Improving someone’s credit can be a daunting yet fulfilling process. There are many things that can be done to make improvements but the barrage of information makes it hard for credit seekers to understand what truly will be the best moves for their unique situation.
In this episode, Victoria Finlay and John Williams sit down with Nikole Vialet, a credit repair specialist, and discuss what you could expect when working with her or other specialist like her, as well as some of the quick and easy strategies everyone can implement on their own to start improving their credit almost immediately.
In this episode, you will learn:
- The most important things you can do to improve your credit score
- The many different ways a credit repair specialist can help their clients
- Why is it so important to achieve and maintain strong credit?
- All of the different things that positively and negatively affect your credit
- And more!
Can you give us a general idea of what the credit repair business entails?
Well, generally the credit repair business is the business of helping clients remove any negative obsolete, outdated, or inaccurate items from their credit report, and also helping them understand how their credit score is weighed to avoid them from making the same mistakes going forward. A lot of people get credit cards at an early age and don’t know what the consequences are or how to maintain that credit. So we, as a company, help customers who already messed up that stage and to get them back on track to teach them. We help teach them how to avoid that same mistake and any negative items like could be bankruptcies, medical bills, collection accounts, repossessions. So a lot of people have these things on their credit and they don’t know how to get them removed.
What are some of the quick and easy things people can implement to jump their credit immediately?
Well, credit repair is definitely not an overnight process. A lot of people think that, but just a couple tips to boost your credit score fast. I recommend you call all of your credit card companies every six months to ask for a balance increase. The reason why I say that just, for example, if you have a thousand dollar credit limit and you spend, $400, $500, you’re over your 30% that you’re allotted. And with the 30%, if you call your credit card company and say, “Hey, can you increase my credit card limit?”, and they say, “yeah.”, and they increase you from a thousand to 2,500. Now you’re within the 30%, that’ll increase your score automatically because that’s 30% of the puzzle of the credit card.
Why is it important to have a good credit score?
Well, what I say is an 800 credit score has more purchasing power than a hundred thousand dollars. You can walk into a car dealer and get whatever car you want. Walk off the lot you can purchase a house, run a yacht, whatever you like to do, if you have an 800 credit score. So, having poor credit is very expensive. If you have poor credit, your interest rates are higher. And of course, to me, you’re flushing money down the toilet. Your car insurance is higher because your credit is poor. Car payments, for example, if you go into the car dealer and ask for a $20,000 car with a five-year loan, someone with good credit can get 6%. Someone with poor credit can get 26%. That’s about a $13,000 difference in interest that somebody with poor credit will be making will be paying. So why would you want to do that?
What is considered a “good” credit score?
Okay. So FICO score, the range could be anywhere from 300 to 850. I recommend anyone have a a score of 650 or higher. 30% of the American people have a FICO score of less than 650. So that’s about a hundred million people in America with less than 650 FICO score. So most creditors are looking for at least a 700 or better to get a decent rate, or for them just to approve you off the, off the bat..
How do late payments affect your credit score?
Well, I just recommend don’t be late because if you want to maintain your credit the way you want it to, then you can’t be late. You have to set up automatic payments. You have to set up reminders in your calendars. These are things that you’re responsible to do. Granted, I know everybody is not like they forget they have 50 bills lined up, but you have to set up a system that’s going to work for you. So you will not miss your bills on your payments, but late fees, it’s just extra. You’re paying $100. They ain’t got to pay $135 because you’re one day late. Why would you want to do that to yourself? To set up automatic payments, especially for your main stuff, your mortgage, your rent, your car payments, credit cards. Even if you do the minimum. I was in a situation before where, um, I wasn’t getting paid a lot of money. When I first started at the bank. I had a lot of debt, but I was never ever was late with my payments. Because even if they asked for a minimum of $35, I would pay the minimum of $35. I know the interest would be astronomical down the line. But at that point, I only can afford the minimum payment due that if you only can afford the minimum payment, just do the minimum, just don’t miss it because that will hurt you.
How do credit limits play into this process?
I recommend you call all credit card companies the same day. You have a seven day grace to contact the credit card companies for them to give you one inquiry on your credit report. So if you have seven credit card companies that you’re calling, you’re going to only get that one inquiry. If you call them within the seven days. So you call them all seven credit card companies and increasing that balance helps drastically for an increase on your credit score. You want to keep your total balance below 30% of your available credit. If you are above this threshold and you can’t pay them down below that threshold, an increase in credit limit may do the trick.
If you call five credit card companies within seven days, it’ll just be one inquiry. One inquiry can lower your score up to 10 points. So now if you call three of them, yes. So if you call three of them today and the other two in 14 days, and you will have two increases.
How does applying for credit affect your score?
Hard inquiries are when you applying for a line of credit and they are actually actually pulling your social security number and they’re looking through your credit report. Um, soft hits are like, um, car insurance companies, car insurance companies randomly say, you know how you get the pre-approval Hey, Nicole, you pre-approved to get, save $500 in your car insurance. Those are soft hits. Those are just seeing what ranger in. They’re not affecting your credit score at all.
How does closing credit cards affect your credit score?
Cancelling credit cards can negatively affect you in a small way temporarily but in the future it can have great positive affects. It’ll be better because me personally, I only have two major credit cards. I tell everybody to get credit cards, that’s going to work for you. If you like traveling, get something that’s going to give you miles. If you like, if you shop all the time, get something that’s going to give you cash back for your shopping, get something that’s going to benefit you. Having multiple store cards, doesn’t make any sense because you can use your actual credit card to purchase at that store. So if you have small cards that aren’t doing anything for, you should just close them out.
Nikole, thank you for being on the show. How best can people reach out to you?
My email is [email protected], my instagram is @ladyvialet and my phone number is 973-280-2917. You can call me, email me anytime if you have any questions. I know many people are embarrassed or ashamed about having poor credit. Please do not be ashamed. Anything that’s broken can be fixed and I’m here to help you do it.
Thank you for listening, everyone. This is John and Victoria. Have a great day.