Credit scoring is quickly becoming one of the most-discussed topics in the mortgage industry and lately it has come under attack by consumer groups and some members of Congress.

Some of the strongest attacks on credit scoring focus on consumers? Seeming inability to change the credit score so as to change a denial into an approval quickly enough to rescue a deal or to keep from having to pay a higher interest rate, since some mortgage loans are now priced according to the borrower’s credit score. Since the score is based on information – positive and negative – in a consumer’s credit report, incorrect information – especially if that information is derogatory as defined by the model – can lead to a lower-than- warranted score. But, with the system now in place, correcting and deleting negative and incorrect information can take weeks, and even after the information is corrected by the creditor in its own files, the creditor often takes weeks more to report, via magnetic tape, the new, more-positive information to the credit repository (of which there are three: Trans Union, Experian – formerly TRW – and Equifax, which dominates here in North Carolina). But congressional, regulatory, and consumer pressure are coming to bear on this cumbersome, paper-based “corrections” system. Recently a credit industry official told me the credit bureaus – which are local that sell reports compiled by the three large repositories and which have the most direct contact with consumers – are negotiating with the repositories to be able to help consumers make changes faster. Under the proposal, the local bureau would check out consumer complaints directly with the creditor and, if the creditor confirms that the information is, indeed, incorrect, the bureau will be able to change the so-called “raw” credit file directly with all three of the repositories without waiting for the creditor to check out the complaint, update its files, and then send the updated information to the repository. A process that, as I noted, can take weeks – long enough to kill a deal. This is a major development. With the raw file changed, a new, possibly higher, score can be quickly generated, a deal rescued, and consumer and congressional concerns can be addressed.

Additionally, the three repositories continue to attempt to cooperate with one another, in theory sharing any updated, corrected information about consumers to insure their files are as accurate as possible. (But, just to be safe, consumers should make corrections with all three repositories directly – don’t assume anything; they are, after all, competitors.) The three repositories each use a different version of the Fair, Isaacs scoring model, but the model has been adjusted and weighted, so, theoretically, if all three had the very same information on you, your three scores would be identical. (A score of 640 at one repository would represent the same odds as a 640 at either of the other repositories, according the Fair Isaacs.) Of course, not all creditors report to all three repositories, so, even with adjustments, consumers can sometimes end up with three quite-different scores. While it is true that, in theory, you can have great credit with one repository and bad credit with another, I have rarely, if ever, seen that happen, although I have seen some pretty wildly varying scores. In a few cases I have seen borrowers with scores that vary by 100 points or more. To combat this variance, the mortgage industry usually uses the middle score, but that can be of little comfort to a borrower if he/she has scores of 550, 570 and 700, and the interest rate for a borrower with a 570 score is two points higher than for a borrower who has a 700 score. Still, keep in mind that this situation is rare. A borrower with good credit would, for example, have scores something like 685, 702, and 710.

Other new developments include outreach efforts to educate consumers about credit scoring by conducting seminars and sending out publications on the subject, plus efforts to make scores more readily available to consumers. Federal law says consumers do not have a right to see their score, but does not specifically prohibit lenders and creditors from revealing it (the credit report you can purchase from your local credit bureau does not have your scores posted – for now, only reports ordered by creditors have scores). Many in the mortgage industry, who know just enough about credit scoring to be dangerous, wrongly believe they are not allowed to tell you your score. That may be their company’s policy, but the Federal Trade Commission has made it crystal clear that it is illegal to reveal scores to a consumer, and some industry and consumer groups are now coming out in support of release of the scores. I strongly support the release of scores to consumers, so long as the scores are accompanied by information about how the scores are computed (my columns work nicely, I would think), so a number isn’t just shoved at a consumer with no context or explanation.

In fact, until recently, Fair, Isaacs has opposed the release of the score to the consumer, fearing that, as the company told me in an e-mail, since “the nature of credit risk scoring requires that consumers behave normally (and therefore predictable) when managing their credit and if large numbers of consumers receive and misunderstand their credit risk scores, their short-term behavioral changes could harm the predictive accuracy of the scoring model.” Fair, Isaacs position is that “the expansion of the credit industry in the 80s and 90s (was) made possible by expanded use of tools like credit scoring,” so anything that hurts the “predictive accuracy” of the model could make credit less-available. I would acknowledge that some might say that making credit less available is a good thing!

