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What’s a good credit score? Myths about credit

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When you’re applying for credit, whether it’s a mortgage, a personal loan or a credit card, your lender will almost always look at your credit score. But what exactly does your credit score mean, and what’s a good credit score versus a bad one?

Before we get into good credit scores versus bad scores, it’s important to understand what a credit score actually is. Basically, a credit score is your entire credit report boiled down into one easy-to-reference three-digit number. It includes almost everything on your report, such as the number of open accounts, the types of accounts, your payment history, how often you’ve tried to get new credit and so on.

Credit scores typically range from 300 to 850, but not always, and that brings up an important point — not all credit scores are the same. There are many different ways to translate the information on your credit report into a simple three-digit number, so there are many different credit scoring models, which are the algorithms that decide how to calculate that one number.

The most well-known and widely used credit scoring system is called FICO, named after Fair, Isaac and Company, which invented it. A second competing system known as VantageScore is also sometimes used by lenders and other companies analyzing your credit.

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While both systems use a range of 300 to 850, they differ on what constitutes a good credit score. So when determining whether your credit score is good or bad, it’s important to know which credit scoring model your score comes from.

With all that in mind, here’s how a typical FICO credit score breaks down:

  • Excellent: 800 and higher
  • Very good: 740 to 799
  • Good: 670 to 739
  • Fair: 580 to 669
  • Poor: 579 and lower

The tiers of a VantageScore credit score are slightly different and look like this:

  • Excellent: 781 and higher
  • Good: 661 to 780
  • Fair: 601 to 660
  • Poor: 500 to 600
  • Very poor: 499 and lower

As you can see, there’s a lot of variation between the two competing systems. A FICO credit score of 600 would be rated as “fair,” but a VantageScore of 600 falls into the “poor” category. On the other hand, a VantageScore credit score of 785 would be considered “excellent,” while the same score would be deemed just “very good” in the FICO system.

And even within these two broad credit scoring systems, there are dozens of different models that focus on various aspects of your credit, and you’ll get a different credit score from each model. Some models can even have a scoring system that varies from the typical 300 to 850 range.

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However, the most important factor is what your lender considers to be a good credit score. Lenders can internally use a variation on the above tiers, and while one bank may offer its best interest rates to people with a FICO credit score of 720 and above, another lender might only provide those top rates to folks with credit scores higher than 740. Plus, a lender will also take other factors into account beyond your credit score, such as your income and existing monthly debt payments.

Your credit score is just one piece of information that a lender will use when determining whether to offer you credit, and at what rate.

Your credit score is just one piece of information that a lender will use when determining whether to offer you credit, and at what rate.

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In the end, don’t panic too much about whether your credit score falls into the “very good” or “good” bracket. The key is knowing roughly where you stand, then working to improve your score. Your credit score changes every time there’s a change to your credit report, so using your current credit responsibly can drive your score higher in a relatively short amount of time.

And before you start applying for credit anywhere, it’s vital to know your credit score. If it’s lower than you think it should be, you’ll want to take a close look at your credit report to see if any of the information on it is incorrect. It’s not uncommon for credit reports to have the wrong data, and with so many data breaches in recent years, it’s also possible for fraudulent accounts to appear on your report if your sensitive personal information has fallen into the wrong hands.

So, if you’re considering opening a new credit card or refinancing your mortgage, take a moment to check your credit score and get an idea if you have good credit or bad credit.

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Read other stories in our “Myths about credit” series:

Looking for a new credit card? Read CNN Underscored’s guide to the best credit cards of 2020.

Get all the latest personal finance deals, news and advice at CNN Underscored Money.

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Can E Transfer Payday Loans Help Me Out of My Financial Slump?

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Whether we like it or not, there are going to be times in everybody’s lives when they need access to quick money, and for some folks, it is not going to be as easy to get their hands on that money as it will be for others. Unfortunately, the lending and credit industries are very much predicated on having a great credit score for them to work with you. 

If you’re facing some unexpected situation in life and need to get your hands on cash fast, but don’t have the very best credit score, don’t panic. Believe it or not, there are great options available to you that you can take advantage of with some research, no matter what kind of credit score you might have. 

What is being referred to here? E transfer payday loans are becoming a great way for people to gain access to low income e transfer payday loans , right when you need it. All it takes is finding the right lender for you and knowing just how much money you need. 

How Does it Work?

