Credit Scores

Even if you’re doing everything in your power to improve your credit score, you might find that it doesn’t appear to be getting any better. There are many reasons why a credit score might hit a plateau and not improve. Here are just a few.

1. Negative aspect of your past coming back to haunt you. If you experienced a heavy financial hit on your credit in the past, like declaring bankruptcy or a foreclosure, you may still be haunted by the ghosts of that moment. Usually big moments like this take about seven years to wear off.
2. High credit card balance. While making payments on time helps your credit score, having a large outstanding balance will ultimately drag you back down. The best thing to do is keep your revolving credit balance low.
3. Your credit score has an error on it. It might not even be your fault that your score seems to be struggling to improve. Check your free annual credit report regularly to ensure that there’s nothing inconsistent or fishy going on.

Image via The Finance Genie.

Many think that once they’re retired, they’re able to relax on all fronts, including in regards to their credit scores. However, that is absolutely not the case.

Many retired individuals are still indebted, increasing from 30 percent to 46 percent from 1998 to 2010. Additionally, many people over 50 have medical expenses paid through their credit cards, which also increases their debt. If someone is paying attention to their credit score, however, they’ll be able to qualify for lower rates, which in turn will help them decrease their debt quicker.

On top of that, older individuals are more susceptible to identity theft. However, those that are paying attention to their credit scores and notice a change are quicker to recognize and put a stop to identity theft.

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If you’re looking to get a credit card that has great benefits and rewards, then you’ll need to ensure that you have the right credit score. So what is the right credit score to get you there?

Ted Rossman, industry analyst at CreditCards.com, said, “We typically see at least a 670 required for the best rewards credit cards.”

If you have a score lower than 670, however, you’ll end up having to get a card with less rewards and perks.

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Image via Decatur Earthmover Credit Union.

Having a credit score that qualifies as “good” can make all the difference on your future, especially when it comes to taking out a mortgage. People who have credit qualified as “excellent” can have 1.5 percentage points lower on their mortgage rate compared to someone with worse credit.

Knowing your credit score is helpful in this regard, and if you’re considering taking out a mortgage with poor credit, you might want to reconsider and look into options for building your score before doing so.

Image via PYMNTS.com.

You may think you can’t qualify for a credit card if you have bad credit, but many card companies offer unsecured credit cards specifically for consumers with less-than-stellar credit. While these cards often come with some restrictions, responsible use of them can help you repair your credit score. Click below for recommendations on the best cards for those with bad credit.

Image via Flickr/Nathan Baney

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If you’re suspicious of an error on your credit report, it’s important to take action. The first step is to pull your credit report. You can easily get one for free at annualcreditreport.com. Next, go through everything to see what’s accurate and what’s not.  

Take a look at things that are in collections or anything else that’s negatively affecting your score. Once you’ve spotted any items that you disagree with, it’s time to file a dispute. To file an official dispute, you should contact all three major credit reporting agencies since they are the ones who will expose your history to potential creditors.

A 640 credit score is considered fair. Many lenders will still give you credit,  however you won’t have the best rates. With a 640, you can still get a house and car loan. You can certainly get credit cards as well. However, you won’t be able to get many of the perks people with 700 and above get.

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