So, you might be wondering, just how is a score generated? A California-based company called Fair, Isaac http://www.fairisaac.com has created a complex, proprietary mathematical algorithm. By “back-scoring” millions of credit files using thirty-three or more “variables” that are grouped into five categories, from which your credit score is computed, and then analyzing the performance of those files, the company found the resulting score to be an incredibly accurate predictor of future rates of default or late payments. Of those scoring below 600, 1 in 8 would have one or more 90-day late payments. Above 700 that number slipped to just 1 in 123 and above 800 only 1 borrower out of 1,292 would have one or more 90 day late payments.

The five categories found to be more predictive (with their relative weighting in parentheses) are:

• Past Payment Performance (35%): Do you pay your bills on time? The more recent the late payments, the lower you credit score. In fact, a 30 day late payment today hurts more than a bankruptcy five years ago.

• Credit Utilization (30%): Have you maxed out your credit lines? Low balances on a few cards are better than high balances on one or two cards. Keeping balances below 30% of the credit line increases your chance for a higher score.

• Credit History (15%): The longer your accounts have been open, the better, so surfing for a new lower rate on a credit card and transferring balances can hurt your score.

• Types of Credit In Use (10%): Getting a loan at a finance company rather than a bank or credit union lowers your score.

• Inquiries (10%): Applying for new credit lowers your score, but multiple inquiries from the same type of creditor – like mortgage companies or car dealers – within 14 days count as only one inquiry. Promotional or administrative inquiries do not count against the score – only those times that you applied for credit count.

It’s no secret that Fair, Isaacs isn’t happy about the relative weightings leaking out, and it contends that the relative ratings above are not necessarily correct. The company, in an e-mail, to me “…the numbers change over time. That’s why we periodically update our models and scorecards to account for changes in consumer behaviors, lender policies, etc.” Well, then, now that we know how a score is computed, how do you go about improving it? Certainly the best way is to pay your bills on time. You should also keep your balances to below 30% of your credit line, and its better to keep some small balances on several cards rather than high balances on one or two. Maintain your accounts for a long period of time. Limit the number of times you apply for credit.

What if you have done all that and there is incorrect derogatory information on your report? Challenge it quickly with the help of a mortgage professional, and insist the creditor correct the information promptly. It can’t hurt to check out your credit report with a mortgage professional a few months before you intend to apply for a mortgage. But, in any case, with the increasing amount of identity theft occurring, you should check your credit report at least once a year anyway.

For more information on credit reports and credit scoring, see my article last month and go to the following websites: http://www.creditscoring.com, http://www.ftc.gov.com, http://www.homepath.com and [http://www.fairisaac.com/consumer]. At http://www.namb.org the site of the National Association of Mortgage Brokers, you’ll find two of the best brochures I have seen on the subject – one for consumers and one for mortgage professionals. They were just released recently; you can also find message boards on the subject, and a lot of other sites that deal with credit scoring, by entering “credit scoring” on any of the search engines. Once a year you can get a free credit report from: http://www.annualcreditreport.com.

If you are having problems with your credit go to my article “Reestablish your credit”. You’ll find some helpful hints. If you have any questions please feel free to call me: 952-345-7664 or Cell 612-597-6645 or Toll Free at 800-425-5150, ext. 7664.

Dick Piehl

Certified Mortgage Planner

Voyager Bank & Mortgage

952-345-7664 Direct or 612-597-6645 cell

www.OneStopMortgageShopping.com [http://www.OneStopMortgageShopping.com]

How important is it really to repair one’s credit score?

Credit scores are tantamount to one’s purchasing and borrowing power. Buying a new home, qualifying for a low APR credit card to shopping for a small business loan all depend on a consumer’s credit history. A low credit score identifies that a consumer may be overextended in bills, is unable to manage accounts or has a poor repayment behavior.

What is a credit score?

The credit score is prevalently referred to as a FICO score or a numerical portfolio of a consumer’s borrowing and bill repayment behavior. The information contained in a credit report is very similar to a report card. FICO credit scores range between 300 and 850. Credit scores above 850 are extraordinary. While a credit score of 300 is deemed exceptionally unusual, FICO scores generally do not fall under 500.