If you’d like to check out what these e-transfer payday loans could do for you, it is not going to be difficult for you to get started. You see, there are hundreds, if not thousands, of payday lending websites ready to serve people looking to get started with a loan of their own. 

You will need to make sure you have some important information and paperwork together, including: 

  • Your government issued ID so you can easily verify your identity with the lender. 
  • Your banking information so your payday loan can be sent to you quickly if approved. 
  • Your income information so your lender will be able to make an accurate loan decision based on your income, and not your credit. 

When you have all of this information together and ready to go, you will need to start looking up payday lending websites to find the best one for you. You should thoroughly read any information presented on the lender’s website, and make sure you are familiar with their policies, percentage rates, and any other fees before you apply for a loan with the lender. 

If you think you are in agreement with all of the information presented on the lender’s site, all you will need to do is fill out the loan form telling the lender how much you would like to borrow, and then sit back and wait for your loan decision to show up in your e-mail. 

How Long Does it Take?

Loan decisions on e-transfer payday loans typically don’t take very long at all to show up in your inbox. You can usually expect to have your loan decision from your chosen lender in anywhere from a few minutes to a few hours, depending on what time you apply for your loan. 

If your payday loan is approved, it shouldn’t take more than one business day for your money to show up in your bank account. Once it’s there, you’re free to spend it however you’d like. Just make sure you thoroughly go over your loan agreement with a fine-tooth comb so you know when the expected repayment date is so you can be sure to pay the whole loan off on time. 

Who Are These Loans Meant For?

Truthfully, these types of loans are meant for anyone who needs quick money now, though they will usually be used more often by folks with bad credit or even no credit. While folks with good credit can easily gain access to local lenders and establish lines of credit, these things are not as simple for folks with bad credit, who local lenders and banks usually won’t work with. 

E-transfer payday loans, on the other hand, allow anyone to have a shot at getting their hands on the money they need, no matter what their credit score may or may not be. The most important part in getting one of these kinds of loans is simply making sure you are able to fully pay it off by the due date, because some payday loans can actually affect your credit score if the lender reports to credit bureaus. Pay it off in a timely fashion, and it may even give your credit score a boost!

A Good Option For You?

If you are someone who deals with bad credit or no credit at all, don’t let that deter you from applying for the loan you want when you need money quickly. With enough research and some looking around, you will be able to find an e-transfer payday lender that’s right for you.


The views and opinions expressed in this article are those of the author(s) and do not necessarily reflect those of BK Reader.

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Ask the Fool: All about stock multiples

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A: It’s a ratio of two measures of a company. One of the most common multiples is the price-to-earnings (P/E) ratio, which is the stock’s current price divided by its earnings per share. Imagine Scruffy’s Chicken Shack (ticker: BUKBUK), trading at $80 per share. If it earned $4 per share over the past year, its P/E is 20 (80 divided by 4). It’s trading at a P/E ratio of 20.

There are also price-to-sales multiples, book-value multiples, cash-flow multiples and more. It can be helpful to compare a company’s multiples with those of its peers, to see whether its stock appears to be undervalued or overvalued. Nike, for example, recently sported a P/E ratio that was over 82, while Adidas’ was not quite 41. That suggests that Adidas is more attractively priced, though of course you’d want to assess many more factors.

Q: What’s the difference between a private company and a public one? – C.B., Bozeman, Mont.

A: Public companies have shares of stock available to trade on the open markets. They’re required to file quarterly earnings reports with the Securities and Exchange Commission, detailing revenue, expenses, debt loads, cash levels, taxes, income or losses – and much more. These reports are publicly available.

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Privately held companies are not public – meaning average investors can’t buy shares of them. They also don’t have to reveal much about their operations and financial health. According to Forbes, the 100 biggest private companies in America include Koch Industries, Cargill, Deloitte, PricewaterhouseCoopers, Publix, Mars, H-E-B, Pilot Flying J, Enterprise Holdings (parent of the car-rental company), Bechtel, Cox Enterprises, Fidelity Investments, Bloomberg, SC Johnson, McKinsey & Company, Staples and Amway.

Fool’s School

Prepare for disasters: It’s fine to prepare for unlikely disasters, perhaps by buying earthquake insurance in a low-risk region, or keeping garlic on you in case of vampire attack. But be sure that you’re preparing for more likely disasters, too, such as these:

Having a bad credit score: A bad credit score will doom you to high interest rates when you’re looking to borrow money, such as for a home or car. Start beefing up your score by paying down your debts and paying bills on time.

