Would You Like Your Utility Payment History Added to Your Credit Report?

Recent years have seen a lot of backlash against the credit scoring industry.

Since the recession, many consumers are reducing their reliance on credit when it comes to making purchases.  However, the result hasn’t been what many expected.

Canceling accounts and swearing off credit can impact a credit score, sending it lower.  Not a good thing.

If you don’t plan to borrow money, it may not seem like such a big deal.  However, even if you don’t borrow, your credit report and your credit score might impact your financial situation.

Some insurers use your credit score as a factor when setting your premiums.  Landlords might check your credit when determining how much to charge you for a security deposit.  Cell phone and Internet service providers often run credit checks before setting you up.  Even a potential employer might ask for permission to view your credit report.

Many consumers who feel as though they are more responsible than ever are discovering that the credit scoring industry is just interested in encouraging, well, behaviors that involve credit.

But consumers feel that if a credit report and score are going to be measures of overall financial responsibility, non-credit payment items should be added to the list.

One of the items of interest right now has to do with adding utility payments into the equation.

Should Your Utility Payment History Be Part of Your Credit Report?

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Credit Sesame Review – Free Credit History and Score Monitoring, Powerful Tools to Have

Due to the increased interest in credit scores in recent years, it is little surprise that there are web sites popping up purporting to show your credit score for free.

And many of these sites do show you a credit score — although it won’t be your actual FICO score.

Credit Sesame is one of these sites offering you information about your credit situation, and even offering ideas for how you can save money on your debt.

Take a look at what Credit Sesame offers…

How Credit Sesame Will Help Your Credit

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4 Credit Report Errors That May Be Killing Your Credit Score

One of the reasons that you should regularly check your credit report is to double-check to see that you aren’t being held back by errors.

Credit report errors are fairly common, and in some cases can actually result in you having a lower credit score than you deserve.

I’m not talking a few points either.

There could be errors on their that seriously impact your credit report to the point where you aren’t getting loans.

The NYT reported on a woman who received an $18 million settlement from Equifax, one of the three main credit bureaus, because they confused her with another woman of the same name and didn’t take action when the woman tried to fix the problem.

The real scary thing was that it was shown that Equifax basically did nothing to investigate the errors when the woman made numerous disputes.  It’s bad enough when the errors show up but it’s even worse when nothing will get done when a legitimate dispute is filed (hence this woman’s large settlement).

This just shows you how diligent YOU, as the consumer, have to be to make sure there are no errors on your credit report.  You can’t make negative items that are real disappear.  But you better fight to get rid of the the items that are mistakes!

If you don’t take your credit accuracy into your own hands I can tell you that no one else will.

Here are 4 credit report errors that may be killing your credit score:

Credit report errors killing your credit score.

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Credit Karma: A Valuable Tool for Your Finances – Review

We’ve discussed credit scores here before.  You know how important they can be in your overall financial planning.   But how do you keep tabs on your credit without it breaking your bank?

Well, if you are looking for a free tool that can help you keep tabs on your credit situation, and gauge your financial progress, Credit Karma might be what you’re looking for.

What is Credit Karma?

Credit Scores

By visiting annualcreditreport.com, you can get access to one free credit report each year from each of the three major credit bureaus.  However, you are only entitled by law to a free credit score under specific conditions.

It’s important to understand the differences between your credit report and your credit score, and it helps to know your score as well as see your report.

Credit Karma is one of several web sites that provide you access to a consumer version of your credit score.
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What is Your VantageScore? And Does It Matter?

One of the things that becomes quickly apparent as you dive into the world of credit scoring is that there is no standard model.

While the FICO score is the most commonly used credit scoring model amongst lenders, there are other models as well, and even variations on the FICO score (how’s that for confusing?).

For the most part, the same information in your credit report is used to compile the different scores, but the weights given to different factors, as well as other proprietary information, are different.

One of the credit scores that you might run across as you look into your credit situation is the VantageScore.

Overview of the VantageScore

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eCredable Offers Consumer-Based Credit Scoring

One of the biggest complaints that many consumers have about the current credit scoring industry is that you are required to have credit in order to be approved for credit.

This means that, to some extent, you have to use debt in order to build your credit history.

Even though the point of credit scoring is to get a feel for how you deal with credit, many consumers are unhappy with the model. After all, there are plenty of consumers who don’t use credit cards, and pay for their cars with cash. They make rent payments each month, and utility payments. They pay their insurance bills on time.

They are responsible with their money, but many of the things they do aren’t reported to credit agencies. As a result, they end up unable to qualify for a loan when it really matters — like when they want a mortgage.

Enter eCredable.

This is a company that looks at your payment history on a variety of accounts, and uses that to create a profile of payment behaviors.

No credit is needed with eCredable.

Do Any Lenders use eCredable?

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Why You Should Regularly Check Your Credit Report

One of the realities of the current way that we interact with money as a society is that credit is important.

Indeed, credit history is one of the most important elements of your finances.  Building your credit is vital if you want the best interest rates, and even if you want lower rates for your insurance policies.

If you want to build your credit history, one of the easiest ways is to use a credit card.  Credit cards can help you build your credit, and improve the chances that you are approved for loans, and that you get the best possible interest rates on loans, saving you money.

However, just having credit cards isn’t enough.

You also need to keep track of what’s happening with your credit report.

What is a Credit Report?

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How Does Your Credit Report Affect Your Credit Score?

Your credit score is based on an algorithm that takes the information found in your credit report and reduces to a number.

Your credit history is the basis for your credit score, and it is important that the information in your credit report is accurate — and positive. Negative information in your credit report will bring down your credit report, and it could cost you money.

Sexy stuff, right?  But you need to know about them.  Below you will see how your credit report affects your credit score.  Understanding this is key to making sure you have a great credit score and get the best rates on loans as well as better rates on insurance and more.

What Effect Does Your Credit Report Have on Your Credit Score?

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Why Your Credit History is Important

One of the items that you have probably discovered in your efforts to improve your finances is that your credit history is important.

Your credit history, usually condensed down to a three-digit number known as your credit score, is used by a wide variety of financial service providers, especially those that lend money.

But why is your credit history so important?  And does it even matter if you don’t plan to borrow money?

Credit History: Your Financial Reputation

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What is Credit Utilization and Why it Matters

Your credit utilization is one of the most important aspects of your credit score.

Indeed, after your payment history, your credit utilization is the most important factor influencing your credit score.  For most people, credit utilization means the amount of available credit being used on a credit card.

What is Credit Utilization?

Simply put, credit utilization is the amount of money you are using on your credit card.  Your credit utilization is usually added up to include all of your credit accounts, and represented by a percentage.

Let’s say you have three credit cards:

  • Credit Card A: Credit line of $3,000, and a balance of $2,500
  • Credit Card B: Credit line of $2,000 and a balance of $1,800
  • Credit Card C: Credit line of $1,500 and a balance of $700

When all of the information is added up, you end up with with your credit utilization.

The total available credit in the above example is $6,500, and the balance used is $5,000.

To get the credit utilization, you divide how much credit you have used by your credit limit.  In this case, the credit utilization is 0.7692, or about 77% ($5,000 divided by $6,500).
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