The Credit Crunch

Chances are you are trying to make the most of your credit score but "the faster you go the behinder you get". Not to mention that there are so many variables that even if it LOOKS like you have stellar credit your score does not reflect it. Think about this. What incentive does any credit bureau have by helping you improve your score? It seems there is always something keeping you back from breaking the 650-700 mark. In fact, your score goes down faster than you can ever rebuild it.

Case in point. One missed or late payment may drag your score down 15-25 points in an instant but those points may take 6-12 months to recoup. As you make your payments on time the next 12 months you may be allotted a few points every month until you've made up the instant 15-25 points you've lost. That is if all remains the same.

While there are so many factors in your credit score we can't measure because we don't have the formulas, there's no sure fire guarantee that losing that 15-25 points won't occur again for another reason, say, you borrow up to the limit of your credit card and boom you are back 15-25 points again.

Monitoring your own credit is a daunting task but necessary if you are looking for any type of credit in the future. Where a score of 650 and above seemed sure of approval, credit has been tightening so securely in the banking industry that it's not enough to have less than 700. Life is not completely over under 700 but it sure is more difficult. Much higher interest rates must be swallowed and more hoops in the application process must be navigated.

In the next few posts I'll discuss some ways to build your credit score. Keep in mind, its like keeping all the balls in the air. If you just drop one you have to kind of start over.