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d i l o AS I

t is imperative to have a solid credit report that is accurate and up to date. As credit restrictions increase during uncertain economic times, each of us needs to make sure our credit reports is accurate and doesn’t contain errors. Your credit history contained in your report is important as it makes up the credit score derived from it. While the report will give lenders, employers, landlords, etc. a credit overview of the person with whom they are doing business, the credit score gives them a single, solid, data point with which to make decisions that have a deep impact on your financial future.

By Ela Kitchen Founder/CEO AxSys Financial Group

4.

The following are important points to be aware of as they relate to your credit report and score.

Spread debt around. If you’re close to your credit limit on any one credit card or line of credit, your score will be hurt. Suppose you have three credit cards with $1000 limits, and one is maxed out while the other two have no balances. Credit-wise, you are better off carrying a $400 balance on all three credit cards than keeping one of them close to the max. Even though you will owe $200 more in the latter scenario your score will be better. Having different sources of credit is better for your credit score than having a credit report dominated by credit card debt. So keep the card and or account type in mind when you are applying for new credit.

1. Closing accounts hurts your score. Instead of

5. Focus on the big picture. Having one 30-day late

closing old accounts, just pay them off and leave the accounts open. The longer you’ve had an account, the better for your credit score, so you should keep the oldest credit account you have active even if you do not use it. Creditors close accounts that aren’t used frequently themselves, so there is no need for you to do it. The negative blow to your credit score is the same as if you’d closed it yourself. In some cases, the creditor will stop reporting an unused account to your credit report, and you’ll lose the positive impact it has on your score. The best case scenario is to keep open old accounts and use the card or account every six months or so in order to keep the accounts open and actively reported.

payment on a credit report full of on time payments is not that damaging in the big picture of the credit score. Likewise, credit reporting agencies have also

2. Check your report frequently. You’ll also want to check your report to make sure it’s correct and in doing so, this is the best way to uncover identity theft. Early detection of credit report issues and frequent review can limit the amount of damage a thief can do to your credit rating.

discounted the impact of collection items under $100. To get the best possible score, focus on a healthy debt mix that includes different kinds of credit and loans. Don’t make any late payments, keep your balances moderate, and above all, be patient. You can’t improve your score over night, but with time, good borrowing behavior and credit reporting diligence all have a dramatic impact on your creditworthiness.

Don’t make any late payments, keep your balances moderate, and above all, be patient. You can’t improve your score over night, but with time, good borrowing behavior and credit reporting diligence all have a dramatic impact on your creditworthiness. Ela is the founder/CEO of AxSys Financial Group, where she helps consumers repair their credit and mortgage situations as a certified HELP Specialist and Credit Coach. She has worked in the Financial Service Industry for over 17 years and has a thorough knowledge of how credit really works for and against people. She and her husband Lewis owned a mortgage company that specializing in credit-challenged borrowers. Now, a passionate consumer advocate, she works oneon-one with people to help improve their credit profile as well as companies to improve their employee productivity thru financial awareness and incentives. There is a pressing need to provide financial education to the community at large. Ela’s mission is to strengthen her community and improve the lives of consumers by offering services promoting financial literacy, home-ownership retention, and a healthy economy. l

3. Don’t worry so much about inquiries. A lot is said about checking your report and how it hurts your score. In reality, a hard inquiry costs about 2.89 points on for the first 10 inquiries.

AxSys Financial Group 888-453-0096 888-453-5177 FAX ela@axsysfinancial.com www.axsysfinancial.com // bhtmag.com // 19

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