Annually, billions of credit approvals are determined based upon a consumer’s FICO score. While credit scores represent personal financial records of payment, a FICO scores are used to make other important lending and financing decisions:

* The dollar amount of a credit line or loan

* Interest rate

* Pre-approval of credit cards

* The authorization of a cash advances

* The type of cell phone service (pre-paid or standard)

* The approval to rent an apartment

Because credit scores use the last two-year’s of a consumer’s credit card, borrowing and repayment history, everyone has the power to improve their score. In order to understand how a credit score is assessed, it’s important to understand which components of one’s credit history are used to calculate a FICO score:

* Payment History 35%

* Availability of credit and usage 30%

* Duration of open accounts with creditors 15%

* Credit inquiries (the number of applied credit cards) 10%

* Composition of credit file – bankcard versus installment debt 10%

Use the following steps to raise your credit score

OK, so you have a little (or maybe not so little) problem with your credit report. All is not lost, but you will have to dedicate some effort and time to “fix or repair” your credit score. Keep in mind that it took more than 30 days to screw your credit score up, so make sure that you follow the basic guidelines of restoring it.

There’s a lot of jargon and information you need to know before you start your repair project. Repairing your credit score is not brain surgery but you do need to adhere to some basics in order to accomplish your goal of a higher credit score. There’s a lot of misinformation out there about just exactly what a credit score is and how you improve it.

Don’t Get Ripped Off

Another problem with credit repair is there are 100′s if not 1000′s of scoundrels out there that prey on the unsuspecting person with less than stellar credit. They will make unrealistic claims that promise to fix anything for a price. And the worst part is that not only will they take your money, they can actually cause damage to your credit score.

Our less than perfect credit rating system is regulated by the government. Which can be both a good thing and a bad thing. But you should know a few facts and don’t get fooled.

You can also get a FREE credit report from all three major credit bureaus. Don’t pay for something that you can get for FREE. Go o the Federal Trade Commission’s site here to get the full details:

[http://www.ftc.gov/bcp/conline/pubs/credit/freereports.htm]

The only catch 22 is that you don’t get a credit score with your credit reports. But if you have been turned down by a creditor (or given what you think is an unfair rate) you can request the information from them and they will provide the score they used to determine your rate.

But it’s still pretty clear on the credit reports what might be having a negative impact on your credit score. So these reports are the first step in working on raising your credit score.

And keep in mind there are no secrets, no special methods, and certainly no one has any better chance than you, the owner of the credit score, to repair or fix your credit score.

What Is A Credit Score?

A credit bureau, or credit repository, is an entity that gathers information about consumers’ credit histories. Your credit history/report includes information regarding the following items:

– Identity information such as your name, address, social security number, spouse and date of birth.

– Payment habits such as how promptly you have made payments to previous creditors.

– Public records such as records of arrests, indictments, convictions, lawsuits, tax liens, marriage, bankruptcies, and court judgments.

– Debts.

– Other relevant credit data Information concerning your current employment such as the position you hold, length, and possibly your income.

– Information about your personal history such as the number of dependents you have, your previous addresses and information about your previous employment.

Credit bureaus sell credit reports to credit grantors, such as banks, finance companies, and retailers. Credit grantors use credit reports to determine whether or not a potential borrower is creditworthy.

There are three major credit bureaus in the United States:

* Equifax: 800-685-1111

* Experian: 888-397-3742

* Trans Union: 800-916-8800

These three bureaus provide nationwide coverage of consumer credit information. The credit bureaus are a for-profit system that generates billions of dollars in revenue each year from selling copies of credit reports to creditors and mailing lists. Trans Union made 1.5 BILLION dollars last year.

It is essential to understand that Credit Bureaus are nothing more than record keepers, and sometimes not very good ones. Consider the fact that these organizations are tracking millions of people with up to 40-50 entries per individual. In all fairness, I can’t even type a letter without making a couple of typos.

So mistakes happen, wrong information gets into the wrong file, and all three credit bureaus don’t talk. They are competitors so they don’t share information and all three can generate a different score. They all loosely base these scores on the FICO method.

FICO scores are based on 22 pieces of data collected by the three major credit bureaus. The lowest possible score is 300, while the highest is 850. None of the credit bureaus will apply these methods exactly the same and also may not have the same data so it’s common to get a different score from each one.

The lending companies (or creditors) will usually use this FICO based score provided to determine the risk of lending money or granting credit. The higher your score, the less risk, so the lower the rate. The difference in credit cost can be dramatic. If you are applying for a $216,00 mortgage and have a score of 630, your rate could be $1568 per month at 7.89%. If your rate was 680, you could get a rate of $1394 at 6.7%. That’s a $2100 per year difference so you can see how 50 points can have a big impact on your credit cost.

Basic Repair/Fixing Methods

You often hear that you should dispute (challenge) any and all negative information. But most people don’t know or advisors fail to mention that the creditor and the credit bureau may declare the disputes “frivolous” and not have to respond. So before you go crazy on disputes, keep that in mind. Many of the negative items do have a time limit imposed, depending on the item. Here’s a good set of guidelines on what to challenge:

– Information is not based on you (mistaken identity)

– Information is inaccurate based on what actually occurred.

