Insurance Companies Misuse Credit Scores to Set Prices on Car Insurance

Insurance Companies Misuse Credit Scores to Set Prices on Car Insurance Consumer Reports magazine September edition has a special report on how insurance companies use (really misuse) credit scores in determining how much to charge you for your car insurance. Each insurer cherry-picks about 30 of almost 130 elements in a credit report to come up with its own proprietary score. That score will be quite different than your FICO score. Customers with low credit scores are made to pay a lot more than customers with better scores. For example, a single driver in Kansas who incurred one moving violation...

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Does Too Much Credit Hurt Your Credit Score?

Does Too Much Credit Hurt Your Credit Score? Does having too much credit hurt your credit score? Should you close credit cards to reduce your credit available? These are questions addressed by Barry Paperno a contributor to creditcards.com. Conventional wisdom 20 years ago was that if a borrower had access to too much credit, he or she would be tempted to use too much credit and get in trouble. But in the 1980s, FICO did a study and found that there was no evidence that having “too much” credit would change the consumer’s behavior. The same research confirmed that open...

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The Impact of Foreclosures & the Rescission on Consumers’ Credit Records

The Impact of Foreclosures & the Rescission on Consumers’ Credit Records As everyone knows, foreclosures and accompanied recession caused tremendous economic damage affecting millions of consumers. These events have adversely affected the credit standing of millions of our citizens. The National Consumer Law Center has published an excellent report describing the problem and what should be done to mitigate the problems. Consumers who lost their homes due to foreclosure inevitably end up with a report of a foreclosure on their credit reports. These reports knock their credit scores down by 100 to 150 points. Even when a homeowner avoided foreclosure...

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Really Free Credit Scores from FICO & Credit Card Companies

Really Free Credit Scores from FICO & Credit Card Companies Fred Williams, writing in the CreditCards.com blog, reports that FICO, the owner of the most-used credit score, has a new free score program that allows lenders who already buy the score to share the score with consumers at no extra cost. Barclaycard and First Bankcard have announced plans to provide the free credit scores, and other card card companies will do the same in the near future according to FICO. FICO expects millions of consumers will have access to their scores by the end of this year by logging into...

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How to Remove Unauthorized Inquires from Your Credit Report

How to Remove Unauthorized Inquires from Your Credit Report As a consumer, you have a right to ask the credit reporting agencies to delete unauthorized inquiries. Inquiries may have a negative effect on your credit score especially if there a lot of them. An unrecognized inquiry may also indicate your a victim of identity theft. CreditCards.com has published an article that explains the details. In reviewing your inquiries on your credit report, you should first determine if the inquiry is a result of a prescreened inquiry. Lenders are allowed to view your credit report without your permission so long as...

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