • No credit score
  • Considered a high credit risk by lenders
  • Have not been using credit cards and loans regularly
  • May be trying to open a first credit account
  • Better than having very bad credit
  • Qualifies you to be approved for accounts tailored to people with no credit or bad credit

What can I do to improve my credit score?

helpful tips What can I do to improve my credit score?If you apply and are denied credit due to a low credit score, you have the legal right to be told by your creditor exactly why you were denied. Reasons for this could range from having too much outstanding debt, having too many open credit accounts to a balance that is too close to your credit limit.  You are also legally entitled to a free copy of your credit report from the credit-reporting agency that was used. Once you receive your credit report, take the time study it, find out what factors are weakening your credit and work to improve on them. Here are a few simple pointers:

1) Look for mistakes in your credit report. Getting rid of inaccurate information can sometimes improve your score dramatically.

2) Reduce the balances on credit cards to 75% or less of your available credit (25% is preferable).

3) Maintain your accounts for longer.  The ratio of your debt to credit limit is critical in calculating your credit score.  Closing old accounts only raises this ratio – which you don’t want to do. Some people have moved debt from several credit cards to one card and then closed the old accounts. Since creditors look at the debt-to-credit limit ratio this can have a bad affect on your credit score because you have the same amount of debt but less available credit. So don’t close old credit card accounts just because you’re not using them. Creditors also look at the average age of your accounts so, again, keep those old accounts.  If you want to raise your credit score, do NOT apply for any new credit cards or loans.

Finding out someone else’s credit score

card2 Finding out someone elses credit scoreFor a number of legal and privacy reasons, an individual cannot get a copy of another person’s credit report without permission. The federal Fair Credit Reporting Act (FCRA) specifies under what circumstances a credit report can be obtained and by whom.  Access to credit reports is restricted to businesses with a specific need, and to consumers who request their own report. You may get another person’s report if you have power of attorney or are the executor of an estate, or with permission.

Only businesses or individuals with a “permissible purpose” can access your credit report. “Permissible purpose” is defined in Section 604 of the Fair Credit Reporting Act (FCRA).  Examples of permissible purpose include:
-Accessing a credit report in connection with a credit transaction involving the consumer,
-For the underwriting of insurance involving the consumer,
-In connection with determining eligibility for a license or government benefit, or
-For a business transaction initiated by a consumer.

Lenders (with permission) typically get credit scores from the three main credit reporting agencies; Equifax, Experian, and Trans Union0.

What does my credit score need to be to get a credit card?

how to improve credit 300x169 What does my credit score need to be to get a credit card?The real answer isn’t one simple three-digit number, but rather a variable answer dependent on a number of factors. But, generally speaking, a credit score of 620 is the threashold for a new credit “rank”. If you’re credit score is below 620, or even 640, there’s a good chance you won’t be approved for most credit cards, though you may be able to get your hands on a credit card for “bad credit”. If your credit score is between 620 and 700, it’s a bit of a gamble as to whether you will be approved for a certain credit card. It’s generally safe to say you’ll be approved for most credit cards if your credit score is above 700, and you will likely need a credit score of 720 or greater to qualify for certain platinum cards or others that require “excellent credit”.

Remember, credit scores are also used to set credit card spending limits; so the higher the spending limit you are looking for, the higher your credit score will need to be.

What does my credit score mean?

Big3 What does my credit score mean?Your credit score is a measure of your past ability to make payments on time and manage your credit. Your credit score is designed to help lenders determine how likely you are to pay back your loan.  Your credit score is not concrete. It changes whenever you pay a bill on time or late, or if you apply for a new credit card or take out a loan. Your credit score is based on your credit history, and it attempts to predict what your credit behavior will be like in the future.

The three main credit reporting agencies are:

  1. Equifax
  2. Experian
  3. Trans Union

Your credit score is calculated using a formula created by Fair Isaac Corporation, which is why it’s also referred to as your FICO score.   Your FICO score may be different at each credit reporting agency, since the information they have on you may differ, or the statistical pool they are drawing from may be different. But they all use the same software to generate your score.

According to FICO, the five main factors that determine your credit score (and how they are weighed) are:

 1. The record of timely payment on loans (35%)

2. The types of debts and the total outstanding balance (30%)

3. The length of credit history (15%)

4. Types of credit used/The mix of credit accounts (10%)

5. Applications for new credit/Number and types of accounts opened recently (10%)

Below is MyCreditFinder.com’s simple breakdown of credit scores:

credit score2 What does my credit score mean?

Excellent Credit

  • Credit score above 800
  • Excellent credit risk
  • Long credit history
  • Multiple established credit and loan accounts
  • No negative public records
  • Qualifies you for the best deals

Very Good Credit

  • Credit score between 750 and 800
  • Very low credit risk
  • Credit accounts paid on time each month
  • Qualifies you for some of the lowest rates

Good Credit

  • Credit score between 700 and 750
  • Low credit risk
  • May have had late payments in the past
  • All accounts are currently paid on time
  • Standard amount of credit card debt
  • Qualifies you for competitive interest rates and terms

Fair Credit

  • Credit score between 650 and 700
  • Moderate credit risk
  • May have older negative public records
  • May have higher credit card debt balances
  • May have too many applications for new credit
  • Qualifies you for decent rates, but not the best available

Bad Credit

  • Credit score between 600 and 650
  • High credit risk
  • May have of high amounts of credit card debt
  • May have late payments, collections, or bankruptcy records
  • Difficult to be approved for standard credit products

Very Bad Credit

  • Credit score below 600
  • Very high credit risk
  • Late payments, collection accounts, or public records
  • Excessive applications for new credit
  • Very high amounts of credit card debt
  • Very difficult to be approved for new credit without a co-signer or down payment

No Credit

  • No credit score
  • Considered a high credit risk by lenders
  • Have not been using credit cards and loans regularly
  • May be trying to open a first credit account
  • Better than having very bad credit
  • Qualifies you to be approved for accounts tailored to people with no credit or bad credit

Welcome to MyCreditFinder.com

Welcome to MyCreditFinder.com, where you can easily find information about your credit, identify the right credit card for you, and quickly get on with your life!  MyCreditFinder.com helps you shop the largest credit card retailers for you, saving you time and money!