– Information is outdated – there was an issue but it has been resolved.

– The time limit on the information has occurred.

– The information is totally incorrect with no valid basis

So once you have requested your FREE copies of your credit reports, you need to review them to find any inaccurate or false information. When you find a negative entry that you want to dispute, you need to send a letter of dispute, or file the dispute on line directly from the credit bureau website. Some say the online method is much quicker and since USPS does take days it probably is faster. The credit bureau has up to 30 days to verify the dispute with the filer of the negative information. If you forget to give all the necessary information and they request more information they can get an additional 15 days (total 45).

You can get a sample credit dispute letter here: www.newcleancredit.com/creditdisputeltr.pdf. So it’s important to make sure you provide all required information to shorten the process. Once filed the credit bureau will respond to you with the results.

The good news about our credit reporting system is that time marches on and you can start improving your credit score immediately. Most experts in the financial industry agree that the last 18 months is the most important. Try and negotiate any negative items that are true (bring payments up to date, settle old claims, work out new payment plans, whatever). Most creditors will be more than willing to work with you if you make an honest effort in resolving the negative issue. But make sure the creditor agrees to update your credit record.

You can also make sure any good credit information is listed. If you have credit experience that is favorable, write or contact the creditor and as to have it added to your credit report. Many times good information is never reported. You can also open new credit accounts from creditors and pay them off early (even if you have the money to pay cash) to get addition good credit entries.

Get our Free Repair Your Credit In 30 Days Guide for more details on how to raise your credit score here: www.newcleancredit.com/resources.shtml

Everyone should check his or her credit report each year. It’s now Free and won’t take much time as long as you stay on top of it. You can request one credit bureau at a time every 4 months and have a good idea of what’s been entered in the past 12 months.

New Clean Credit is a website that provides free information on Credit Repair. Along with their Free Repair Your Credit In 30 Days Guide they have a large amount of articles on just about every credit related subject. Increase your credit score today. Click here to learn more: www.newcleancredit.com/

Jim Baines is a staff writer for the New Clean Credit web site. Jim has worked in the credit industry for over 20 years and helps address credit repair issues for our users.

Have you ever wondered how some people can easily and effortlessly waltz into a bank and walk out with a home loan, car loan, or line of credit, while others get rejected time after time?

Have you ever been puzzled at the complex science behind credit scoring? It is a somewhat confusing and mind-numbing mix of numbers, ratios, and complex algorithms used by our lenders these days to supposedly calculate your risk as a borrower.

Are you tired of feeling confused at the lingo that so many lenders throw around as if you knew what they were saying as they turn you down for having insufficient credit scores?

You are about to discover the simple credit scoring secrets that lenders use to help evaluate your risk as a borrower.

I will pull apart the few components of a credit score for you so that by the end of this, you will be able to better understand exactly what you must pay attention to with regards to your own credit, so that you can become and maintain status as an “A” borrower forever more.

What is a Credit Score?

A credit score is a number that lenders use to estimate their risk if they should choose to lend you money.

Experience has shown them that people with a high credit score are usually going to pay them back with little or no problems. Conversely, borrowers with lower scores tend to be a higher risk to them and tend to be more likely to pay late or perhaps stop making payments altogether.

Credit scores (usually) range from 340 to 850 points. As your score climbs, lenders tend to offer lower interest rates and better terms. Conversely, the lower your score dips, the more likely you are to have higher interest rates, higher fees, tougher terms, and potentially even get declined by the lender altogether.

How are Credit Scores Calculated?

The three major credit reporting agencies don’t necessarily use the same scoring. So don’t be surprised when you see 3 different credit agencies come up with 3 slightly different scores.

Your credit score is a number generated by a mathematical formula based on the information and data in your credit report. Your information is further compared to millions of other people’s information and data.

This number is a pretty accurate prediction of how likely you are to pay your bills and honor your commitments to your lenders.

What’s a Good Credit Score vs. a Bad Score?

The scale runs from 300 to 850. The vast majority of people will have scores between 600 and 800. A score of over 700 is usually considered “excellent credit” and will usually get you the most favorable interest rates on loans, mortgages, and credit cards. If the score is in the low 600′s or below, then you are viewed as a higher risk, and considered to have “mediocre” to “poor credit”.

