How to improve your Credit Score. 800+?

Why does Credit Score and History matter? How to improve your Credit Score? What can go wrong?
Subscribe - https://www.youtube.com/channel/UCqvXd95xFjrtkGcT01JuUIQ?sub_confirmation=1

Is now a good time to Refinance - https://youtu.be/cPRak1gi-GY

Credit Karma (Monitor your score) - https://www.creditkarma.com/
Annual Credit Report (Pull your report) - https://www.annualcreditreport.com/

Script
What is Credit Score?
• Credit score is your SAT score in the financial world. It is a summary of your credit history that lenders and banks use to predict likelihood of you repaying a loan or any form of debt
• As you go through your life, your credit score will fluctuate. It depends on how reliable you are at repaying debt on time
• There are two companies that develop credit score. FICO developed by Fair Isaac Corporation and VantageScore jointly developed by the three credit bureaus. Both develop credit score that lenders and creditors can use but their scoring model use slightly different criteria
• Here are the factors that influence your score. There are subtle differences between FICO and VantageScore but more or less the same
• Both have a score range between 300 to 850. Each lender sets its own standards for what makes a good score, but a score over 690 is typically considered a good credit score. Scores above 720 are typically considered excellent
• So why should you care?
• Credit score matters because the lower it goes, the more likely you are to default on debt in the eyes of creditors and lenders, which means you will receive higher interest rates on credit and loans
• A positive credit history helps when you are out shopping for a car, renting or buying a home or even applying for a job

What can you do to improve your credit? Here are a few ways
o Pay your bills on time – Set reminders if you need to. I can’t stress enough guys. Paying bills on time is key to improving your credit. Payment history account for 35% of your score
o Keep your credit utilization to 30% or less - Credit utilization refers to the portion of your credit limit that you’re using at any given time. Use less than 30% of your limit and you are considered safe. Few things you can do to manage this – pay your card in full, set reminder if you go over a certain threshold, maybe get your credit limit increased. Amount owed account for 30% of your score
o Don’t close unused card – The age of your credit history matters, and a longer history is better. If you must close credit accounts, close newer ones. Never close your oldest card or your first credit card. I still have my Amex card from 20 years back. Credit age account for 15% of your score
o Credit Mix – Spread your wings. Having a variety of debt – car, mortgage, students loan, credit cards, help your score. Sounds strange but that is how the world works. Credit mix account for 15% of your score
o Apply for new credit but smartly – New credit account for 10% of your score. It’s OK to occasionally open a new account, but if you are applying for several accounts in a short period of time, you will be considered a risk and it may impact your score
o Avoid maxing Cards out – Don’t max your cards. Also, when making payments, first pay down the maxed card
o Review your credit – Like a hawk, stay on top of your credit. You are entitled to one free credit report a year from each of the three reporting agencies. Take advantage of this and review your report. Dispute any errors that you find. Make sure you tell all the agencies. Fixing errors will improve your score

INVESTMENTS (affiliated links and portfolio)
Create new M1Finance account (get money): https://m1.finance/0ulBJlVUTwr9
Create new Robinhood account (get stock): https://join.robinhood.com/rajivm23
My portfolio on M1Finance (may change over time as I make adjustments): https://m1.finance/OiAV-96EOhhI
On Think Finance, you will find investment ideas and basics, retirement tips, money saving tips, real estate strategies, and ways to generate passive incomes and wealth.

Hi everyone, my name is Raj and my goal is to share ideas, learn from others and in the process help each other. If stocks, ETFs, investments, real estate, money, and personal finance are areas that interest you, do consider subscribing.

****Disclaimer****
I am not a Financial Adviser or Tax Professional, the information provided is my personal opinion and should not be considered professional advice. Ideas discussed on the channel are actions I am personally taking to hit my financial aspirations and not professional advice. I'm not responsible for any monetary gain or loss that may occur following information on the channel.

Видео How to improve your Credit Score. 800+? канала Think Finance - Raj