Welcome to the LindaSecrist.com Blog

2011-06-16 16:40:42
6 Red Flags You May Not Know That Effect Your Cred

6 Red Flags On Your Credit Report You May Not Know (edit/delete)

Are you not able to get that Salt Lake City home for sale, Murray townhome, Holladay luxury estate, Sandy 2-story, Draper rambler or Herriman ranch you had hoped to purchase because you can't get a loan?  Or, maybe you aren't qualifying for the lowest interest rate available?  Well, aside from the commonly known mistakes, such as missed or late payments, loan default, too many credit cards with too high of balances, here is a great article about SIX additional common mistakes Utah home buyers may have made and not even known these mistakes could be keeping them from getting the right loan at the right interest rate and terms.  It's important to know your credit, keep an eye on it for any possible fraudulent activity and to know the best ways in keeping your good credit. 

 

As read on Comcast:

You pay your bills on time and never miss a payment. If you're still having trouble with credit, something on your credit report could be scaring lenders. Everyone knows the big gremlins that haunt credit reports: items such as bankruptcies, foreclosures and even late or missed payments. Less dramatic items can also spark some anxiety in skittish lenders.

When you apply for a loan or a card account, lenders review your credit score and pull your credit report. Or they may take that report and pump it through one of their own scoring systems. If they don't like what they see, you could be rejected. Or you may get approved with less-favorable terms. And it isn't just new applicants who have to run the gauntlet. Credit card issuers periodically review their current customers' files, too.

Even more confusing is that different lenders zero in on different credit report items. So it's entirely possible that, even for the same loan, no two lenders will see your credit history in exactly the same light.

#1 - Multiplying lines of Credit:

Opening one new card is normal. Opening three in a short amount of time could signal something bad is going on in your financial life.

When it comes to credit card issuers, 'the account monitoring window has shrunk,' says Norm Magnuson, vice president of public affairs for the Consumer Data Industry Association, the trade association for credit reporting companies. 'It used to be months and months. Now you find companies doing account monitoring monthly or every other month.'

And the one thing those issuers don't want to see is that you're asking everyone in town to lend you money.

'That would raise some questions,' he says. 'It could be an indicator of something that's going on. I don't think it's in the best interest of any consumer to go out there and be a collector of credit lines.'

#2 - Housing Shortsale:

'People are told short sales won't hurt their credit,' says Maxine Sweet, vice president of public education for credit bureau Experian. 'But there is no such thing as a 'short sale' in terms of how the sale is reported to us.'

'The way the account is closed out is that it is settled for a lesser amount than you agreed to pay originally,' she says. 'The status is 'settled.' And it's just as negative as a foreclosure.'

One tip: Negotiate so the lender doesn't report the difference between your mortgage and what you repaid as 'balance owed' on your credit report, says John Ulzheimer, formerly of FICO, now president of consumer education for SmartCredit.com. Your credit score will take a heavyweight hit, but this action will slightly soften the blow, he says.

Sweet's advice is not to discount the notion of a short sale, just go into it with your eyes open.

'It may be the right decision to get out of the house,' she says. It may be 'better than a foreclosure in terms of the economy, moving the house and moving on with your life. Just don't expect to walk away with no impact to your credit history.'

#3 - Someone else's Debt:

Here's something you might not know: When you co-sign on the dotted line to help someone else get a loan or a card, that entire debt goes on your credit report.

While the fact you've co-signed is neither good nor bad, it does mean that -- as far as any potential lenders are concerned -- you're carrying that debt yourself. And it will be included in your existing debt load when you apply for a home mortgage, credit card or any other form of credit, says Ulzheimer.

And if the person you co-signed for stops paying, pays late or misses payments, that bad behavior will likely go on your credit report.

So when someone tells you that co-signing is painless because you'll never have to part with a dime, you can tell them that's not true. Co-signing means agreeing not only to repay the obligation if necessary, but also to allow the debt -- and any nonpayment -- to count against you the next time you apply for credit yourself.

Co-signing for a friend or family member 'plays well at the Thanksgiving table, but it doesn't play well in the underwriting office,' says Ulzheimer.

#4 - Minimum Payments:

While creditors make money when you carry a balance, lenders who view your credit report don't like to see you paying just the minimums.

'It suggests you're under financial stress,' says Nessa Feddis, vice president and senior counsel for the American Bankers Association. 'You may be defaulting,' she says.

Paying minimums once in a while doesn't necessarily signal a problem, she says. For instance, paying minimums in January, after holiday spending. Or paying minimums one month as you wait for your annual bonus to arrive.

But consistently paying minimums month after month signals that you can't pay off the full balance, and your current and future lenders will see that as a giant red 'stop' sign when it comes to granting additional credit.

#5 - Too Many Inquiries:

This is similar to soliciting a lot of new credit. When lending standards tightened, a lot of borrowers, especially subprime borrowers, were having trouble getting credit, says Sweet. That meant that they had to apply multiple times to try and get what they wanted.

And, with the VantageScore at least, that 'actually influenced the impact of inquiries -- they are more important than they used to be,' she says.

With the FICO score, the impact of inquiries has remained about the same, according to Ulzheimer. Every time you allow a potential lender to pull your credit report, your score can take a small hit. The exact impact varies with the consumer, the score and the number of inquiries.