Losing your job: As the ongoing pandemic has made clear, unexpected job losses happen, and they can put you in financial peril. Make sure you have an emergency fund stocked with at least several months’ worth of critical living expenses, such as food, housing, utilities, taxes, transportation and so on. It’s also good planning to make yourself more hirable by learning new skills or getting new certifications or degrees.

Needing long-term care: Long-term care is an important issue everyone should consider. If you’re wealthy, you can pay for any care you might need; if you’re poor, you probably won’t be able to pay for it at all. But if you’re in between, consider long-term care insurance. Learn more at LongTermCare.gov.

Not being able to retire: This is a big disaster awaiting millions of people who haven’t socked away enough money to retire on. The best way out of this problem is to read up well in advance, make a plan and act on it. Good strategies include working for a few more years, saving as much as possible in IRAs and 401(k)s, cutting back on spending, taking on a side gig or two and perhaps cashing out a life insurance policy if it’s no longer needed. One of your best moves might be to invest long-term dollars in the stock market, perhaps via a low-fee index fund (such as one that tracks the S&P 500).

My smartest investment

Widened Horizons: My smartest investment ever was leaving my hometown and broadening my horizons. – M.I., online

The Fool responds: That’s a terrific investment indeed. There are countless benefits of traveling: By exposing yourself to other regions and countries, you can get a sense of how other people live – which may help you appreciate just how good you have it compared to billions of others. Getting to know people in other places can help you get over any fears of outsiders or foreigners, and enjoying their hospitality can make you feel like a citizen of the world, not just your state or country. You may even end up making some very good friends around the country or the world.

Trying a wide variety of foods from various cuisines can introduce you to flavors and dishes that become lifelong favorites.

Travel abroad can be greatly enhanced if you take the time to learn the language spoken at your destination – and knowing at least one other language can also be an effective career booster, as lots of companies have (or want to have) international operations and may send employees to other countries.

Travel can boost your self-confidence, as you navigate unfamiliar locations and successfully deal with unexpected events (such as missing a train in Japan). Finally, travel can simply be fun and exciting, and it creates memories to look back on for the rest of your life.

Foolish trivia

Name that company: Back in 1833, two men – a miller and a druggist who grew herbs – decided to make and sell drugs and essential oils. Their company ended up a part of me, along with many others. I got my current name after the 1958 merger between Polak & Schwarz and van Ameringen-Haebler. Today, based in New York City and with a market value recently near $13 billion, I’m a worldwide force in scents, tastes and ingredients. In 2019, I raked in $5.1 billion from about 38,000 customers. I’m merging with DuPont’s Nutrition & Biosciences division. Who am I?

Last week’s trivia answer: I trace my roots back to 1904, when a son of Italian immigrants founded the Bank of Italy in San Francisco, which morphed over time to become the world’s largest commercial bank by the 1930s. I’ve gobbled up lots of companies, including credit card giant MBNA, U.S. Trust, FleetBoston Financial (which traced its roots to 1784) and even Merrill Lynch. Today, based in Charlotte, N.C., I sport a market value recently near $262 billion. I serve about 66 million customers via roughly 4,300 retail financial centers, and about 31 million customers bank with me using mobile devices. Who am I? (Answer: Bank of America)

The Motley Fool take

Tech Dividends: Cisco (Nasdaq: CSCO), the world’s largest producer of networking routers and switches, has posted declining revenue for four straight quarters. Its infrastructure business, which generates over half its revenue, struggled with sluggish network upgrades, competition from rivals, the loss of Chinese contracts during the ongoing trade war and pandemic-related disruptions. Its smaller security business continued growing, but couldn’t offset its other weaknesses.

Cisco’s revenue declined 5% in fiscal 2020, but its adjusted earnings grew 4% as it cut costs and repurchased more shares. Analysts expect both its revenue and earnings to dip by about 1% this year. Those growth rates might seem dismal, but Cisco’s core business should heat up again after the pandemic passes. Warmer relations between the U.S. and China under the Biden administration could stabilize Cisco’s Chinese business, and it might pull customers away from Huawei as the Chinese tech giant struggles with trade blacklists and sanctions. A growing need for cloud and data center upgrades should also spark fresh orders for its routers and switches worldwide.