Here’s a look at national averages for credit scores among the US population in 2003:

Up to 499: 1%

500 – 549: 5%

550 – 599: 7%

600 – 649: 11%

650 – 699: 16%

700 – 749: 20%

750 – 799: 29%

Over 800: 11%

What Goes Into The Score, and Which Parts Are Most Important?

35% – Payment History

30% – Amounts You Owe

15% – Length of Credit History

10% – Types of Credit

10% – Newly Established Credit

Let’s break this down and make it simple. Bottom line is, at the end of this conversation you need to know just what this means to you. So let’s keep going here.

Payment History:

This category of the score reflects things like…

…Number of accounts paid as agreed

…Delinquent accounts

…Number times past due on payments

…How long you’ve been past due

…Time elapsed since you had a past due payment

…Collections, foreclosures, liens, judgments, etc

…Negative public records

How you pay your bills is a huge deal. Paying all your bills on time is good. Paying them late on a consistent basis is not good. Having accounts that were sent to collections is worse yet. Going into bankruptcy is even worse still.

What You Owe:

Basically this category is looking for signs of being over-extended, and making sure you are paying down your existing debts consistently

-How much you owe

-How much of your credit limit you’ve actually used

-Amounts you owe on installment loans vs. their original balances

-Number of accounts that are paid down to zero

-Remaining available credit

People with the high scores tend to use credit sparingly and keep their balances low. People who consistently max out their balances are usually considered to be a higher risk. People who never use credit will never have a history (good or bad) to monitor or track.

Also keep in mind that if you have $50,000 of available credit spread over 5 cards or accounts, then you are best advised to keep your balances at $25,000 or less. Furthermore, you should spread that debt over all 5 cards. This is better than maxing out 3 of your cards for the $25,000 and having 2 cards with a zero balance.

Length of Credit History:

Length of time since accounts were opened, time that’s passed since the last activity, and the total length of time tracked by your credit report are all components here.

Basically, the longer you have good history, the better your scores tend to be.

Mix or Type of credit:

The best scores will have a mix of both revolving credit (credit cards) and installment credit

(mortgages or car loans). When you are lopsided one way or the other your scores will slip downward. Even if your payments are good and account balances in check.

Your New Credit:

The final category to explore is new credit. Basically this is a question of how much new credit have you been applying for. How many credit applications have you been filling out with different lenders of any type?

This section wants to know the number of accounts you’ve recently opened. It further analyzes the time that’s passed since recent inquiries or newly-opened accounts. It analyzes the number of recent credit “inquiries” or “credit pulls” you have asked for recently even if it didn’t result in a loan.

In general, it just monitors that you aren’t trying to open to many accounts at any one time, thereby stretching yourself too thin.

Conclusion:

Well there you have it. A short, sweet, bullet point synopsis that helps us better understand the nature of the credit report, and how is used and calculated.

Keep in mind that credit scores are not perfect.

It is quite common that a person’s report may have some or a lot of misinformation. This would not be the end of the world. So don’t sweat it. But do take it seriously. There are ways to improve your credit.

It is in your BEST INTEREST to make your score as high as possible, as quickly as possible. And now that you know how your score is based, your can target your game plan to effectively become the perfect borrower.

BIO Dan Ostler is the owner of LeaseOptionHomeBuying.com . Dan is an author, speaker, business owner, investor, and one of the nations leading Lease Option Consultants. He has been offering housing solutions and consulting advice to families with credit issues in all parts of the country for the past 8 years, and welcomes all visitors to his website for tons of **FREE** Information.

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The moment you decide to enter into wedlock is a time of mixed emotions. The elated feeling that you have found the right partner with whom you wish to spend the rest of your life, the excitement about how you should go about planning for your future and the anxiety regarding finance to make arrangements for your wedding all rush into your mind at once. The current economy poses tough challenges and hence it is natural that you are concerned about your wedding expenses. However, you could avail wedding loan to manage your wedding expenses and hence just let the joy of marriage commitment sink in.

List Your Expenses

Planning your expenses goes a long way in making your arrangements successful. You need to consider the expenses involved in your wedding before you apply for a wedding bad credit loan. Some of the important factors you need to take into account are the type of wedding you prefer to have, wedding location, number of invitees and food arrangements. You cannot forget photography and videography on the day of your wedding, as you would want to relive every moment of your wedding through out your life.

Plan Your Budget

Planning your budget is equally important if not more. You might want to have the best arrangements in town for your wedding, but you need to consider the amount you could repay comfortably every month after you are wed. You would not want financial burdens to be saddled with you while you commence your married life. Have a budget that would be comfortable for you both to handle. It would be asking for too much to predict all expenses you would incur in the first few months of marriage. Hence, you need to allow provisions for unexpected expenses before you decide on how much you could manage in repayment of wedding loan.

