OvationLaw's Blog

As a consumer you've learned the importance of establishing a good credit rating with your lenders. Whether you are shopping for a new home or auto, or searching for the best deals on insurance, your credit worthiness will be judged by your credit rating or credit score.

A bad credit history or bad credit habits will place "black marks" on your credit profile. These include things such as late payments, having an account assigned to a collection agency, and of course bankruptcy.

Establishing good credit habits and therefore a good credit rating will improve your credit worthiness. This will be reflected in potential lenders offering you substantially lower interest rates and better deals on credit offers.

Here are 4 tips to help you create a shining credit profile:

1) Pay Your Bills On Time
Lenders only have your past payment history on which to decide the type of credit risk you present to them. How you pay off your debts now indicates to them how you will pay off future debts.

2) Don't Carry Too Many or Too Few Credit Cards
How much is too much? How little is too little? Many credit experts and financial planners suggest two to four credit cards is just the right mix.

3) Pay At Least the Minimum Due
Always pay at least the minimum due payment, but never less. And remember, just paying the minimum payment means it will take you years and years to pay off that credit card.
Example: Paying off a $2,000 credit payment at 18% APR with a minimum monthly payment of 2% ($40 dollars or less) will take you 30 years to pay off the amount plus interest.

4) Review Your Credit Report Regularly
Monitor your credit report from all three major credit bureaus - Experian, TransUnion, and Equifax - on a regular basis. Check your credit profile at least annually. Review it carefully and make sure that any past mistakes or disputes have been corrected.

Also, if you notice an account listed that you know that you have not personally opened, contact that creditor and the credit bureaus immediately. This could be a sign that you've had your identity stolen. Request to have a fraud alert placed on your profile and account to protect yourself and your credit. Identity theft is the fastest growing consumer crime in America, with an estimated 1 million people victimized each year.

Establish good credit habits early in life and reap the benefits that your good credit rating will provide you for the rest of your financial future.

A credit inquiry is an item on a credit report that shows a business with a "permissible purpose" (as defined under the federal Fair Credit Reporting Act) has previously requested a copy of the report.

When you check your credit report, you may notice that a number of credit inquiries have been made, sometimes from businesses that you don’t know. But the only inquiries that count toward your FICO score are the ones that result from your applications for new credit.

There is only one type of credit inquiry that counts toward your FICO score. When you apply for a mortgage, auto loan or other credit, you authorize the lender to request a copy of your credit report. These types of inquiries, prompted by your own actions, appear on your credit report and are included in your FICO score.

Your own credit report requests, credit checks made by businesses to offer you goods or services, or inquiries made by businesses with whom you already have a credit account do not count toward your FICO score. Credit checks by prospective employers also do not count. These types of inquiries may appear on your credit report, but they are not included in your FICO score.

Checking your credit reports regularly to be sure they are accurate and error-free is a good idea. In fact, maintaining accurate credit reports is a part of good credit management, which can help to improve your FICO scores over time.

How inquiries are factored into FICO scores.
There are five types of information used to calculate a FICO score at any given point in time. Each type of information counts as a percentage of a total FICO score:

Payment history = 35%
Amounts owed = 30%
Length of credit history = 15%
New credit = 10%
Types of credit in use = 10%

These percentages are based on the importance of the five categories for the general population. For particular groups, such as people with relatively short credit histories, the importance of the categories may differ.
Inquiries are a subset of the "new credit" category shown above, which accounts for 10% of the total FICO score. Their importance depends on the overall information in your credit report. For some people, a given factor may be more important than for someone else with a different credit history. In addition, as the information in your credit report changes, so does the importance of any factor in determining your score. What's important is the mix of information, which varies from person to person, and for any one person over time.

Inquiries may or may not affect your FICO score.
A FICO score takes into account only voluntary inquiries that result from your application for credit. The information about inquiries that can be factored into your FICO score includes:

• Number of recently opened accounts, and proportion of accounts that are recently opened, by type of account.
• Number of recent credit inquiries.
• Time since recent account opening(s), by type of account.
• Time since credit inquiry(ies).

A FICO score does not take into account any involuntary inquiries made by businesses with whom you did not apply for credit, inquiries from employers, or your own requests to see your credit report.

For many people, one additional credit inquiry (voluntary and initiated by an application for credit) may not affect their FICO score at all. For others, one additional inquiry would take less than 5 points off their FICO score.

Inquiries can have a greater impact, however, if you have few accounts or a short credit history. Large numbers of inquiries also mean greater risk: People with six inquiries or more on their credit reports are eight times more likely to declare bankruptcy than people with no inquiries on their reports.

FICO is registered trademark for Fair Isaac and Company, or Fair Isaac for short. Fair Isaac is a company who constructs 'credit score' tools for lenders who use them to evaluate the credit of their customers and prospects. FICO credit scores are among the most well known credit scores, but there are certainly other competitors of Fair Isaac who also construct credit scores. Additionally all three of the national credit bureaus may construct proprietary credit scores of their own - independent of Fair Isaac.

