Help your credit score! Advice from A1 Financial USA

We hear from many folks that they're afraid of getting credit, because they've seen their
friends file bankruptcy. Of course, discipline in all things is important, but completely avoiding
credit is like completely avoiding foods that are good for you. You'll never run a marathon eating
just pizza & potato chips, and you'll never be able to purchase a home without a good credit
rating.
If you have no credit rating, open a checking account and use it perfectly for a year.
That means no overdrafts, and use it regularly.
After a year, you'll start seeing credit card offers. Sign up until you have 5 of them, and charge
10% of the credit line. No more than 30%, no less than 10%.
(If you prefer cash out (cash advance) but they won't allow it, call us at 909-930-9159).
Pay the payments regularly. You'll see your FICO rise over 700 in no time.
Not that many people know because it is so rare but your FICO score is able to reach 850.
Having a high credit score can drastically save you hundreds of thousands over the years in money from interest from mortgages,
credit cards or purchasing a vehicle etc.  

Here are 7 steps how to get above an 800+ credit score:

ON TIME PAYMENTS -Just paying on time is 35% of your score. NEVER make a late payment. The higher your credit score, the more it can
drop with a late payment. It takes a long time to build a high credit score but one late payment can bring you crashing
down.                                                                                   
UTILIZATION - This is mostly taken into consideration from your revolving debt (credit cards & line of credit).
The standard everyone knows is to have your utilization at 30% or less but if you really want to increase your score, have it less than 10%.  
Example: For a $10,000 credit card to have a utilization of 30% or less you need it under a $3,000 balance. Under a 10% or less
utilization as  a $1,000 balance or less.                                                                                 
INQUIRIES- Inquiries are only 5% of your score. Although this is a smaller factor it's still important. 72% of people with 800 credit haven't
applied for "credit" in a year.                                                                                                                               
MIX OF CREDIT- This is most likely the most important and less understood to obtain an 800+ credit score.
FICO wants to see that you have a credit mix of BOTH revolving and installment
loans.                                                                                                                                                                                                       Revolving
are credit cards or line of credit. Installments vary from personal loans, auto loans, mortgages, student loans etc. If you just have one form of
credit on your credit report such as just credit cards only, you're most likely not going to be in the 800 club. A mix shows FICO you're
responsible with EVERY form of credit therefore a higher score like an 800+.                                                            
NUMBER OF ACCOUNTS - The average 800 credit score has 5 credit cards ALONG WITH a credit mix  of a couple of installment loans
(mortgage, auto, student loan, personal loan etc)                                                                                
NEGATIVES - I think it is pretty understood to not have any derogatories/late payments/public records to be in the 800s.  
Not even one. If you have a derogatory or late you're probably going to get knocked down to the 700 club,
and that's if you're lucky.                                                               
AGE OF ACCOUNTS - NEVER cancel a credit card!
The longer the better is how FICO sees it. The oldest "average" credit card an 800+ person has is a $19,000 limit credit card and is 10 years
old. Some people cut up and cancel their credit cards to get out of debt which is fine but remember FICO wants to see that you're responsible
with this so they give more points to people who have long credit history with credit cards.

Help for poor credit borrowers:

APRs (Annual Percentage Rate) forever or as long as they own that credit card. The average
APR in the United States is about 14%.
That can get costly if you're carrying a large balance on your credit card.

How can you lower your % rate or APR?
Simple, simply ask. Yes, call your credit card company and ask for it to be lowered.
You'll be surprised how many times this works. If your credit card company asks why?
State that you've been paying the full amount of your bill on time for the last few months with
your current APR, and there are many credit card companies offering better rates than you're
currently getting. Instead of switching over to them,
I'd like to see if you can just lower my APR.

This works over 50% of the time. If the rep doesn't want to lower your APR, you can hang
up,call back, and try another person that answers.

Remember, they are people too and don't want a hard time and want happy customers.
I'm not saying be rude, but people hardly ask to have it lowered.
Again, you'll be surprised how many times simply asking for it to be lowered, because you're a
good customer, works.
We have had many customers do this in the past.
Try it. :) You got nothing to lose!

-Collaborated editorial by CEO Mark Ayers, Financial Analyst Victor Fernandez, and Consumer
Review Bureau Credit Consultant Julia Harness
A credit score determines how likely you are to default on your next loan....
in a lending computer brain, anyways. We've seen an 814 default, and a 430
pay off early...so what does a silly computer know>?  

A credit rating is assigned by a person who looks at issues beyond your credit report before
deciding how creditworthy you are. These issues include income, job stability, your ability to use
dormant credit lines and more.

We want you to concentrate on your overall financial health rather than scores or ratings. If your
financial health is strong, the lenders will see it.
The real question to be answered is: "Why do I have a large amount of debt?"

Analyze it,see if you made poor choices or good ones.

Good choices are:
Starting an emergency savings account of 6 to 12 months' worth of living expenses,
so you won't have to use credit for unexpected expenses.

Having a workable spending plan that includes putting money away for future goals.

If you don't know why or how you amassed
$10,00, $25,000,$75,000 even $100,000 in debt, analyze how it
happened, or came to be.
You need to understand exactly how you got in the situation you
are in if you are going to avoid getting there again.
At that time will you avoid the financial disaster of accumulating a
new debt load after you consolidate, or use equity to arse your debt.

Funding an emergency savings account should help you better manage unexpected expenses as
they occur,but if your main problem appears to be that you're extending your income with credit,
you need a spending plan. You need a plan that brings your expenses in line with your income
and one you will
commit to follow. Without taking these positive money-management steps, consolidating your
debt will not help your credit rating in the long run but could create the potential for disaster
instead.

In addition, your spending plan will help you determine
if you can afford to consolidate your credit card debt.
With a good credit rating, being 680+,
you may qualify for a personal loan at 10% interest.
You would need to pay $1,500+ per month for 5 years to pay off $75,000
in credit card debt.
You may need to cut back on expenses to afford the consolidation loan payment.\
So it's very important you're sure you're willing to make the needed sacrifices for the entire 5-year
repayment period, and be doubly sure you don't use those cards unless you can pay them off in
full, or even better for your FICO
pay down to 10% of the credit line each month.

Bad choices are:

Buying lavish cars, boats, adult toys, cruises, and yes, even gifts.
We've seen generosity lead to bankruptcy many times. Just check out the news
for bankrupt sports athletes. One must change their mental behaviours if they're going to have
money available to them.
Bad Investments...Double your research on buying stocks, perhaps read
about stock buying in depth in these 10 books:
http://www.investopedia.com/articles/basics/03/050803.asp
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Page updated 9-12-2019
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Vice President: Lauren Hatt
Office Manager: Stephanie Capp
Payroll and Accounting Terry Corlin
(909)-930-9159
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