WHITE RIVER FINANCIAL SERVICES

Credit Has More Than One Meaning

The word credit can be used in two ways:
   1. Credit allows you to buy now and pay later. You may be looking to buy something that you really need, but don't have the cash to pay for the purchase at that time.
   2. Credit is a person's reputation for paying bills when due. This is also referred to as your willingness and ability to pay.

Understanding Your Credit 

Your personal credit rating reveals your past credit activity and how it affects the financing terms you will receive from a dealership. The rating is an assessment of your spending, billing, payment habits and your overall debt load in comparison to your income.

YOU CAN RATE YOUR CREDIT
Below is a guide to help determine your credit rating:

Generally, the lower your credit rating, the higher the interest rate the lender will charge and the greater down payment will be required. As you use this, please understand that the figures you derive are designed to give you a ballpark figure for your loan. Many variables, including current market rates, your credit history, and down payment will affect your final terms. So while you'll have a good idea of how much you'll be paying, keep in mind as you enter the dealership that it's not the final word on your credit. Your dealer can help you figure out a plan that's right for you. Your terms will be agreed upon by you and your dealer.

If you didn't rate very high on our credit test, don't give up as you still have options. The benefit to financing through your dealer and Tracker Marine Financial Services is that we understand that not everyone's credit history is perfect. We've designed specific programs for qualified applicants with little or no credit experience.

CREDIT HISTORY
When you apply to finance through a dealership, the dealer will take a look at your credit history.

Your credit history is reflected in two important resources available to creditors, a Credit Report and Credit Score.

CREDIT REPORT
Your credit report helps creditors decide if they want to extend credit to you. It includes:

    * Personal information: Your name, current and previous addresses, Social Security number, date of birth, telephone number and current and previous employers.
    * Credit information: Your creditors and account details such as date opened, account number, amount borrowed, payment terms, credit limits, account balances and payment history.
    * Public records: Tax liens, bankruptcies and court-awarded judgments.
    * Inquiries: A listing of all parties that have requested a copy of your credit report. This includes formal inquiries (a list of all creditors who have accessed your credit report), promotional inquiries (this is where all those pre-approved offers come from) and account management inquiries by your current creditors (they have the right to review your credit report periodically). Promotional and account management inquiries are not shown to other creditors but are shown to you and do not impact your credit score.

HOW IS YOUR CREDIT REPORT GENERATED?
Each of the three major credit-reporting agencies (or credit bureaus) keeps a running tab on your credit history, based on the information it receives from creditors and public records, among other sources. When you apply for credit, creditors will request a copy of your report from one or more of these bureaus.

The contents of your credit report may be used to compute your Credit Score.

CREDIT SCORE
Your credit score can can either work in your favor or it can work against you. Your goal is to maintain a good credit score, as these scores are used by creditors when they're deciding whether or not to extend credit to you.

FICO® Scores
The most commonly used credit scores generated by the credit bureaus are often referred to as "FICO® scores", even though each of the three major credit bureaus has its own name for these scores. FICO® stands for Fair Isaac and Company, the company that produces the software used by many credit bureaus to calculate your credit score. These scores range from 300–850, the higher, the better.

Over the years, this three-digit scoring system emerged as a way to compare how the information on your credit report compares with each bureau's credit history on hundreds of thousands of other consumers.

Basically, your credit score suggests to creditors how likely you are to repay your debt.

Because your credit score is such an important aspect of obtaining an extension of credit, multiple factors are used to compute your credit score:

    * Past payment history – Have you paid your credit accounts on time?
    * Amounts owed – How much credit you have available vs. how much you owe
    * Length of credit history - How long have you had your credit accounts?
    * New credit and credit inquiries - Have you recently taken on more debt?
    * Types of credit established - May include credit cards, home mortgages, and car loans


Different Scores from Different Sources
The truth is, there is no one score. Every bureau has its own scores for different purposes and each bureau uses its own method of calculating your credit score based on the criteria listed above.

Additionally, it's quite probable that at any given time, each credit bureau will report a different credit score for you. They all attempt to remain as current as possible, but the resulting score is only as accurate as the information that they have available. This is why you should check your credit scores from time to time.

Creditors may use the scores they obtain from the bureaus in their own formulas to determine a credit score of their own. While we can't identify the factors used by every creditor in identifying your credit score, it's safe to assume that these formulas incorporate your credit bureau score as it fluctuates from time to time. Fluctuations can be used as a guide to understanding your financial behavior (how likely you are to repay a debt).

Your Credit Is Always Changing
It's a tough job trying to keep track of everyone's credit. While the credit bureaus try to stay on top of your credit history, sometimes things are missed and the different bureaus may maintain different data about you. Therefore, your score from any given credit bureau is a reflection of the most recent information they have on you, so it's possible for your credit score to change on a daily basis. Here's what you can do to help your credit.

To remain in good credit standing, you must take a proactive approach to guard your credit history. We outline the various ways to do this in Credit Tips .