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But this is GW from.
From Nebraska -- from Wisconsin I guess there's more of a problem -- in the credit score is even if you try to clean underscores takes three years seen a team.
And clean it up that's the parliament in cleaning mine have been found there's nothing I can do to expedite.
Is it really just time.
Considering on the circumstances seeking credit score you know I think that's a -- it's misconception that it takes.
An inordinate amount of time in order to clean up your credit score did you feel like a bad person -- and attended every year.
And then maybe you'll get out of it I mean it doesn't feel that wealth for lucky like.
It does its frustrating for them because they think it's a longer process.
But I think some of it is because.
Other things are going on in their credit file.
Behavior they may be doing that they don't realize they -- is actually hurting the Democrats for -- -- -- -- -- start for example.
Only apply for credit when you really truly needed under five -- credit -- model for example.
10% of your credit score is based on inquiries or new applications for -- 15% of your credit score is based on.
The length of your credit history so sometimes of people pay off -- they might close out in the -- That actually has a tendency to hurt your cycle credit score it felt a little counter intuitive.
But that's something you -- do just paying down your credit card balances 30% of your score is based on -- the amount of debt you've charged.
First is how much credit you have available so if you keep you know running up those credit cards needless to say that is going to have a tendency of lowering until I didn't get one just in case.
That glove Sony people like that though the -- who say all I gotta get a credit card.
To build up credit that's a myth right ultimately admit it is a -- because there are several strategies you can use.
Not take on any debt whatsoever.
One -- is piggy backing for example.
In other words you can be added as an authorized user on the account of someone who.
Has an established.
Track record okay so I've done this and -- add that because she's a story when we've seen high school my my mother said -- need to develop some credit I'm gonna put you on my credit card Napa.
My mother and they gave me her credit -- to use for any reason this is putting on there Clinton is looking at my credit record recently I saw that.
I had a names whenever carts and she had a unit -- years it's just collecting dust that many times so.
What do you do having is that something that -- something positive for you as a matter of fact I -- -- I think Obama the UK.
I've always been paying very little ahead because what -- did is it lengthen the average age of your accounts which is a measure that cycle at least Fair Isaac looks at.
To determine your what should be your credit score so that's a good thing.
Outside of piggybacking though there are also -- is that people can use to.
Get a good credit score to establish a credit rating and not take on day one of them is that they can use a service like.
Payment reporting builds credit PR BC dot com is their website they have an affiliation of some sort.
With a Fair Isaac.
Essentially people who have non traditional.
Payments that they make rent utility bills maybe they're paying missed a day care provider etc.
They -- -- payments into their system and they show listen even though I don't have a student loan or car loan or credit card.
I have these non traditional payments that I'm making.
But this shows you that I'm a good risks because I'm making my payments on time month after.
If you are BC dot Arnott -- -- these -- -- out and everywhere in bill's credit can't tell you because when I had correct I mean you can repair a of course we're very quickly as I was saying anything.
And over -- learns about you so there's about one have billion pieces of credit data reported a month.
And -- and our algorithm.
Payment history is 32% growth of plus or minus.
Influencing the score.
If you pay your bills on time you can get back on track very fast start -- -- give -- a system that's the number one determinant in recent cycles model and it's pretty similar with the vantage -- 35 pager your elbow or must pay all your bill I thought -- score is based on your payment track record.
Okay how well do you pay your bills on time if you do nothing else but pay bills bills on time and everything else in your credit file maintains the same.
Six months or so you talk to see those Michael scores of -- credit scores and general improve lets us.
And after about six others -- you really have very good about six months of time if you're even if you have a bit pretty rough score me give me an example in terms of numbers if you have one maybe from your model that somebody isn't.
In tough she's tough times could do it could do something very quickly.
Plug and pay their bills now I think had a bankruptcy it takes -- that kind of come back because the severity right involved north has been for closure for example or a legal action but just somebody -- a lot of credit card debt.
If you pay your bills on time and come back very fast and that's interest and that's you know I think things have changed.
Dramatically just from reading the comments of people ever -- people written in cash is King and I don't need credit.
-- being what are you guys sense to me you working in the industry in dealing with consumers all the time about changing patterns of people's perception of debt.
Do you you.
A willingness to go into debt now verses before five years ago and it seems dramatically different going here but now I'm going forward from here -- -- it.
It absolutely is -- obviously it's because of them sort of economic meltdown that -- -- that people are in fact saying I've got to get back to the financial basic I've got to learn how to.
Create and stick to a realistic budget I really -- have to learn how to manage.