FICO credit scores have become well known to consumers over the last several years because they are often used in mortgage loan transactions. For example, a lender wishing to extend a home mortgage loan to a consumer, may order a FICO score on the consumer to try to predict whether the consumer is going to default on the mortgage loan at some date in the future. A FICO score ordered through a credit bureau is only based on elements in your credit report. With FICO scores, a higher score means you are less risky for the lender. As a result, a high FICO score may mean you qualify for a larger loan or perhaps a better interest rate.

FICO credit scores have traditionally only been available to lenders as a tool to evaluate your credit. However, FICO has also made their scores available to consumers.

It is important to note that your credit score is not part of your credit report, and in fact, it is separate from your credit report. Also, credit bureau scores cannot be purchased without the simultaneous purchase of your credit report.

Non-FICO credit scores available on the Internet to consumers are much the same as credit scores from Fair Isaac. They are all trying to compute a number that measures how risky you are as a loan prospect based solely on the elements of your credit report. Credit bureau scores do not use your income, net worth, race, religion, sex, marital status, or age to compute your score. Credit bureau scores are only based on what's in your credit report.

The three major credit bureaus maintain credit files on nearly 90 percent of adults in the United States. An alarming number of these credit reports (79%) contain errors and could cause the denial of credit, insurance, or even employment.

To maintain your financial well-being, it is vital to monitor the status of your credit report and remove any inaccuracies.  Check your credit status by requesting a copy of your credit report every 4-12 months.

However, instead of ordering a report from each bureau at one time, save money by requesting your report from one of the three major credit bureaus every 3-4 months. Though your credit information will vary slightly from one bureau to the other, this should still provide you with a general assessment of your credit status.

Information on the Three Major Credit Bureaus:

Equifax - www.equifax.com
To order your report, call: 800-685-1111 or write:
P.O. Box 740241, Atlanta, GA 30374-0241
To report fraud, call: 800-525-6285
And write: P.O. Box 740241, Atlanta, GA 30374-0241
Hearing impaired call 1-800-255-0056 and ask the operator to call the Auto Disclosure Line at 1-800-685-1111 to request a copy of your report.
Main Number: 404-885-8000

Experian (Formerly TRW) - www.experian.com
To order your report, call: 888-EXPERIAN (397-3742) or write:
P.O. Box 2002, Allen TX 75013
To report fraud, call: 888-EXPERIAN (397-3742) and write:
P.O. Box 9530, Allen TX 75013
TDD: 1-800-972-0322

Trans Union - www.transunion.com
To order your report, call: 800-888-4213 or write:
P.O. Box 1000, Chester, PA 19022
To report fraud, call: 800-680-7289 and write:
Fraud Victim Assistance Division, P.O. Box 6790, Fullerton, CA 92634
TDD: 1-877-553-7803
1-800-916-8800
1-800-680-7289

Social Security Administration (Fraud line): 1-800-269-0271

Rights under the Telemarketing Sales Rule
To learn about your rights under the Telemarketing Sales Rule and how to protect yourself from fraudulent telephone sales practices, request a free copy of Straight Talk About Telemarketing. Contact: Consumer Response Center, Federal Trade Commission, 600 Pennsylvania Avenue, NW, Washington, DC 20580; toll free, at 1-877-FTC-HELP (382-4357); TDD 1-866-653-4261.

The following organizations have additional information:
American Financial Services Association
Education Foundation
919 Eighteenth Street, NW
Washington, DC 20006
www.afsaef.org

National Association of Consumer Agency Administrators
1010 Vermont Avenue, NW, Suite 514
Washington, DC 20005

Navy Personnel Command
Personnel and Family Readiness (PERS-662C3)
5720 Integrity Drive, Building 768
Millington, TN 38055-6620

Clean your Report Today
Repairing your credit report is one of the most important financial decisions you can make. Ovation Law is a trusted law firm that makes the process convenient, personal, and effective. If you have any other questions or need for or credit report repair services, please contact us anytime:

  Phone: 1 (866) 639 - 3426
  Email: info@OvationLaw.com

Most email users are becoming more knowledgeable about ‘email etiquette’ and the basic email ‘do’s and don’ts’, but there are some helpful tips to heed that can enhance our Internet experience and protect us from many of harmful viruses, Internet scams, and unsolicited commercial email, known as spam.

No doubt your place of employment has established some general rules of email use in the work environment, but when it comes to using your personal email account, whether from your home or from remote locations, there are some simple rules to follow that will make your online experience more enjoyable and more productive.

Maintain More Than One Email Account
Establish two or three email accounts, and designate each account for specific purposes. (This will not only save you a great deal of time and stress, but it will help to protect your personal information.)

