Having a good credit rating today has become an important part of surviving and thriving in our society. Learn how to keep your credit rating as high as possible by reading this article.
Having a good credit rating today has become an important part of surviving and thriving in our society. From filling up your car with fuel to buying groceries, and even to buying a new house and furnishings, credit cards can facilitate all of this and more.
Especially when it comes to getting a mortgage, your credit score is one of the most important aspects of judging whether you have competency in money management matters, and whether you can get a low interest rate.
Revolving Debt and Credit Score
Revolving debt is one of the most important aspects of your credit score, and in order to consistently keep your credit rating as high as possible it is wise to fully understand this concept.
Credit agencies and banks have nearly full access to all of your credit history of borrowing money, since all major financial institutions will regularly report to the major credit agencies. To think that something will not show up on your credit report just because it is spread out over multiple credit cards is naive and it is not the way this industry works.
Revolving debt is the percentage of your total amount of credit across all credit cards and loans, relative to the amount of money that you still need to pay back currently.
For example, if you have five credit cards and a combined credit limit of $30,000, if you never used these credit cards or had them all completely paid off then your percentage of revolving debt would be 0%. This is seen as a good sign to banks and credit agencies, especially if you have been able to charge a lot of money and then pay it off fully and on time.
But if however you rack up $25,000 dollars worth of charges and make only the minimum payments for a year, your percentage of revolving debt would be close to 85%. For most banks and credit companies, any ratio of revolving debt that is above 30% is a signal that you may not be a trustworthy borrower, especially if this percentage has stayed high for a very long time.
The best way to keep your credit score high is to only make charges on your credit cards that you know you have the money to pay off right away. This way your percentage of revolving debt will stay as low as possible, and this combined with making your credit card payments on time will ensure that your score stays as high as possible.
The Benefits of Getting a Fixed Rate Mortgage Instead of An Adjustable Rate Mortgage
This article will discuss whether a potential borrower should get a fixed rate mortgage or an adjustable rate mortgage. While both of these different models have their benefits and pitfalls, it really depends on the current economic climate as to which type of loan you should get.
Is An Adjustable Rate Mortgage a Good Choice For You and Your Family?
By accepting an adjustable interest rate for the term of your loan or mortgage, you are also taking on a degree of interest rate volatility risk, so you may receive additional benefits such as lower initial payments. Is this a good strategy for you and your family?
Impact of the American Recovery and Reinvestment Act on First-Time Home Buyers
The American Recovery and Reinvestment Act (ARRA) of 2009, signed into law by President Obama, was designed to stimulate the U.S. economy and has significant implications for first-time home buyers. This article explores how the ARRA provides opportunities for those entering the housing market, particularly through tax credits and funding for affordable housing projects.
