Climbing Out of The FICO Trap - How to Raise Your Credit Score
I sincerely hope that you are achieving success with your credit reports and are on your way to an A+ credit rating. Remember, cleaning up your credit is more of a marathon than a sprint. The rewards go to those who persevere.
If you are gearing up for a purchase requiring credit approval in the near future, then you already appreciate the importance of your credit score. This three-digit number LITERALLY DETERMINES OUR LIFESTYLE. It is often even MORE IMPORTANT than HOW MUCH MONEY WE MAKE!
A score below 620 can wreak havoc on your financial life. I like to call any score below 620 the “FICO TRAP.”
Lenders will laugh at you.
Employers may turn you away from jobs you are overly qualified for.
You might not even be able to rent an apartment.
If you do “beg” your way to getting new credit, it will no doubt be at a “stomach-turning” interest rate.
For most people, bad credit breeds more bad credit and they FAIL to climb out of the FICO TRAP - EVER.
On the other hand, if you are a little clever and motivated to improve your lifestyle with better credit, then it is NOT THAT HARD to achieve an excellent credit score - NO MATTER WHAT YOUR INCOME LEVEL IS.
You can groom and massage your credit score to a nice 720+ with some smarts and a little bit of discipline.
I promise that the rewards will be well worth it.
Specifically, once you reach this level, credit bureaus and banks will treat you like a rich person. You will enjoy high credit limits - which in turns improves your score even more. You will also begin to receive bonuses like low interest rates, rewards points, frequent flier miles, etc.
Have you ever flown in the first class section of an airplane? Having a great credit score will make you feel like you are sitting in the FIRST CLASS section - ALL THE TIME. (Your friends and neighbors will stare and wonder how you did it while they struggle just to get a ticket onto the plane!)
Specifically, the credit bureaus use a complex (and top secret) algorithm to calculate your credit score. Basically, a computer system takes all the information on your credit report - including payment history, types of accounts, balance, etc., and spits out a three digit number.
This number becomes the yardstick by which lenders, employers, and others see your creditworthiness. In fact, in most new credit transactions, a lender NEVER LOOKS AT ANYTHING OTHER THAN YOUR SCORE!
In effect, you are JUDGED SOLELY BY A THREE DIGIT NUMBER!
Credit Bureaus felt it was necessary to boil EVERYTHING down to a single number simply because they are inundated with processing data in our high paced, consumer driven society. (In fact, each
bureau manages 210 million files and updates more than 4 BILLION pieces of data each month!)
Some think it is unfair that the bureaus use a computerized system rather than a more personalized method. However, with a few techniques you can PLAY THE GAME and USE THE SYSTEM TO YOUR BENEFIT.
Specifically, the scoring formula gives weight to some factors more than others. In other words, some factors may greatly impact your score while others have little or no effect at all.
Some factors make NO SENSE AT ALL. For example, paying off an old collection account can lower your score - by a lot! This is totally contrary to common sense.
However, to play the game you must understand the rules.
If you are in the FICO TRAP and have a score under 620, then there are TWO THINGS that you MUST focus on.
FIRST - DELETE NEGATIVE INACCURATE ACCOUNTS. Derogatory credit items do the most damage to your score and should be removed entirely from your file AS SOON AS POSSIBLE.
(If you have questions about HOW TO DELETE NEGATIVES, then I suggest you give the lawyers at The Lexington Law Firm a ring - 1-888-585-3855. There is no pressure to buy anything and a paralegal will give you a consultation free of charge.)
SECOND - MAINTAIN AN UNSECURED REVOLVING LINE OF CREDIT. This is a simple technique that most ANYBODY CAN DO at the same time they are cleaning up negative items.
Although the actual credit scoring algorithm is a protected secret, a review of thousands of credit files indicates this to be ALMOST AS IMPORTANT AS REMOVING NEGATIVE CREDIT ITEMS!
Simply put, the credit bureaus will LOVE YOU if you keep an unsecured revolving line of credit open.
Again, common sense would tell you that a responsible borrower would close her open credit card accounts. However, the credit bureaus and banks have an incestuous type of relationship. Of course banks prefer you to keep accounts open and thus, bureaus in turn reward you for unsecured revolving credit lines.
Again, the goal here is to use the system and make it WORK FOR YOU. Specifically, an unsecured revolving line DOES MORE than just establish new good credit. It is like having a full time employee working on raising your credit score each month!
Here’s how:
1. AN UNSECURED REVOLVING CREDIT LINE ADDS A TRAIL OF POSITIVE PAYMENT - The bureaus like accounts to age. An unsecured revolving credit line gets older each month.
You can basically forget about it and it continues to age each month - in turn improving your payment history.
2. IMPROVES YOUR DEBT TO CREDIT RATIO - Bureaus reward people who have HIGH AVAILABLE BALANCES and LOW OUTSTANDING DEBT.
In other words, your goal is to have lots of unsecured available credit.
The long and difficult way to do this is by dutifully paying down large credit balances. However, it can take you YEARS to do this.
I of course encourage you to manage your debt wisely. However, there is a much more quick and painless way of improving your debt to available credit.
The SHORT AND SIMPLE method is to ADD an UNSECURED ACCOUNT with a HIGH CREDIT LIMIT. This is like beating the credit bureaus at their own game. (Some people have seen a rapid and BIG credit score jump by doing this).
The problem of course is to convince a bank to give you a new credit card with a high balance.
If you are in the “FICO TRAP” - it just ain’t gonna happen.
However, there is a new alternative for you to add a $5,000 or $10,000 unsecured revolving account - no matter what your salary level or credit score is.
It’s called the Ox Publishing Card and it has been quietly helping frustrated consumers improve their credit scores. The Ox Company doesn’t have the big egos that credit card companies have. You won’t find them advertising on television or making a fuss about how great they are.
In fact, the exact opposite is true. Thus far, the people at the Ox Card have “flown under the radar.” It has been a quiet little engine that continues to help people maximize their “Utilization Ratio”,
improve their credit score, and SAVE A TON OF MONEY.
The Ox Card provides you with either a $5,000 or $10,000 UNSECURED REVOLVING LINE OF CREDIT, that REPORTS TO THE CREDIT BUREAUS, without NO SALARY REQUIREMENTS, and GUARANTEED APPROVAL.
In sum, the Ox Card is a PERFECT TOOL for you if you want to:
1. Add a $5,000 or $10,000 unsecured line of credit to your credit bureau profiles.
2. INSTANTLY improve your debt to available credit ratio.
3. IMPROVE your credit score - REGARDLESS of the negative items that may or may not be on your credit reports.
Click Here to learn more about the Ox Card
By the way, here are some INSTANT SUCCESS STORIES from customers who discovered the power of the Ox Card:
“I just wanted to thank you for the Ox Card. Within only 20 days after making my ebook and music purchases, my credit score increased 35 points. It’s now been 60 days, and my score just keeps
improving.”
- John B.
“28 points and rising. You guys are awesome!”
- Bruce T.
Finally, unlike big corporate credit card companies, you can enjoy GUARANTEED APPROVAL with the Ox Card. In fact, YOU CHOOSE whether you want a $5,000 or $10,000 credit line.
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