Credit Tips

When applying for credit, whether it’s a credit card; a car loan; a personal loan or a mortgage loan, the lender will want to know your credit risk level. To understand your credit risk, most lenders will look at your credit score and credit history. Your credit score influences the credit that’s available to you, and the terms (interest rate) that lenders will offer you. It is a vital part of your credit health. By knowing how your credit risk is evaluated, you can take actions that will lower your credit risk, and thus raise your score over time. A better score means better financial options for you.

Spinnaker Financial Home Loans – Specializing in Home Purchase, Refinance, Construction Loans, and Home Equity Loans in the Atascadero, Paso Robles, Templeton, and all Central Coast Area.

Credit Tip #1: In any given three-month time period, only about one in four people has a 20-point change in their credit score. That is why it is a good idea to check your score 6-12 months before applying for a big loan, so you have time to take action if needed.

Credit Tip #2: Pay your bills on time. Delinquent payments and collections can have a major negative impact on your score.

Credit Tip #3: Keep balances low on credit cards and other “revolving credit”. High outstanding debt can affect a score. On the same note, don’t close unused credit cards as a short term strategy to raise your score.

Credit Tip #4: Be aware that paying off a collection account, or closing an account on which you previously missed a payment, will not remove it from your credit report. The score will still consider this information because it reflects your past credit pattern.