Cisco’s stock isn’t likely to rally anytime soon, but its low forward-looking price-to-earnings (P/E) ratio of 14 and its recent dividend yield of 3.2% should limit its downside risk. It’s raised its dividend every year following its first payment in 2011, and is likely to keep doing so. Consider Cisco for your long-term portfolio.

Copyright 2021 the Motely Fool
Distributed by Andrews McMeel Syndication

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Subprime Auto Loans: The Basics You Should Know

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Before you dive head-first into the world of subprime auto financing, it’s a good idea to know what you’re getting into and what to expect. We’re covering the common requirements of subprime lenders and the items you need to prove that you’re ready for a car loan.

What is a Subprime Lender?

Subprime lenders are also called bad credit auto lenders. They specialize in assisting borrowers with poor credit, those who’ve gone through bankruptcy, and those in other challenging credit circumstances. Subprime can also refer to the credit rating as well, typically defined as a credit score around 501 to 600, or those with a credit score below 660. Borrowers with credit in this credit score range are typically referred to as bad credit borrowers and may need the help of subprime lenders to get an auto loan approval.

Getting into a subprime car loan means finding a dealership that’s signed up with these lenders. Many dealerships are signed up with third-party lenders that can finance borrowers with lower credit scores. The finance manager at these dealerships acts as the middleman between you and the lender. Locations that are signed up with subprime lenders are called special finance dealerships.

Subprime lenders differ from traditional auto lenders (think banks, credit unions, online lenders, and some automaker’s captive lenders) in that a poor credit score isn’t enough to get turned down for financing. They know that your credit isn’t going to be perfect when you’re seeking a subprime car loan. So, they look at your credit history as a whole, your income, living situation, and many other factors to determine your creditworthiness and eligibility for vehicle financing.

Requirements of Subprime Auto Loans

Since every lender varies in their specific requirements, we can’t provide an all-encompassing list of requirements – but we can provide some of the more common ones you’re likely to encounter. At Auto Credit Express, we’ve created a network of dealerships that are signed up with subprime lenders. Thanks to our dealer network, we know the commonly requested documents you need to prepare for a trip to the dealership.

Subprime Car Loans: The Basics You Should KnowCommon requirements of subprime financing typically include:

  • Income – To qualify for any car loan, you need income. Subprime lenders usually require around you to have $1,500 to $2,500 of minimum monthly income (before taxes). Prove your income with 30 days of computer-generated check stubs that show year-to-date income. This requirement typically needs to be met by a single source, but some subprime lenders may allow multiple sources of income to meet this requirement in certain circumstances.
  • Residency – Subprime lenders require proof of permanent residence. This can be proven with a recent utility bill in your name, or a recent bank statement.
  • Down payment – Having bad credit almost always means needing a down payment to qualify, and subprime lenders typically require at least $1,000 or 10% of the vehicle’s selling price.
  • Working phone – Subprime lenders may need to contact you, so they require a working contract cell phone or landline phone. Proven with a recent phone bill in your name.
  • Valid driver’s license – To drive the car off the lot, you need a valid driver’s license. This also proves your identity. Your license can’t be revoked, expired, or suspended.
  • Personal references – This isn’t a requirement to qualify for financing, but it’s likely the lender will ask you for a list of references. Typically, they ask for five to eight references with complete contact information. The only requirement with references is that they don’t share your address.

Remember that these are only general guidelines for what to expect from a subprime lender, but it’s definitely a good place to start!

Your personal situation may require the need for more or different documents to qualify you for auto financing. For example, if you had a bankruptcy that was recently discharged, then you may need your discharge papers to prove you’re in the clear. Another common situation is if your income isn’t W-2 and you don’t receive check stubs. If you’re a 1099 worker, then you’re likely to need two to three years of tax returns to prove you have the income for an auto loan.

Letting the special finance manager know what your situation is can make the process easier, and help move it forward without too many snags.

Finding a Special Finance Dealership

Subprime lenders are third-party, so locating one without finding a special finance dealership isn’t likely to be easy, but we want to help. Let us get you connected with a dealership that’s signed up with subprime lenders in your area.

Here at Auto Credit Express, we’ve created a nationwide network of dealers that are ready to assist borrowers in all sorts of tough credit situations. Get started right now by filling out our free auto loan request form. There’s never an obligation to buy once you get matched to a dealer, it’s completely free, and we do all the hard work of looking for the bad credit resources for you.

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