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.   

What is Fair Housing? How to Spot a Fair Housing Violation? How to Avoid Discriminating?

Have you ever been searching for an apartment with your kids and due to working nights, you want a third floor apartment because the buildings have three floors but the leasing agent tells you that they only have first floor apartments available?  Or due to not being able to communicate well because you have a strong accent the apartment manager told you there were no homes available?  How about if you practice Islam and when you were wearing your hijab and they sent you to the scariest part of the apartment community?  Are you pregnant and you want a one bedroom apartment but the staff at the apartment community tells you they only have two bedroom apartments?  When you walk the community do you see that the Latinos are in one building, are the Whites in another building and the African American families are on another part of the community?

The United States Federal Government has a law that protects citizens in the United States, regardless of immigration status, of any discrimination in the sale, rental, and financing of dwellings, and in other housing-related transactions, based on race, color, national origin, religion, sex, familial status (including children under the age of 18 living with parents or legal custodians, pregnant women, and people securing custody of children under the age of 18), and disability.  This law is called Title VIII of the Civil Rights Act of 1968 (Fair Housing Act), as amended.  Each local and state government may have additional protections.  In the state of Maryland “marital status” and “sexual orientation” are protected classes.

In some instances, owners are allowed, within the law, to discriminate against certain individuals.  Owners of a single family home, that is their primary residence, may reject a tenant for rooms based on sex, marital status and/or sexual orientation.  As well as an owner of a building of five or fewer rental units who occupies one of those units may also reject applicants in the three categories mention above.  Additionally, religious organizations, private clubs, people convicted of manufacture and selling of illegal drugs, communities for people above the age of 55, and owners not renting to families larger than what the fire code dictates.  They can discriminate as well as long as they do it to everyone, in a constant basis and do not violate their own by-laws.

Discrimination against you for seeking a home for sale, rental and financing to purchase a home is illegal. If found to have been discriminated, owners and the person commiting the discriminating offense can be sued and fined millions which may include jail sentence.

If you feel that you have been discriminated against there is help.  Baltimore Neighborhoods Inc is the local non-profit organization that helps promotes justice in housing for all people in the State of Maryland, with the exception of Montgomery County, through fair housing and tenant-landlord programs and public information activities.

If you have any questions, concerns or file a complaint you may contact Baltimore Neighborhoods Inc by visiting their offices located in 2530 N. Charles Street, Baltimore, MD 21218.  Their phone number is (410) 243-6007 or (410) 243-4400.  You can learn more by visiting their website at www.bni-maryland.org.

To learn more about Fair Housing, a federal program governed by the US Department of Housing and Urban Develpment  and submit a complaint you can visit their website http://goo.gl/1BnbN2

The best way to avoid these types of situations is by buying your own home.  If you would like to buy a home please give me a call for a free consultation or meet me in person at the Southeast CDC Home buying workshop in Spanish on Saturday January 17 from 9AM to 4PM.

Nathalia Cruz-Edmonds is a Realtor with PS International Team of Berkshire Hathaway Homesale Realty and she is also the owner of Clearview Real Estate Management LLC.  To speak to her you can email her at nathaliaedmonds@gmail.com or call her at (410) 350-5848.

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

Take Action ~ Be Fearless

Fear paralyzes people.  Fear of rejection could have led you to meet your husband/wife.  Fear of sounding stupid could have led you to solve a big mystery or answer someone else question.  Fear of the unknown could have led you to a new adventure that would have made you happier or richer.

I run on fear.

The adrenaline rush that I get when I don't know what is around the corner makes me happier and it produces the greatest adventures.

I asked my husband out.  I met him FOUR months before our first date.  A week before our first, and last date, I asked a coworker of his about him.  This coworker stated that, my now husband, liked me.  Therefore I told his coworker, give him my phone number.  After 24 lousy hours of hard to get, I asked him out.  We have been together for five years and four years married.

You have to work hard for things that will bring you the greatest joy.  You also have to trust in GOD when the path is very dark.  God said "For I know the plans I have for you, declares the Lord, "plans to prosper you and not to harm you, plans to give you hope and a future." (Jeremiah 29: 11 NIV)

My Alma Mater Seton Hill University slogan is "HAZARD YET FORWARD".

Keep trucking my friends!

-Nathalia