Hello I am new to the community also young 19 years old and trying to figure out how I can increase my credit score so I can get approved for a new car. I recently went out and have had 3 credit pulls from different car dealers. The paper work they receive puts my credit score around 580-595, but when I check online at freecreditreport.com etc. it says my equifax score is at 605. I also have two loans and 2 credit cards out at the moment. Both my credit cards are low limits under $1000 and I have about 55% of one used and 35% of the other use. And I have a 10k current car loan and a $5k personal loan. I have never missed a payment on anything. I am about to just pay off the personal loan in the next week which has a remaining balance of $900, this would make the 3yr loan term paid off in 1 year. I am trying to get the new car here soon in the next month. I am wondering if I pay off this one personal loan will it increase my chances of getting approved for the new car loan. The new loan that I am asking for is about 22k for a 6 year term. I really want to do this on my own and not have a co-signer, and also I dont want to wait almost 6 months just for my score to go up to get approved. Is there anything I could do, besides getting the other credit card to 35% which wont be to hard. Also my Job situation is very good for my age and the monthly payment of what the new loan would be is only 1/8th of my monthly salary. So that is very easy for me to afford. So if anyone could help at all would be greatly appreciated.
Sorry for the previous post. I posted as a guest and could not see the replies.
First try to bring down the debt to 35% on both the cards because amounts owed accounts to over 30% in your credit score. The more is the amounts owed the lower is your score. Now since you are regular with your payments towards the existing debts, your credit history must be good. If you maintain these two factors for a period of 2 to 3 months more, you can expect your score to rise by a few more points, taking it over to 600. At 600 you can expect a favorable interest rate on any new line of credit.
The credit score may vary by a few points from one bureau to another and so it is not a problem.
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I know someone who works at a car dealership. He does Credit checks on those who want to finance automobiles. He was telling me, just because of the way the economy is right now, they won't finance unless your Credit score is at least 600 or over. However......it sounds like you are 'on your way', ADAM, to getting what you need.
I also think like scott that First try to bring down the debt to 35% on both the cards because amounts owed accounts to over 30% in your credit score. The more is the amounts owed the lower is your score. Now since you are regular with your payments towards the existing debts, your credit history must be good. If you maintain these two factors for a period of 2 to 3 months more, you can expect your score to rise by a few more points, taking it over to 600. At 600 you can expect a favorable interest rate on any new line of credit.
You are entitled to get a new loan if the track record is good. A credit manager would alwys prefer such a case even though your score is less. But you can certainly do a few more things to add on you score. You can either ask to incease your credit limit. You can also try a secured credit card. This will help you a lot. Are there any negative remarks on the report, try to remove them. Also you need to check that you do not ask for loan with more no. of enquiries. This could damage your score a bit.
Need Credit
There are literally hundreds of credit repair websites and a lot of them try to guarantee success but the reality is most of them are just a waste of money. They use methods of repairing your credit you can do yourself if you simply google credit repair templates. Their process is very lengthy and requires months and even years to get a lot of things removed and sometimes the bad marks can come back as some companies are very persistent, especially if you still owe them money.
The only guaranteed method to repair your credit is to pay off the old bills and get your derogatory balances to $0. "Well that isn't very helpful" is probably what you are saying. Since none of us just have cash laying around to do that there are other things you can do that are guaranteed to increase your FICO score practically overnight and start rebuilding your credit.
It's actually very simple. Sign up for Millennium Secured Credit Card and send them $300. Buy $90 worth of groceries on it and make the payments. Keep the balance under $90. Then sign up for alliedtrustdiamond.com and get a $10,000 unsecured credit card, buy something and make the payments. Do a google search for USA Shopping Club and sign up with them for $12,500 unsecured credit card buy something and make the payments, Eclub USA and get your $3,500 credit card and finally Horizon Gold and get your $500 credit card.
Once all of these companies report to the credit bureaus you are going to see an immediate increase in your FICO score. Guaranteed. Then you can work on getting the bad marks paid off and removed. It's much easier to get them permanently deleted if you don't owe them any more money.