And if you're applying for a home, auto or student loan, you can minimize the damage by making all of your applications within a two-week period. When you do that, the score bundles all the similar inquiries and treats them as one. Unfortunately, there is no similar grace period for credit card applications.

#6 - Cash Advances:

'Cash advances, in many cases, indicate desperation,' says Ulzheimer. 'Either you've lost your job or are underemployed. Nobody takes out cash advances against a credit card because they want money sitting in a bank somewhere.'

Because the interest rate is generally higher than for the credit card charges, 'you're generally borrowing from Peter to pay Paul,' he says.

How it hurts: First, the cash advance is immediately added to your debt balance, which lowers your available credit and can lower your credit score, says Ulzheimer. And all potential lenders will see your score.

Second, larger card issuers regularly re-evaluate their customer's behavior. To do that they often pull the credit report, the FICO score and the customer's account history and put those three ingredients through their own scoring systems, says Ulzheimer. Many of the those scoring models penalize for cash advances, which are often seen as risky, he says. Since your account history is available only to that issuer, only your behavior score with that card is likely to be affected, he says.

However, if the issuer slices your credit line or cancels your account, that could impact your credit score. And that could affect your relationship with other lenders.



LINDA SECRIST - LINDA SECRIST & ASSOCIATES - EVERYTHING THEY TOUCH TURNS TO SOLD!

www.lindasecrist.com
www.newutahrealestate.com
www.saltlakehomedirectory.com

FOLLOW US ON FACEBOOK

Salt Lake City real estate, SLC real estate, Salt Lake City homes for sale, SLC homes for sale, SLC Realtor, Salt Lake City Realtor, Holladay luxury homes for sale, Holladay luxury estates, Holladay homes for sale, Holladay Realtor, Cottonwood luxury estates, Cottonwoods Realtor, Walker Lane, Cottonwood Lane, Sandy real estate, Sandy Realtor, Draper real estate, Draper Realtor, Sandy homes for sale, Draper homes for sale, Murray real estate, Murray homes for sale, Murray Realtor, South Jordan real estate, South Jordan homes for sale, South Jordan Realtor, West Jordan real estate, West Jordan homes for sale, West Jordan Realtor, Riverton real estate, Riverton homes for sale, Riverton Realtor, Herriman real estate, Herriman homes for sale, Herriman Realtor, Utah real estate, Utah homes for sale, Utah Realtor, Bountiful real estate, Bountiful homes for sale, Bountiful Realtor, Davis County real estate, Davis County Realtor, Park City real estate, Park City homes for sale, Park City luxury homes for sale, Park City luxury estates, Park City ski homes, Park City retreat homes, Park City Realtor, Alpine real estate, Alpine homes for sale, Alpine Realtor, Highland real estate, Highland homes for sale, Highland Realtor, Farmington real estate, Farmington homes for sale, Farmington Realtor
 
Blog Archive
2017-06-21 10:11:01
UTAH HOME TOURS- June 24 & June 27, 2017

2017-06-15 09:46:53
2 Super Saturday and 3 Twilight Tuesday Open Houses

2017-06-07 10:34:39
'Super Saturday' and 'Twilight Tuesday' Are Back!

2017-05-31 14:36:45
4 LUXURY HOME TOURS, Saturday June 3, 2017

2017-05-31 09:23:57
The Best & Worst Place to Start A Career

2017-05-24 10:22:55
2 New Luxury Open Houses- Saturday, May 27, 2017 12-3 PM

2017-05-18 11:39:05
5 LUXURY HOME TOURS, SATURDAY, MAY 20, 2017

2017-05-16 11:53:33
Utah Is The Best In State

2017-05-10 10:35:31
GRAND OPENING! 'The Villa's @ Dimple Dell'

2017-05-01 10:19:22
Utah hasn't forgotten the power of free enterprise

2017-04-27 10:55:28
3 Luxury Home Tours- Saturday, April 29, 1-3 PM

2017-04-24 09:32:18
Utah # 1 In Nation In Economic Outlook

2017-04-19 09:40:25
5 Luxury Open House Tours

2017-04-17 09:54:55
NEW CONSTRUCTION IN SALT LAKE

2017-04-12 16:40:16
3 LUXURY HOME TOURS, APRIL 15, 2017

2017-04-11 11:56:27
2 Fabulous Draper Open Houses, Saturday, April 15,

2017-03-31 13:25:33
Salt Lake City Tops List

2017-03-16 14:48:47
'TAKE A PEEK!' NEW IMMACULATE SANDY LISTING!

2017-03-01 10:53:05
New Listing- Luxury home in Draper, amazing views

2017-02-21 09:55:06
Salt Lake City In The News

2017-02-15 09:34:26
Salt Lake area one of US’ best places to live

2017-02-06 15:35:35
And 2017 IS OFF WITH A BANG!

2016-10-25 12:44:05
Fall Activities in Salt Lake City

2016-10-10 10:46:51
WHISPER RIDGE

2016-09-08 13:39:02
Silican Slopes vs. Silicon Valley

Click here to see ALL articles.


Comment on this Article

Your Name:
Your Email:
Comments:
Verify:  Please enter the numbers shown to help eliminate spam.