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Allstate increases premiums for Pennsylvania customersPosted On Mon, June 7, 2010
With so much attention focused on the three-digit number of a credit score, it’s important to remember just what makes up that score, and what affects it the most.
The biggest factor when determining a credit score is the consumer's ability to pay their bills on time, every time, according to a recent article in the Poughkeepsie Journal. It is vitally important that every bill is paid every month, because that alone makes up 35 percent of a consumer's credit score.
The article warns that even one mistake or late payment can wipe out months or even years of good credit.
The article also says that another 30 percent is based on outstanding debt. While lenders expect that consumers will carry some amount of debt on credit cards, it's important to not carry more than they can afford.
Further, another 15 percent is made up of past credit history. The article says that this is tough news for recent college graduates who are just coming into their financial independence, but it's just a fact of life that lenders are more likely to give money to those that have proven they can pay off their bills.
An article in the New Jersey News Record says that if there is information in a consumer's credit report that they feel is inaccurate or incomplete, credit agencies are required to correct it, and all it takes is a dispute letter. With this letter, the consumer should provide copies of the information being disputed and backup documentation. The credit agency is required to respond within 30 days.
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