advance of a major loan purchase to clean up your credit report and bump up your score. Credit scores can’t be used, or requested, by employers to determine hiring or firing. Employers can, however, use information from credit reports, but they have to ask your permission first. Working with a credit counseling service to corral your finances won’t negatively affect your credit score and does not appear on your credit report. However, the Federal Trade
Commission cautions consumers against
credit repair services, and offers free credit
repair information on its website at www.ftc.
p n E r,
“There’s absolutely nothing that a service
can do for you, if you have low credit or poor
credit, that you cannot do for yourself,” says
Carlson. “If there’s information on your report
that is true and accurate, but is negative, no
one can get that expunged from your report—
not a credit repair agency, and not you.”
So, to sum up, better credit means better
credit scores. Better credit scores mean better
credit. Happy roads ahead! C
The basics behind the
number that drives
your financial health
By Rita Colorito
ON THE ROAD to financial health, it pays to
know, and mind, your credit score. This three-digit number determines how much a lender
will loan you and at what rate. The higher your
credit score, the lower your rate for mortgages,
car loans, credit cards, insurance premiums,
etc. Landlords can also use your score to
decide whether to rent to you.
“A credit score reflects your ability to
make good on a promise,” explains Karen
Carlson, director of education for InCharge
Debt Solutions, a credit counseling service.
The three major credit bureaus—Equifax,
Experian and TransUnion—compile your
credit report. Despite some variations, the
report basically includes your personal information, the credit lines you have open and
your payment history. You’re legally entitled to
a free credit report every 12 months from each
of the three credit bureaus, available through
AnnualCreditReport.com, the official website.
Using a computer algorithm developed by
Fair Isaac Corporation (FICO) that digests
information in your credit report, each bureau
crunches your credit score. While the FICO
score is the best known, a lender may use
another “brand” of credit score, which could
result in a different number. When you apply
for credit, lenders will often disclose your
score at no cost.
Credit scores fluctuate as information in
your credit report changes. Under the Fair
Credit Reporting Act, if you’re denied credit,
insurance or employment, or if your credit
rate increases, you’re entitled to a detailed
explanation and a copy of your credit report
and credit score from the credit bureau used to
make that determination.
Several factors fuel, or drain, your credit
score, according to FICO.
● Payment history accounts for about 35
percent. The simple solution: “Pay your bills
on time,” says Carlson.
● Credit utilization comprises 30 percent.
“People with the highest scores tend to only be
using 20 to 25 percent of their available credit,”
says Carlson. To drive up your score, drive
down your debt. “You’re the best candidate for
credit when it looks like you actually don’t
need it,” she adds.
Rita Colorito (
her credit report regularly.
The Costco Connection
Costco’s identity protection service provided by IDENTITY GUARD® includes credit
reports and daily credit monitoring based
on data compiled from the three major
credit bureaus. The Credit Analyzer allows
you to explore the impact that various
credit actions may have on your credit.
Monitoring alerts help protect against
identity theft. The service starts at $9.99
a month for Executive members. To learn
more, visit Costco.com and search
“Identity3” or call 1-866-818-0874.
Fraud prevention? Check, please
TO HELP STOP fraud in its tracks, Costco
offers enhanced security checks. While all
of the checks available through Costco’s
check-printing service come with state-of-the-art fraud-prevention features, the
enhanced security checks help prevent
check fraud and identity theft with the
addition of a 3D hologram border. This
special border is very difficult to reproduce
with conventional printers and copiers.
The security checks also use thermo-chromic ink that disappears when heat is
applied and reappears once cooled. The
word “SECURITY” is embedded over the signature line and signals attempted photocopying if it appears altered. The security
checks also feature an intricately patterned
border and a prismatic background pat-
tern, both difficult to reproduce.
As an added safety measure, the
checks are shipped with secure and
Two boxes of enhanced security
checks—a total of 350 checks—cost $25.80
about Costco’s check-printing program,
visit Costco.com, select “Services” and
then select “Checks & Forms.”
—Stephanie E. Ponder
JUNE 2012 ;e Costco Connection 23