Page 23 - Winning The Credit Game Bundle (CK Patrick)

HOW CAN I BENEFIT FROM CREDIT? 11

You have such a good track record at the credit game that different
“teams”—banks or creditors—will make you competing offers to try to
get you to play for them.
If you have a poor credit score, on the other hand, you might suffer
the classic tragedy of that unathletic kid on the playground: you might
get picked for the team last, and given all the worst positions to play.
The unfortunate side effect of this system is that it often favors the
wealthy—those who already have so much money that paying the bills
is not a challenge for them—while harming those living in poverty,
forcing them to pay much more for pretty much everything they might
desire to possess via high interest rates.
The good news is, we can fix your interest rate and make you a
credit superstar no matter how little money you have. In this game,
strategy is even more important than raw power. Let’s start learning
how to do that now.

HOW TO BUILD YOUR CREDIT SCORECARD

If you were a coach deciding what players to hire for your team, what
factors might you look at? You might look at things like:

How many games they had won in the past.
How many teams they had played for successfully.
How frequently they screwed up, costing the team points.

This is quite similar to how banks and creditors evaluate you as a
borrower. The exact formula used to determine a FICO credit score—
the most common credit score used by banks and creditors to deter-
mine whether to lend you money, and at what interest rate—goes
something like this:
1. Payment history. This is basically your track record for winning
games. A bill paid on time is a credit game won. A bill paid over 30
days late or not at all is a game lost. The more games you’ve won in
the past, the more a bank or creditor wants you to play for their team.
And the more they are willing to “pay” in terms of low interest rates