Hi guys. It’s that time of year for me again. It’s time for all of us, actually, to check our credit reports. In a dumpy economy, our credit scores are more important than ever. Remember, I always get a free credit report every four months. A free one is allowed every year by the top three credit bureaus, so if you plan it right, you can get one free every four months.

Here are things to focus on this quarter. Keep your average credit limit for your major credit cards, such as Discover, American Express, VISA, or MasterCard, high. This tells lenders that you have enough financial experience, and they will be more likely to see you as a good credit risk. The trend for banks nowadays is to continue to cut your available credit whenever possible. Don’t allow this. Call and argue your way to the top. More often then not, they will keep you at your current limit to keep you as a customer.

Contrary to what many say, you have to have at least two or more open major credit cards, such as Discover, American Express, VISA, or MasterCard, on your credit report. This shows lenders that you are a responsible borrower and they may be more likely to see you as a good credit risk and extend you credit. But keep in mind, that these better be in good standing.

Most importantly these days, make sure your credit file shows no record of any current delinquencies on real estate accounts, such as a mortgage. Having real estate accounts in good standing is viewed positively by lenders.

In addition, make sure your credit report does not contain negative public records, such as a bankruptcy, lien, lawsuit or judgment filed within the last two years. This will have a positive impact on your credit score. Public record items may remain on your credit report for 7 to 15 years, depending on the item.

If you have any questions after reviewing your credit report this quarter, feel free to drop me a comment. I am, by no means, and attorney or qualified to give legal advice, but I am always open to giving my opinion.

Stay tuned and see you in seven! Happy savings!

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So it finally happened. Someone out there stole my credit card number and bought a bunch of phone card charges with it. Funny thing is, I never lost my card. It was still in my wallet!

So people, beware of identity theft: protect yourself. Now more than ever in this economy. My deduction is that when I gave the waiter at a restaurant my card to pay for the meal, the number was swiped. I did some research and found out that international phone cards do not need more than a credit card number to re-charge. The culprit then takes these fresh cards and sells them for less than face value. Viola! Instant 100% profit for the scumbag.

As you may have already seen, in the recent months, there have been different scams and frauds in the news, as well as some credit and debit cards being compromised from a certain processor.

I would like to share a few effective ways on how you can keep your accounts safe:

- Check your account statements for fraudulent activity every month. If you see any suspicious charges, notify your financial institution immediately.

- Sign up for Online Banking to keep track of your transactions in real-time.

- Do not call unknown phone numbers or visit suspicious web addresses.

- Do not give out account numbers or other personal financial information, unless you initiate contact.

- Shred personal and financial information before recycling.

- Ignore any correspondence with urgent requests for personal financial information. Many scammers will include upsetting or exciting messages to get people to react immediately.

- Review your credit report annually (or tri-annually, like I taught you). Visit Annual Credit Report dot Com.

- Use cash for smaller transactions.

Luckily, I called my bank in time and reported the incident. All is safe. See you in seven-ish!

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This is something I saw on the Boston Globe website this morning, and I had to share it with you guys. I am also using it as an example of why it is important to carefully scrutinize your staements as well as your credit reports. I have reprinted the article in full below for your convenience. Enjoy!

Several Internet complaint boards are filled with comments from credit card customers from coast to coast who have noticed a mysterious charge for about 25 cents on their statements.

Take a look at your credit card statements, and if the charge is there, don’t let it slide. It’s what the thieves want you to do. Instead, file a dispute with your credit card company, and lodge complaints with the Federal Trade Commission and the Internet Crime Complaint Center, which is run by the FBI, the National White Collar Crime Center, and the Bureau of Justice Assistance. Federal law enforcement officials tend to react when the complaints reach a certain volume.

If you are one of the millions hit with this scam, don’t let it slide! As the article stated, if you let this one slide, you’re just giving the crook the okay to proceed with a larger charge. Call your bank and put in a dispute and maybe sign up for fraud alert.

Okay, till next time guys, be smart, invest smart, and save smart.

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A few posts ago, we went over what a credit score is. Now I want to go over with you methods of protecting your credit score. Just because five is a nice simple number, that’s how many tips I will share with you today.

However, before we delve into the tips, I’d like you readers to be aware of the top causes of identity theft in the United States. According to TransUnion’s Fraud Victim Assistance Department, ways your sensitive information can be obtained include:

Theft by your employer; Credit card skimming; Mail theft; Misrepresentation often via phone or email; Lost or stolen purse or wallet; Improper disposal of credit card receipts and statements; Database intrusion; A dishonest employee; Domestic and/or elder abuse; or just plain eavesdropping and/or wandering eyes.

