Viewing, Understanding and Fixing Your Credit Score/Rating (So You Can Get a Loan)

Chris Haroun
A free video tutorial from Chris Haroun
Award Winning MBA Professor, Venture Capitalist and Author.
4.5 instructor rating • 54 courses • 1,029,738 students

Learn more from the full course

The Complete Personal Finance Course: Save,Protect,Make More

3 Courses in 1! Save,Protect & Make More! By an Award Winning MBA Professor, VC & Best Selling Online Business Teacher.

15:46:12 of on-demand video • Updated April 2021

  • Upon completion of this course, students will be able to save, protect and make much more so that their net worth is significantly higher in the long run. You will be a personal finance expert by the end of this course!
  • How to profit from the INCREDIBLE Power of Compound Interest
  • 100+ Ways to Save More…Including the following ways:
  • 14 Ways to Save More on Taxes
  • 16 Ways to Save More on Shopping Expenses
  • 13 Ways to Save More on Car/Transportation Expenses
  • 10 Ways to Save More on Housing Expenses
  • 5 Ways to Save More on Vacation Expenses
  • 4 Ways to Save More on Gifts & Donation Expenses
  • 6 Ways to Save More on Phone/Computer Expenses
  • 13 Ways to Save More on Food & Drinks Expenses
  • 7 Ways to Save More on Debt Expenses
  • 4 Ways to Save More on Education Expenses
  • 7 Ways to Save More on Entertainment Expenses
  • 6 Ways to Save More on Fees Expenses
  • 5 Ways to Save More on Child/Child Care Expenses
  • 4 Ways to Save More on Health Expenses
  • 5 Ways to Save More on Personal Care Expenses
  • 5 Ways to Save More on Pet Related Expenses
  • How to Change Your Perception of Money
  • How to Teach Your Children About Saving
  • How to Protect Your Money by Understanding Your Net Worth (Creating and Understanding Your Balance Sheet….Meaning “What You Own and What You Owe”)
  • Understand if You Should Hire a Financial Advisor to Help Protect Your Money
  • Understand Why Hiring an Accountant Might be the Best Investment You Might Ever Make
  • How Taxes + Retirement Accounts Work & Why We Need to Minimize How Much Tax We Pay
  • How Much You Need to Retire
  • Understand and Taking Advantage of Tax Incentives, which Help You Save BIG TIME for Education/School Expenses
  • How Much You Need for Education Expenses (for You or Your Kids)
  • How to Create Your NEW & IMPROVED Income Statement (Meaning Understanding Money In and Money Out)
  • Understand Your Company Sponsored Tax Savings Plans (if Applicable)
  • Use a Simple & Effective Money, Taxes, Receipts and Statements Filing System
  • Understand What are the Best Websites & Apps to Help You Track and Manage Your Spending
  • Use Quicken on a PC to Manage Your Money
  • Use Quicken on a Mac to Manage Your Money
  • Protect Your Money by Making a Monthly Budget
  • Avoid Getting Ripped off on Fees
  • Understanding Wills and Trusts
  • View, Understand and Fix Your Credit Score/Rating (So You Can Get a Loan or Mortgage)
  • Understand Life Insurance
  • Understand Auto Insurance
  • How to Pay Less Tax Strategies
  • Understand Home and Property Insurance
  • Understand Health Insurance
  • Prevent Identity Theft
  • Understand Credit Cards
  • Understand Loans
  • Understand Leases
  • What Are the Qualities of Billionaires (5 Characteristics of Billionaires I Have Worked For)
  • Understand the Damage that High Investment Fees Can do to Our Net Worth!
  • Make More by Learning How to Avoid Paying High Investment Fees
  • Understand Why and How to Pick Investments from Index Funds
  • Manage Your Investments with Your Investment Portfolio Management System (Included in the Course)
  • Populate Your Investment Portfolio Management System (meaning Your Portfolio)
  • How to Invest in Stocks and 4 CRUCIAL Stock Investing Rules
  • Investment Data Basics
  • Understand Risk Management
  • Understand What Makes Stocks, Bonds, Commodities and Real Estate Investments Go Up or Down
  • How to Do Your Own Investment Research (and Never Rely on the “Pros”)
  • Understand Mutual Funds
  • Know What Warren Buffett’s Favorite Types of Investments Are
  • Understand Interest Rates, Bonds and “The Bigger Picture”
  • Know How Global Economics Works and Why this Matters to Personal Investors
  • How & Why Do Interest Rates Change & Why this is Important for Investors to Understand?
  • Understand Foreign Exchange Currency Movements
  • How Bonds Work and How Can Governments Stimulate the Economy?
  • Understand Real Bonds - No Theory! (With Real Corporate and International Government Bond Investment Examples)
  • How to Invest in Bonds
  • Add Bond Investments to Your Portfolio
  • How to Invest in Commodities
  • Add Commodity Investments to Your Portfolio
  • Introduction to Your Most Important Personal Investment & How Much Should to Spend on a House
  • How Mortgages Work & How to Calculate Payments (Fixed Rates Versus Interest Only Rates & More)
  • How to Calculate Mortgage Payments and Know What Happens When Rates Change