Secured and Unsecured Loans

You can opt for secured loan using your home or any other form of security. You might also avail unsecured no credit check loans and here you are not required to provide collateral security. The terms of loan, rate of interest and monthly repayment are to be studied by you before you make your decision on the loan. It would do well to seek referrals from your friends so that you enter into an agreement with the right lender.

What Is Required Of You

You need to be United States resident. You should be 18 years or over to be eligible for wedding loan. You need to provide income proof. If you are self-employed, you need to produce last two years’ income tax returns. You will be required to attach copies of last 6 months bank statements. Generally, wedding loans are also offered to persons who have bad credits. You can use the loan amount the way you like once the loan is sanctioned but it is best to exercise caution while spending.

Great Moment, But Life Is Greater

Agreed that the day of wedding is a great moment in every one’s life but life after wedding is greater still. You have your life partner who has committed to remain with you through thick and thin. However, you would not want to start your marriage with trouble. You have one full life to live and ensure that you do not spend your hard-earned money on a single day. Have a great marriage and ensure you have a great married life.

If you are looking to go in for plastic surgery and your mind is engaged in arranging for finance, here are some suggestions to help you through. Plastic surgery could cost you more and hence a loan is sure to offer a breather. There are various loans available for plastic surgery. You need to choose the one that best addresses your concern. At worthyloans blog you can get all the updates about loan for various factors.

Personal Loan for Plastic Surgery

The best option would be to apply for personal loan with your bank. Bank charges low interest and you may need to provide collateral. Depending on the medical expenses for your plastic surgery, you may have to offer your car or other assets as collateral security.

Unsecured Loan Helps In Case Of Bad Credit

If you have a bad credit score, you may go in for unsecured loan from financial institutions. Here, you will be charged higher rate of interest.

Medical Credit Cards Come To Aid

Medical credit cards top the options list while one plans to have plastic surgery. While some medical cards offer 0% interest initially and later charge lesser interest rate, default in payment could cost you heavily.

Comfortable Conventional Credit Cards

Normal credit cards do offer loans for plastic surgery. If the interest rate is low, this could make a comfortable option. However, you need to consider the size of the loan amount. A bigger loan amount might reduce your credit score until you pay off your debt.

Where Doctors Help Outside the Operation Theatre

You may talk to your doctor about your financial status and let him know how some help in this regard would be highly appreciated. Some hospitals have an arrangement where they allow the patients to settle their bills in monthly installments. Under such plans, you are not charged interest.

401 (k) Loans – Tapping Your Resources

By going in for 401(k) loans, you are using your resources as it is from your retirement fund. There will not be a credit check, you need not provide collateral and the interest you pay goes directly to your retirement fund account only. The major risk in obtaining 401(k) loan is when you quit your job with the present employer. Under such circumstances, you will be expected to settle the entire loan within 60 days.

Factors to Consider While Applying For a Loan

Before applying for a loan, it would be better to have a detailed discussion with your doctor about the procedure involved and the expenses involved in the process. Once you have a clear picture on the amount you might require to undergo a plastic surgery, you need to take into account the amount you can flush in from your savings. The more, the better as you will be having lesser debt amount. You need to apply loan for the balance amount and here you need to exercise caution. While you may be eligible for higher amount, it would do well to restrict your loan amount to your surgery needs only.

While approaching the lender, ensure that you have all the documents readily available so that you save on time. Learn about the types of loans available for you, the interest you will be charged and repayment terms. Some lenders charge you application fee. Hence, have it confirmed and you need to ensure if there is a penalty in case of foreclosure. It is great to have a plastic surgery to suit your needs. At the same time, ensure that you plan your finances to suit your budget. www.worthyloans.com is a source for all type of loan. You just need to apply with their online application form.

Being pregnant is a wonderful phase in the life of a woman that deserves a very pleasant atmosphere and relaxed frame of mind. It is quite natural for you to be looking to buy a new home before your little one arrives. If you are worried about not being able to get mortgage loan because you are pregnant, it is high time you set aside your qualms. As mentioned above, you are in a phase of life where you have to be relaxed. Hence, you can have the good news and that is yes, you can get a mortgage loan during pregnancy. It is true that some lenders are apprehensive about offering loan when one is pregnant but there are many no credit check loans lenders who do not consider pregnancy to be in the way of sanctioning mortgage loan. Take comfort from the fact that it is against Federal law to discriminate based on pregnancy while approving mortgage loan.