Designate one email account specifically for your online payments. This makes it easier for you to maintain the security of your electronic purchases by exposing only one card online and allows you to monitor all your Internet purchases by viewing one credit card statement. If you are exposed to an identity theft scam, you’ll be able to discover it quicker and minimize the damages.

Designate another account for your online subscriptions, downloads, newsgroups, and general use. You will most likely receive an abundance of unsolicited commercial email (spam) in this account but there are ways to keep spam under control – as outlined in the following section, and these two previous accounts will help you to avoid unwanted email from being delivered to your personal account.

Finally, designate one account as your personal email account, and be stingy with whom you share this address with. That way, when you want to quickly check your email, you won’t have to wade through piles of spam just to read an email from a family member. Do not publish this email anywhere on the web or use it with chat rooms and news groups.

The Scoop on Spam
Two of your three email accounts will undoubtedly be targeted for spam. (The technical term for spam is “unsolicited commercial email” (UCE) that is sent in bulk without prior request or consent.) These mass emails often carry messages involving pyramid schemes, adult products, frauds, and computer viruses.

While it was first termed "junk mail", today’s popular term of “spam” caught on with the public as a result of a TV skit on Monty Python where Vikings invaded a ‘dive restaurant’ and the word "spam" was used more and more frequently as the waitress spouted off each successive dish on the menu, similar to the way spam email seems to endlessly accumulate in your mailbox.

The first known spam email was sent on May 1st, 1978, by a DEC marketing representative to every Arpanet address on the west coast of the United States. The general public reaction was one of outrage, and it hasn't subsided since. The majority of email sent on the net is spam, and the sheer volume threatens to bury the legitimate, everyday email being sent.

It’s important to note however; that even though spam is frequently used by scam artists, not all spam is fraudulent.

Legitimate marketers as well as con-artists have found the ability to quickly and affordably reach huge numbers of consumers through email too tempting to pass up. For criminals who don’t need to worry about actually providing a physical product or service, only a tiny fraction of the thousands or millions of email recipients need respond in order for the spammers to make a lot of money. It’s a shot in the dark for these swindlers, but there are more than enough con-artists and fraudsters who are willing to pull the trigger.

Spammers obtain email addresses by purchasing lists from marketing brokers who have “harvested” the addresses from various sources including: websites, Internet chat rooms, newsgroup postings, and online membership directories. The address list is then dropped into special software and the message is sent to thousands, and even millions of consumers. Depending on the software used, the spammers can even see who opened the email and then place those addresses on a new marketing list, subjecting them to more spam.

FTC Enforcement Action
The FTC has taken several steps to control deceptive spam. In 1998, the Commission set up a special email account to monitor spam and track spammers. Today, that account receives about 40,000 pieces a day. Three years ago, the same mailbox received about 4,000 a day.

No More Spam!
You can enhance your security and greatly reduce, or even eliminate the amount of spam you receive by diligently implementing and following the procedures and guidelines provided here:

1. Never respond to an email that asks for personal information (i.e., phone number, address, account information etc.)

2. Don’t display your private email address in public spaces, including chat rooms and newsgroup postings, on websites, or in membership directories of online services. (The most effective way to prevent spam is to never divulge your email address to third parties.)
If you enter a chat room or a newsgroup, disguise your email with nonsense words or use a temporary address.

3. Never send money to anyone who contacts you by email for any reason whatsoever.

4. Avoid opening or previewing any unsolicited email. (If you preview a spam email and it has an image link you are validating your email address, inviting even more spam.)
As tempting or enticing as those subject lines may be, don’t take the bait. Many times the subject may even sound like the email is from a friend or other trusted source. Some of the nastiest computer viruses have been propagated by consumers who innocently opened an email – along with its’ attachment – that had the subject: “Here’s the file you wanted,” or “Here’s my picture,” etc.

5. Always check the source of the email before you open it, and NEVER open an email attachment unless you know what it is and where it came from.

6. Finally, don’t click on the ‘unsubscribe’ or ‘remove me’ link. A spam filtering firm (MessageLabs) recently discovered that some spammers are sneaking special code into the ‘opt-out’ link that, upon activation, uses the victim’s computer to route more spam through. So, in addition to validating your email by clicking on a spam ‘opt-out’ link, you may also be downloading a Trojan that turns your computer into an open proxy for sending more spam.

Other variations of the attack place keystroke loggers on victims' computers that enable the spammer to collect passwords and other personal information.

Stay informed of the latest Internet scams and hoaxes, and keep current on your virus protection software and security patches. The technology of the Internet is a tremendous achievement, but with every great technological accomplishment there comes a downside, and we need to be mindful of our vulnerabilities and take preventive action to fully enjoy the advantages that technology has to offer.

For more information on email and Internet safety, visit Ovation Law’s Educational Resource Center and download our e-book, Internet Safety Tips.

Contact Us
If you have any other questions or need for credit report repair services, please contact us anytime:
Phone: 1 (866) 639 - 3426
Email: info@OvationLaw.com