Pretty scary, isn’t it? Not knowing who you can and cannot trust. I always say, it’s always better to be safe than sorry. Anyways, without further adieu, the number one way to protect your credit score:

Be careful who has access to your Social Security number!
This is the main piece of information targeted by identity theft criminals, because unfortunately it is the only number companies use to identify you that is still somewhat private. A good rule of thumb is: only provide your Social Security number to trusted individuals or companies with which you initiated contact. Never, ever provide your Social Security number to anyone over the telephone, mail or email.

If you are applying for a loan, ask that your Social Security number be truncated or blocked out on any paper applications. Furthermore, pay close attention to the lender’s use of your credit report. Ask them to shred the copy once they have reviewed it.

And never, under any circumstances, ever print your Social Security number on your checks.

Shred old paperwork!
Old bank statements and mail that contain personal or financial information should be shredded prior to disposing. This may be a bit extreme but I like to separated the shredded pieces into different garbage cans. Many identity thieves dig through trash cans, in search of personal information. My way, crooks will have a more difficult time piecing papers together.

Secure your Computer!
With the ease of online banking and purchasing these days, the computer has become the new trash can for identity thieves. Run a virus scan on a regular basis. Intrusive programs can search your computer for sensitive information and send it to crooks through the internet. Use hard-to-guess passwords, and change them frequently.

Check your online accounts and credit statements often. Watch for unfamiliar charges or withdrawals, no matter how small the amount.

Subscribe to a Credit Monitoring Service!
Normally I would not support the use of services such as these, especially when we ourselves can monitor our own credit with ease. However, in our current fast paced world, it’s one less thing to have to worry about when a company can notify you each time someone applies for credit in your name. To get most bang for your buck, make sure that the company reports in real time. Some companies report only weekly, or once a month, which does not allow you sufficient time to deter possible identity theft. Get Equifax Score Watch Now!

Fraudulent Emails!
Another tactic thieves use in an attempt to steal your personal information is through “phishing”. These emails appear to come from legitimate businesses, particularly banks and other financial institutions, and are often difficult to discern from the real ones. Recently, I have come across emails including links that direct you back to the legitimate business websites, such as Bank of America and Paypal, to gain your trust.

If you click on the link in the email, you will be taken to a website that looks legitimate, but that is where they get you. Here, you will be asked to login, and BAM! That’s when all your sensitive information such as your account numbers, user IDs and passwords, etc., get automatically sent to the thief.

When you receive an email communication from a “phisher,” just delete it and mark it as spam. Don’t bother replying and chastising the crook. You will just be wasting your time.

Well, that’s it for this time folks. Be sure to tune in again for more ways to protect or raise your credit score. Either that or just come back and read my miscellaneous ramblings. I promise that every post will include at least one money making tip!

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According to Experian’s National Score Index, the average American credit score was 678, back in April of 2008.  Out of a possible 850, that doesn’t sound too bad right? You pay your bills on time, and try not to have too much debt. You should be well in the range of 650-680.

Sorry to burst your bubble guys, but nowadays, having a 680 score doesn’t mean too much! You will still get financed, but you would be required to put down a large down payment, and/or get charged a higher interest rate. And if your score is below 620, then you might even have a tougher time getting a loan.

So, what, exactly, is “good’ credit?” I went online to check my score and found this info:

- 720-850 – Excellent – This represents the best score range and best financing terms.
- 700-719 – Very Good – Qualifies a person for favorable financing.
- 675-699 – Average – A score in this range will usually qualify for most loans.
- 620-674 – Subprime – May still qualify, but will pay higher interest.
- 560-619 – Risky – Will have trouble obtaining a loan.
- 500-559 – Very Risky – Need to work on improving your rating.

Having recently spoken to a lender with a prospective client here in California, to qualify for the best rates, a person’s credit score had to be at least 720 and put down 15-20% of the loan amount. Crazy right? This just goes to prove my belief that the “system” is meant to keep the poor poor and the rich rich.

Never fear folks, I will disclose some tips for you to up your credit score, and reach that 720 in no time. The down payment, however, we will save for another time.

The first important tip is regarding your credit cards and the available credit limit. Having a large available credit on a credit card, is not always the best. The credit bureaus will still consider that the “potential” amount you can owe.  So, my tip to you is to refuse the periodical credit increases to your credit cards that companies will offer to you. You will “have” less to spend, and therefore spend less, and your credit score will not be bogged down by these, “potential debts.”

My second tip is a fairly obvious one, but many people tend to overlook it. Balance your checkbook regularly to prevent checks from bouncing. Too many bounced checks can have a negative impact on your credit report. It also keeps you aware of your financial situation and allows you to avoid potential pitfalls.

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