Credit -- debt wisely -- got to save more those kind of things I've written two books about just the debt credit card debt and you know student loan -- what I'm -- from people is that debt is still for many many families the number one financial problem that they're facing.
Huge amounts of student loan -- about 20000 dollars on average for the typical college grad.
Goals just -- undergraduate school mortgage debt nationwide average is about.
Dollars of course and in our neck of the woods in the northeast it's much much higher -- even.
Even auto loans now top 25000.
Dollars on average so -- is a big big issue for America.
Can veto what does it seems very two -- that we ought to keep hearing is that these scores are not going to be as important anymore and that really the loans are going to be judged -- The old fashioned way and your character -- get one from bank for example I mean with some of these big credit card companies he -- necessarily need a representative.
What do you think about that.
Actually -- think the obvious that this of the -- cycle and that lenders who we think other models.
And if you have a and -- -- new tools in the marketplace because the higher debt burdens.
So lenders are really look rethinking their models that are processes right now and now models are highly predictive.
We'll look you know capital -- -- Reserves for dear right now so banks and lenders need to reach out to more score -- people.
To access mainstream credit.
It's another predatory lenders so this is a great time for a pretty -- Didn't even try to do something about Al -- that I still there and understand that it's it's still seems like we can get ourselves easily and the problem that we were just -- -- -- -- there's only so much an algorithm can tell us about some personal situation right fit.
This to a certain extent absolutely there's no question about that but I.
I a hundred.
Person agree with what he just said I think credit scores are going to become more important in the future not less so in many different ways.
One reason frankly is that I think that what lenders have started to discovers something diluted -- earlier is that you can't just use the the score of course as the sole determinant but it really does tell you a lot about a person's.
Financial behaviors right or wrong you brought up the issue of character or judgment I don't kind of known -- money.
I've heard from many many bankers who make the case that -- cycle scored does tell me something about your character for example it tells you.
Whether or not you honor your obligations if you signed a contract you agreed to pay alone.
At a stated interest rate at a given point in time have you.
Done what you think you're gonna do right that's why employers even rightly or wrongly.
Employers are even looking at people's credit files in determining to whom they should extend the job they're thinking -- If you -- your obligations and chances are you gonna be a good were -- translate that to say you'll be at work on time you'll turning your assignments on time.
You'll meet deadlines excel are still there right there -- they do associated with your car to look at the very kids are your friends do you have made -- Check your credit notified by having our entire I have to re taking your -- -- -- -- at a category of.
There's a positive side the consumer debt if -- used prudently anywhere we'd be without a mortgage or car -- student loan facility that the I -- an exceptionally right you have to measure that prudently and has been.
The -- to prudently as well.
Yet that's what I -- earlier about this whole change and in.
It now look I wonder whether it's it's all good I mean we always go too far.
The other way when -- -- -- and didn't a couple of years ago most of us looked at debt in general -- kind of a tool to get to a place.
If we can borrow money moves that the mixing with Bob money's cheap.
Well he's a wanna borrow so that we could make more money in another case you know in a different asset class for example everybody looked at it that way it was.
You know if it's -- -- Karbala -- -- yeah we all became very sophisticated investors and I we -- very sophisticated at all but are those days completely over where.
You know I think I can get -- -- higher return investing in one asset class so I don't pay off a debt because I'm borrowing that money so.
So cheaply and people just don't talk that way anymore and I wonder maybe people still lack that way and are afraid to say it because it's not kind of the -- thing now and he didn't think it's.
It's paying off debt which is fine -- -- that you.
People thought that -- some circumstances.
I think that people should.
And are rightly so getting smarter about how they're using debt and the extent of debt they're willing to take on.
You know that's why so many people are frustrated with those homeowners who they believe took on loans that they couldn't afford.
And you know we can argue about what that the lenders fault -- targeted subprime lending going on with -- the homeowners fall.
But the part that I do agree that it felt homeowner's responsibility.
To think about or -- borrower's responsibility is this.
You can go to a bank and say listen I want to purchase this 400000 dollar house in the bank might say yes you qualify for that week we will give you 40000 dollar loan.
However the bank doesn't know all of your individual circumstances the bank doesn't know for example if you.
You know plan to take off a year to have a baby right doesn't know if your husband wants to start a new businesses so you'll need money for that debate doesn't know what you think did.
Coming down -- sabbatical from my job front of certain amount of time you're talking a personal responsible absolutely if all of us really are called upon to be.
Fiscally prudent at the end of the day who's going to care more about how your circumstances then you are.
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