How long does a bankruptcy claim stay on your record?
Correct Answer: 10 years
Having a bankruptcy claim on your record will do serious damage to your ability to obtain a credit card or a mortgage for 10 years. Before declaring bankruptcy, you should examine a number of loan packages and legitimate credit counseling services that can provide assistance towards meeting financial obligations. Poor credit can severely impact your quality of life. It could result in higher interest payments, and not being able to obtain a loan or buy a house, marketing companies for lawyers. Poor credit could even keep you from getting a job because many employers check credit history
What is the biggest factor in determining your credit rating with banks?
Amount of debt
Correct Answer: FICO score
Your credit rating is actually a number determined through a formula developed by the Fair Isaac Corporation (your FICO score). Most credit card companies and lenders utilized your FICO score to determine you eligibility for a loan as well as the interest rate you are charged. More than any other factor, this score can determine both whether you get a loan and how much you pay. Having a low FICO score can cost over $6,500 in extra interest payments on a loan for a $20,000 car.
Which is most likely to improve your credit rating?
Opening new credit accounts
Spreading debt over many credit cards
Not missing payments
Keep balances low on credit cards
Correct Answer: Not missing payments
Improving your credit score can lead to lower interest rates on home mortgages and credit cards, and lower car insurance costs. In order to most effectively limprove your credit, understand what makes up your credit score. Your credit score is comprised of: your payment history (35%), amount of your outstanding debts (30%), the length of your credit history (15%), the amount of new credit you have (10%), and the type of credit you have (10%). Not missing payments will do the most to improve your credit. While most people think that opening new credit accounts in order to have a large amount of available credit is helpful, this could actually lower your credit score. In addition, having small balances on a large number of cards could be seen as a bad sign.
What percentage of credit reports contain errors?
Correct Answer: 80%
Your credit score can affect how much you pay for mortgages, loans, car insurance, and even whether or not you get an apartment. The vast majority of credit reports contain errors, and 25%of these errors were serious enough to potentially cause someone to be denied a loan. One of the most effective and simplest steps you can take to improving your credit rating is to get a copy of your credit report and correct any errors before they cost you money.