The Creative Investor - Know Your Credit Score

Knowing your credit score is a very important piece of being a successful investor and a good money manager. Real Estate can be purchased with poor credit, however having a strong credit score will make things much easier. The first step to having a strong credit score is knowing what your credit score is.

How do I find out what my credit score is at this time?

There are several sources that you can use to determine your credit score, some free and some paid. The following are good sources that you can utilize at this time:

FREE https://www.annualcreditreport.com Or you can call each of the credit agencies and request a report:

Equifax: 800-685-1111; www.equifax.com

Experian: 888-EXPERIAN (888-397-3742); www.experian.com

TransUnion: 800-916-8800; www.transunion.com

Privacy Guard is a service that provides all three reports and a score on a monthly basis www.privacyguard.com

How do I know if my credit is good or bad?

Credit scores range from 300 to 850. The following is a good break down of a good and bad score based on where your score is:

700 and up - are considered excellent
600 - 699 - are considered good
500 - 599 - are considered risky
499 and less - are considered very risky

As an investor you want to target a 680 and above credit score in order to obtain loans easily for your investment purchases.

What if my score isn't where it should be If your score is currently under 680 the following are a few things that you can do to increase your score: Your payment history is a major factor as it represents 35% of your credit score. So always, always, pay your bills on time. Late payments and collections can have serious consequences on your credit score. Limit the amount of credit you apply for. Applying for too much will decrease your credit score because this is a characteristic of high credit risk groups. Keep your credit in use to 25-30% of the credit limit. Having a higher balance will impact your credit score negatively.

It is extremely important that you have any mistakes corrected on your credit reports right away. A mistake may be an item that isn't yours, an old account, an account that you don't recall being late on or any other item that is negatively impacting you. When you dispute items the creditor has 30 days to respond, if they don't the item is removed

. Do not close any old accounts as you try to clean up your credit and improve your score. Creditors like to see loyalty, in fact 15% of the score is based on the length of time you have had the credit. Do not pay off any collection accounts with out first sending the creditor a pay for deletion letter and trying to arrange a compromise in exchange for the item being deleted from your report.

If you currently do have credit cards that are maxed one thing you can do is to try to get the limits raised. This will restructure your balance so that you are using less of the available credit and will improve your credit score.

Make knowing your credit score a regular financial activity Make it a habit of knowing your credit score and striving to keep it in the 680 or above range. This will greatly improve your ability to obtain financing when it is needed for your Real Estate investing.

Stefanie Blackburn is an active investor in the Colorado, Michigan and Texas markets. She has done a number of successful short sales over the last couple of years that have resulted in win-win solutions for all parties involved. Stefanie has recently started www.resuccesslink.com - a resource for investors.