august membership meeting

How to Improve your Credit Worthiness! 

Excellent and timely information was presented by Gina McNeal at the DRHCC August Membership Meeting hosted by Border Federal Credit Union.
Gina’s powerpoint presentation showed how your credit score can affect the amount you pay for an auto or home loan.  She also explained how key factors that affect your credit score:  payment history and inquiries. For example, it was interesting and surprising to find out that when shopping around for an auto loan, the various dealerships are “required” to run their own credit report, so each one counts as an inquiry and can reduce your credit score.  Gina also explained the need for everyone to periodically check their credit score from the three major companies.  Everyone is entitled to one free credit report each year.  Gina suggested using the available form to request a credit report form every quarter, alternating between Experian, Equifax, or TransUnion.  Many attendees present were not aware that event of public record such as bankruptcies, foreclosures, or tan liens and late payments, may appear on their report.  FICO credit scores range from 300-850.  A good credit score ranges from 620 to 850 and are bound to attract favorable rates from financial agencies. Scores higher than 700 are classified as excellent and means you are more likely to be approved and pay a lower interest rate on new credit.  Good changes are coming  to FICO credit score calculations this fall.  
Fair Isaac Corp., the company behind FICO, says there are three significant changes to its metric, which it says is used in 90 percent of U.S. consumer lending decisions.

1. Debts that go to collections agencies and get repaid won’t count against a consumer’s FICO score.

2. Medical debts will have a smaller effect on the score. If your only major bad mark comes from unpaid medical debts, FICO says it    expects your credit score to go up by 25 points. (Scores range from 300 to 850.)

3. A technique to analyze people’s creditworthiness if they don’t have much of a credit history.

For a personal consultation, at no charge, please contact Gina McNeal located at the BFCU Gibbs Branch.  Note:  This is a free community service.  You do not have to be a member of BFCU to take advantage of financial counseling to consolidate/reduce debt or for questions on your personal credit score.

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