What is the FICO Credit Score? Why do I need good credit?

Tu Casa

By Nathalia Cruz-Edmonds

The best way to obtain anything material or services in life is with cash.  If you don’t have cash, you may be able to obtain them with credit.  Credit by definition means to obtain an item or services before payment based on trust of future payment, but not everyone can get credit.  Some individuals cannot get credit because they are too young, they never had credit before, they have bad payment history, or they don’t make enough money.  But what is credit?  Why do you need it?  Who created credit?  But why is it soo important?

Due to the fact that the majority of individuals do not have $30,000 in cash in the bank or under a mattress to buy a brand new car or $250,000 in cash to buy a home, people rely on banks, investors, family members and other ways to borrow that money so they can obtain stuff and then they will pay whom lend them the money later with or without interest.  Credit is needed for various reasons but mainly to borrow large amounts of money.  Others, such as landlords and employers, use it to see your payment history because when you pay on time it translate that you are responsible and trustworthy.

In 1956 Bill Fair and Earl Isaac founded FICO in San Jose, California.  They started a software company that measures the consumer’s credit risk and worthiness.  The FICO Score which is a given value to the consumer’s credit risk and worthiness was introduced in 1989.  The score ranges from 300 to 850.  Depending on where your FICO score lands will dictate if (1) you will be able to borrow any money (2) How much your security deposit will be, if renting a home (3) How low or high your interest rate will be and (4) How much money you will be able to borrow.

Each individual credit score consists of several items:

• 35% Payment History - As agreed with the lender, do you make your payment before or after the scheduled date?
• 30% Debt Burden - How much money have your borrow and how much do you still owe
• 15% Length of Credit History - How long have you been borrowing?
• 10% Type of Credit Used - Do you have credit cards, personal loans, car loans, mortgage,
• 10% Recent Credit Searches - Are you shopping around to get credit?

Currently there are three companies that provide you with scores, Experian, TransUnion and Equifax.  The majority of banks when pulling your credit will pull all THREE credit score companies and pick the middle score.  Do you know what your credit score is?  By law, each credit score company will provide you with a ONE FREE credit score a year.  It is imperative for you to use this free service because you want to make sure your information is correct.  Meaning, all payments have been reported correctly, no new accounts have been added.  A great free way to monitor your credit is by creating an account with Credit Karma, www.creditkarma.com.  You might not see all three Credit Bureaus but you get a good overview which you can monitor monthly for FREE!

There are some cool tricks to help you keep your credit score high besides paying your debt in time!  If you have a credit card, maintain the balance below 10%.  So, if you have a $1,000 credit card with Bank of America.  You should keep your balance lower than $100 every month.

If you had some issues in the past where you lost your job and couldn’t pay on time, if it has been more than seven years, you are allowed to ask the Credit Bureau to remove that trade line from your credit history!  If you have a trade line that is older than seven years but you paid on time, DO NOT REMOVE IT!

If you do not have savings, having a good credit history is important for others to lend you money!  The internet have instructions and ideas on how to clear your credit BUT if you do not have the time and need your credit score improved in less than 9 months there are companies that can help you.  Max Score Credit (www.maxscorecredit.com) is a minority owned company with offices in Silver Springs and Baltimore who can help.  They will pull your credit and help you contact the Credit Bureaus to correct any incorrect information by not adding information that can potentially harm your credit.  For more information contact Ana Garcia, Senior Credit Advisor at 410-864-8600 or via email at agarcia@maxscorecredit.com.  Their rates are reasonable and their results are life changing.

If you would like to learn how to buy a home and create a plan to achieve it, please give me a call at (410) 350-5848.

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Nathalia N. Cruz-Edmonds is a REALTOR with Berkshire Hathaway HomeService PenFed Realty.  To schedule a meeting call (410) 350-5848, at her office (410) 464-5500 or via email at nathalia.edmonds@penfedrealty.com.  You can follow her on Facebook at http://facebook.com/NathaliaEdmondsRealtor.   

