Repair your credit plan

1.Know your credit score!
The first step in controlling your debt is knowing your credit score.

a)What is a credit score?
Your credit score is a three digit number ranging from 300 to 850
that is the key to your borrowing costs.
(*)Why is your credit score important?
A credit score is used by a lender to help determine whether a person qualifies for a

particular credit card, loan, or service. Most credit scores estimate the risk a
company incurs by lending a individual money or providing them with a service
specifically, the likelihood that the person will make their payments on time in the
next two to three years. Generally, the higher the score, the less risk the person
represents.

b)How often should it be checked?
Financial experts say that you should check your credit report at least once a month.
Creditors send updates to the credit bureaus once every month. Therefore, your account
information should be updated once a month. If you are expecting a change in one or more
of your accounts, or if you are closely monitoring your credit history, you will need to
check your credit report more often.

c)How does checking your credit affect your score?
There are two types of credit inquiry:
1)Soft Inquiry:
When you check your own credit it is known as a "Soft Inquiry", this will not hurt your
credit.
2)Hard Inquiry:
When you apply for credit through a lender and they check your credit this is known as
a "Hard Inquiry", this will lower your credit score slightly. However, don't be
concerned about multiple credit applications for a mortgage over a six week period
because multiple inquiries over a 45 day period are typically treated as a single
inquiry.
(*)For your information...Married couples generally maintain two separate credit records
and histories. However, if you decide to take out a loan with your spouse, all payment
history from then on will be recorded on both credit reports.

d)Checklist of knowing your credit score:
1)Know your credit score and check it often. www.annualcreditreport.com
2)Remember, applying and getting turned down for credit lowers your score.
3)The higher your credit score, the better your chances are for getting low APR
and overall financing for houses, cars, loans and credit.

2.How to get your credit score:
You are entitled to one free credit report annually by law!
After the initial one per year you will be charged a fee to get it.
The fee usually runs about

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