Lenders’ Point of View

Some lenders opine that there are possibilities that a pregnant woman might not want to return to work after delivery. Hence such lenders deny the application stating that mortgage loan cannot be offered until the woman returns to work after delivery. However, most of the lenders do not give a second thought about the lady being pregnant while applying for a bad credit loan. Some lenders will just ensure from the employer the salary of the loan applicant and the intention to return to work after delivery. Lenders who offer loans during pregnancy take into account the income at the time of loan application and everything is fine as long as you do not go on maternity leave before applying for the loan.

On the contrary, if you are already on maternity leave, you need to confirm that you intend to return to employment. Under such circumstances, the lenders will consider your regular income while deciding on the loan amount. However, some lenders will take into account your reduced income while you are on maternity leave. If you have sound deposit with your husband’s steady income to repay the loan even while you do not contribute to the family’s wallet, your application will be viewed in a favorable light by the lender.

Type of Maternity Leave

You may be going on a paid maternity leave or unpaid maternity leave. While paid maternity leave is a favorable position for you, you might still end up with assessment based on the salary you receive during maternity leave and not the normal salary you earn. If you are on unpaid maternity leave, things get a little difficult. However, you might talk to your lender and come to an understanding as to what could be done best to enable sanctioning of mortgage loan. Some lenders do expect you to produce a note from your doctor stating the time that would be fine for you to return to work and another note from your employer mentioning your salary once you return to work. On producing necessary documents, you will be offered a mortgage loan.

You are awaiting the most joyous moment of your life and let not all the worries about mortgage loan keep you from your happiness. All you need to do is to take some time to research and identify the lenders who could hand you the loan so that you could move to the house of your dreams to await the child’s arrival.

What is credit? What is a credit report? What is a credit score? Where can I safely get a copy of my credit report for free? These are some of the most important questions in personal finance and they will be addressed in this article. The subject of credit scoring has become an increasingly hot topic, and for good reason. For many years, the general public only associated the concept of credit scoring with the need to purchase high−ticket items such as a new car or a home. Today, credit scoring goes much further. Your credit score can affect your ability to get a good rate on commodities such as car insurance, cell phones, or even determine whether or not you get the job that you want. Indeed, the financial snapshot provided by the credit score has also become a gauge for many employers, especially those who seek to place employees in a position of financial responsibility.

What is Credit?

Credit is like a report card telling you how well you have paid your bills. Credit is a record of how you pay your credit cards bills, auto loans, mortgage loans, etc. Whenever you buy something with a monthly payment, the people who you collect your bill report this information to create a credit report. Examples include buying furniture on credit or using a Best Buy store card to purchase a computer. Exceptions include utility bills, cell phone bills, and rent payments. Collection accounts, court judgments where you owe money, and bankruptcies are also part of your credit.

Who Collects My Information?

There are only three companies in the U.S. that collect all your credit information. They receive this data from all of your creditors, like the credit card company or your auto loan company. The companies are Equifax, Transunion, and Experian, also known as credit reporting agencies or credit bureaus. They compile all the information they receive and create a credit report on you.

What is a Credit Report?

A credit report is a document that shows all the information collected by the credit bureaus. A “tri-merge” or “merged” credit report contains the information from all three credit bureaus in one report. This report lists all your past credit accounts that have been reported to the credit bureaus. The report lets you know how much money you owe to creditors, what your available balance is, and your complete payment history, including any late payments. The credit report can also list your current and former addresses and even employers. Additionally, the credit report will also give you a number that each credit bureau assigns to you, called a credit score.

What is a Credit Score?

A credit score is a number from 300 on the low end to 850 on the high end. Each of the three credit bureaus will evaluate your credit to determine your score, and each bureau will give you a score. The higher the number, the better the credit history. But, exactly how do they assess what’s on your credit report to give you a number?

What Makes Up My Credit Score?

There are five parts to your credit score (also known as FICO score). Points are awarded for each of these five parts, and a high score is most favorable. The factors are listed below in order of importance.

1. YOUR PAYMENT HISTORY − 35% IMPACT on your credit score

Have you paid your credit accounts on time? Paying debt on time and in full has the greatest positive impact on your credit score. Late payments, judgments and charge−offs all have a negative impact. Missing a high payment will have a more severe impact than missing a low payment, and delinquencies that have occurred in the last two years carry more weight than older items.

