You've got questions about money, I've got answers.
Let me start with a brief Q&A on some basics:
Q: What's a credit report?
A: A credit report is a resume of your finances, if you will. It contains your name, address, social security number and some employment history. A credit report combines a mix of types of credit in use, new credit (and inquiries for new credit), length of credit history, amounts owed, and payment history to give you a "score". A high score on a credit report will result in lower costs to borrow money and other benefits. A low score will result in higher costs, and sometimes inability, to borrow money. A credit report contains all accounts open, closed or cancelled in your name. A credit report also reflects bankrupticies, liens, evictions and other delinquencies. Information appears on your credit report for seven years (except bankruptcy, which reflects for ten years). High debt to income or bad credit can be extremely detrimental in your future, yet, it's very simple to avoid this scenario.
Q: What's the big deal about your credit report?
A: A credit report is more influential than ever before.
More than just used for buying a home or a car, your credit report can be pulled when renting an apartment or for something as simple as buying a cell phone. Increasingly, employers are using credit reports as part of the hiring process. If you are educated about money and learn from the beginning that demonstrating positive money management is key to success of your credit report, you can start from day one doing things to build your good credit and avoid the set-backs caused by bad credit.
Q: How do I get good credit?
A: If you do not have any credit, your credit score is pretty much middle of the road right now. You don't have "good" credit or bad credit yet. Your job is to take steps to push your credit score higher and higher to build good credit. One key is demonstrating positive money manement and avoid taking on more than you can handle in the beginning. I'd go so far as to encourage you to avoid credit card use until you are proficient with them and knowledgeable about how to make good decisions with money in general. Building good credit takes time and responsible spending decisions and is extremely beneficial in your future.
For in depth information about how & why to avoid credit card debt, how to correctly use a credit card, and simple basics on how to get ahead with your money, you should GET A COPY OF THIS BOOK!
More questions? Follow my daily webBlog for thoughts on debt today & more answers to money questions. If all else fails, email me! I'll get you an answer.
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