Finally! I was lost but now I have a compass!

Finally!  I was lost but now I have a compass!  On Friday June 13, 2014, only three days before my 32nd birthday, I was told my employment with Morgan Properties was terminated.  All I could think of was "But I just ordered my birthday cake!"

 

It is Thursday October 2, 2014 and I can say that even though I have been unable to find my path, I have a good compass and a set of tools to navigate through life with my head held up high!  The path wasn't easy but it was crowded with the right people.  In the beginning it was hard to see because I had my head up my behind.  I still can't see but my compass is guiding me the right way!

 

How do I know?  Because I am happy!  I feel productive!  Creativity is coming in slowly.  I'm excited about my future!  So this is what I have been doing:

 

1)  Sold my first house on Sept 4th

2) Opened my 2nd Property Management Company for HOA/Condo Associations

3) Have written a lot of contracts!

4) Have a business coach

5) Have a real estate property management mentor

6) Going to counseling

7) Started drawing

8) Have a part time job being concierge at a Luxury Apartment Complex Downtown

10) Wore my PINK hard hat at a solar panel farm!!

 

 

 

11) Cut my hair!!

12) Will be going to Puerto Rico in November

 

My husband and I went through a couple of hick-ups but his disposition to make things work is fabulous!  We accept we communicate differently and make adjustments.

 

As for my real estate sales, slowly but surely!  Went to the Dundalk Housing Fair last Saturday and we got 20 leads!  Sent emails out today!  I  have been sending  my FSBO (For Sale By Owner) care packages!  They are a riot!  Been following up with them too!  Third and Second letters going out on Monday!

 

My mother was operated on yesterday fixing her right wrist which she fractured about two weeks ago.  It was a hard long way but finally it's done.  She is in a lot of pain, which I wish I could take away and make her feel better and have her laughing.  Not having someone laugh, when that's what is what they usually do, it's heartbreaking.  But God is a healing God, by Jesus's blood she will be healed!  She will use that hand to heal others and to bring them blessings!

 

 

Thank you for visiting will be writing more often!

 

Your Friend, Nathalia

Going all the way! Million Dollar Style

So, one of my best qualities and also my worst is being ABRASIVE.

 

Men don't like it.  People that don't pay their rent on time don't like it.

 

But it has gotten me a job, fabulous connections that are now friends and a husband.

 

Therefore I am not changing.

 

I love watching Bravo's Million Dollar Listing New York, specially because of Luis D. Ortiz from Douglas Elliman.  He is Puerto Rican, very handsome and a real estate agent.  It's like me but the female version.  I love his passion, dedication and pursuit of the American Dream.

 

So that got me thinking, I wonder if the Maryland Hispanic Business Conference has someone to be the keynote speaker.  And wouldn't it be FABULOUS to have Luis D. Ortiz to be that person?

 

Another fantastic quality of mine is research.  I went to the Douglas Elliman website and BAM!  With my abrasiveness, I emailed.

 

With in minutes I got a CALL from a lady that works with him.  Stating "Luis wanted me to call you and let you know of his speaking fees."  Mind you, I was on the other phone speaking to a client of mine.  So, I put my other client on hold and I speak to Luis' representative.  I let her know I am a board member for the Maryland Hispanic Chamber of Commerce and we are involved with the annual Maryland Hispanic Business Conference that is scheduled for Tuesday September 2nd in Bethesda Maryland.  She said she will email me her contact information in the event the board decides they would like Luis to be our keynote speaker.

 

I felt like I was back at a Menudo concert in Bellas Artes, San Juan Puerto Rico. 

Screaming my lungs out.  Jumping uncontrollably.  Counting my blessings.

 

There you have it.  Don't just dream it. Plan it.  Execute it.  Live it!!

 

There is NOTHING TO FEAR, for you and I have Jesus Christ to strenghtens us!!!!!

 

I will soon reveal what EODG means!!