2. HOW MUCH YOU OWE vs. AVAILABLE CREDIT − 30% IMPACT on your credit score

This factor marks the ratio between the outstanding balance and available credit. Ideally, the consumer should make an effort to keep balances as close to zero as possible, and definitely below 30% of the available credit limit when trying to purchase a home. The more you owe compared to your credit limit, the lower your score will be.

3. LENGTH OF CREDIT HISTORY − 15% IMPACT on your credit score

This portion of the credit score indicates the length of time since a particular credit line was established. A seasoned borrower or longer credit history will always be stronger in this area. However, you can get a high score with a short credit history if the rest of your credit report shows responsible credit management.

4. TYPE OF CREDIT − 10% IMPACT on your credit score

A mix of auto loans, credit cards, personal lines of credit, and mortgages is more positive than a concentration of debt from credit cards only.

5. INQUIRIES − 10% IMPACT on your credit score

This percentage of the credit score quantifies the number of inquiries made on a consumer’s credit within a six−month period. Each hard inquiry can cost from two to 25 points on a credit score, but the maximum number of inquiries that will reduce the score is ten. In other words, 11 or more inquiries within a six−month period will have no further impact on the borrower’s credit score. Note that if you run a credit report on yourself, it will have no affect on your score. Credit scores distinguish between a search for a single loan and a search for many new credit lines, in part by the length of time over which inquiries occur. If you need a loan, do your rate shopping within a focused period of time, such as 30 days, to avoid lowering your credit score.

Additional Resources:

To order your free credit report, go to this outlet established by the U.S. Congress:

www.annualcreditreport.com

To read the Fair Credit Reporting Act, go to:

www.ftc.gov/os/statutes/frca.htm

For the Federal Trade Commission’s information on consumer credit, go to:

www.ftc.gov/bcp/conline/edcams/credit/index.html [http://www.ftc.gov/bcp/conline/edcams/credit/index.html]

To get additional education about your credit and how to improve credit scores, go to:

www.ivanbarriga.com [http://www.ivanbarriga.com]

Mortgage Consultant Ivan Barriga at [http://www.ivanbarriga.com] has helped over 300 families buy homes and plan their mortgage strategy. Barriga is a Illinois native and MBA graduate of the Kellogg School of Management, #1 ranked business school in U.S. (Business Week 2005). He is also a Certified Mortgage Planning Specialist (CMPS), a designation achieved by the top professionals in the mortgage industry. He is a recognized expert in the area of mortgage planning, cash flow management, and real estate equity management.

“I am a Certified Mortgage Planner. I help clients successfully manage their home equity to increase liquidity, safety, rate of return, and tax deductions. Unlike a traditional loan officer, my role is to help clients integrate the loan that they select into their overall long and short-term financial and investment plan to help minimize taxes, improve cash flow, and minimize interest expense.”

There are a large number of people out there struggling with their finances in the current global financial climate, mainly because they built up a lot of debts when times were good and the credit was free flowing. A lot of people borrowed a lot of money before the credit crunch, either on their store cards, personal loans, credit cards or over-sized mortgages. Unfortunately, those same people are now realising how reckless all that borrowing wad and are finding it harder to get out of debt than it was to get in it. For those people in debt however there are certain strategies it is possible to follow in order to quickly manage and reduce those debts:

(1) Take Some Time Just to Get a Clear Picture of your Outstanding Debts: It is often the case that people have an ‘out of sight, out of mind’ attitude to their outstanding debts and try to avoid working them all out – but this is a mistake. The best thing you can do is gather all your debts, all of your cards and bills and statements and add up the total outstanding amount as well as the total required monthly repayment that you will need to find. Once you’ve done this, you should put together a repayment schedule.

(2) If You Owe a Lot, Speak to Someone: Whether its your friends, family or a debt counselling group, you should probably talk to someone if you are feeling stressed about your debts.

(3) Allocate yourself a Fixed Monthly Budget: When you have worked out how much it is necessary to clear each and every month, it will then be necessary to fix yourself a monthly budget that will include both these payments as well as a budget for your standard monthly expenses. Attempt to actually clear more of your debts every month than you are required to do and always stick to that budget.

(4) Never Miss the Minimum Payment: Missing the minimum required payments will just make your situation worse. By paying the least required amount you will at a minimum keep your debts managed and ticking along. If however you pay over the minimum amount then your debts will clearly come down a great deal quicker.

(5) Create an Emergency Fund: Put some money aside for that proverbial rainy day.

Esther is a financial journalist and business blogger. She writes about all areas of personal finance affecting the consumer from tax relief to credit and store cards to accounts receivable finance.