  • What You Need to Know if Considering Investment Properties
  • How Much to Spend on an Investment Property
  • Understanding Real Estate Investment Trusts
  • Adding Real Estate Investment Trust Investments to Your Portfolio
  • Investment Types to Consider Avoiding Given Liquidity Risks
  • Diversification Strategies and Your Diversified “Model Portfolio”
  • Should You Start Your Own Business & Have >1 Income Stream? 100% YES!
  • Customize Your Own Complete Personal Finance Excel Dashboard (I Will Teach You How to Customize and Create Your Own Version of the Excel Dashboard Document Used for ALL 25 Exercises in this Course)
English -: Your ability to buy a house or pay for your kid's education is based partially on how good your credit rating is. Now, every bill that you pay today has an impact on if you can buy a house in the future or if you can get a loan for your kid's education et cetera. K, and examples of companies that determine what your credit rating is, at least in the US, are what we refer to as the big three. Okay and the big three are Equifax, Transunion, and Experian, and there's others as well. K, and for credit ratings in your country, if you're not in the US, you can go to the settings page and near the bottom here you can click on the credit agencies internet link for your country, K? And if you can't find your country's consumer credit rating agency then please call your bank and ask them if one exists so you can learn how to improve your credit rating, K? And usually it's not just one, it's more than one, talk to your bank, K. Also, per this video here, you can search Google for credit rating agencies in the US or your country, K, and then you can either access your credit reports for free, or pay a fee to access them. K, and it's actually a worthwhile investment cause you can understand what the issues are with your credit report and how you could improve your credit rating, so you can get a loan if needed in the future. K, you can always call these credit companies and ask for help on how to access and improve your credit rating, okay. And different countries have different names for your credit score. In the US, people refer to your credit score as a FICO score. F-I-C-O which stands for Fair Issac Corporation Score. It's FICO score's range from the lowest or worst score of 350 to the highest or best score of 850. And if your FICO score is below 580 then FICO thinks that there's a high probability that you will default or not be able to pay back your loans. If your FICO score is between 580 and 669 then you have okay credit but not high enough for new lenders to keep interest rates low for you. Now if your FICO score is at 670 or above, then your chances of getting a loan or a mortgage is much, much higher, K. Now your FICO or credit score in most countries is broken down as follows, they're all similar, K. 35 percent of your score, your credit score, is based on your payment history, k, meaning you pay back your bills on time. 30 percent is based on how much money you owe right now. And 15 percent is based on the length of your credit history, longer of course is better. And 10 percent is based on recent or newly open credit accounts, K like credit cards. And the last 10 percent is based on the type of credit that you use. K and so you could actually improve your credit rating by doing the following five things. Number one, pay all your bills before they are due, not just on credit cards but also on your mortgage, car payments, other loans, et cetera. The second way to improve your credit rating is to make sure that you have no unpaid bills that are past due. K and the credit rating agency might be able to tell you what those unpaid bills are. And you can actually, you can improve your bills or your credit rating I should say by actually going and paying off those bills immediately. And I'll give you a personal example in a minute. Number three, the third way to improve your credit score is to cut the amount of debt you have. Four, make sure your credit card balances are low. And five, ensure that the percent of your credit on each account is low. The percent of your credit in each account is low. For example, it's better to have an unpaid credit card balance of 500 dollars when your credit card limit is 5000 dollars, which is ten percent. It's better doing that than having a credit card balance of 400 dollars when your credit card limit is 800 dollars, which is 50 percent. K and so call your credit card companies or company now and just ask them to increase your credit limit, as this will help your credit score a lot, all you have to do is ask, K. Now, hold on one second, I'm just gonna grab something here. Okay. I'm gonna cover up the (mumbling) Okay so this here is a credit card that I had for, well I still have it but it's not in use anymore, for a company called Nordstrom, which is a cool place where you can buy clothes from the States I like, alright. And so a few years ago I actually bought a house and my mortgage loan did not get approved because of my credit rating and I was really confused because we pay our bills on time and Christine is amazing and much better than I am about this, my wife, so what I did was I called the credit agency and they said that my credit rating was not good enough because I had not paid a very small bill on my retail credit card from a retail store called Nordstrom. K, and what happened was, I remember I bought some clothes and they said hey if you open up this credit account, you can save 10 percent, and I was like hell yeah. I opened it and then anyway, don't do that. And so what happened was Nordstrom actually sent the bill to the wrong address, and quite often these credit card companies are wrong. Nobody cares more about your own personal finances than you. K, and so what I had to do was I had to walk to the closest Nordstrom store in San Francisco and I begged them, I begged them to help me with the issue and eventually they did. K, and if they don't help you, then ask to speak to the manager, okay. And had I not done this I would not have been able to buy a house. Crazy, eh? Okay, so, I'm not upset at Nordstrom anymore. K so please make sure that you pay your bills early and call the credit rating agency in your country or your bank if applicable and ask them to show you on your credit report how you can improve it, how can you improve your credit rating if applicable. And if there's a credit breech, meaning if a computer hacker hacks into the credit website, which happened recently in the United States, then you can even consider calling the credit company or credit companies like Equifax, Transunion and Experian, the big three, and have them all freeze your account temporarily. Which means that no bank or mortgage company or lender can call and get your credit report. K, but before you do this though please make sure, before your freeze your accounts, to ask the credit company if freezing your account will affect your credit at all. K, if it doesn't, then it's cool to freeze it. And if you think that you're a victim of identity theft, then call your credit agency and have them freeze your credit report, with your permission of course, so that nobody can take a loan out in your name until you unfreeze your credit account, okay, and this is only gonna get worse in the future unfortunately, which is why I'm so paranoid about you having this excel file for this course just on your PC or Mac and not up in the cloud, okay. We'll talk about identity theft very soon in this lecture here, K. Most people don't ask for their credit score annually, which is unfortunate. You can access this free online in many countries and just please do a Google search in the US and you can get your free credit report at this address. And just make sure that you're not getting scammed by an unethical website. And how can you make sure of this? Well make sure that a government website or government official tells you what the correct website is to get your free credit report. For example, if you click on this link here, then per this image here, you will see what the correct government agency is for credit reports, K. And here are some safe sites in the United States at least for accessing your credit. Creditkarma.com, remember we talked about the app Credit Karma before, so creditkarma.com is one. You got creditsesame.com, credit.com, Quizzle, I think that's how you pronounce it, quizzle.com, et cetera. And for international sources just please ensure that the websites you use are government approved as we don't want to share our private information of course with the wrong sources. And if you're interested, here's a link to some international credit rating companies here. Now, let's talk about how you can improve your credit score if you're younger or if you have never had any credit, right, as we all have to start somewhere. Here's what you do, K, so you can establish credit. Number one, ask your bank for a credit card. K, number two, make sure your utility bills, and your electricity bill or water bill, et cetera, make sure your utility bills are in your name and you pay them on time. Number three, go to a gas station and get a credit card there. K, just get started, K. And once you get more credit cards then cancel the gas one or the retail store one like Nordstrom. Number four, make sure you have a bank account. Okay, and so if you wanna get your credit report in the United States you can call these three companies at the following phone numbers here, K, or just go to their websites which I've listed here as well. K, and these credit companies make mistakes all the time, and so please double check that your credit score is accurate. And no one's ever gonna care about the accuracy on any money or credit related report about you as much as you will of course. Okay and so remember DTA: Don't Trust Anybody. Not because somebody might be, not just because somebody might be trying to scam you but because money and credit companies make mistakes all the time.