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A New Academic Study Scrutinizes Credit Score Reporting

The all-important credit score has gained so much significance in our modern lives that a team of researchers from the University of Missouri plan to spend more than a million dollars to study it.

The group of experts was given $1.13 million in grant money by the U.S. Federal Trade Commission, and the educational institution released a statement to the media explaining that the focus of their research is to gain more insight into the how disputes related to credit scores are resolved. Under the Fair Credit Reporting Act – a piece of legislation that attempts to protect consumers from unfair lending practices – anyone who has a credit score is entitled to contest it, ask for errors to be corrected, or block access to their credit history. The study hopes to find out whether the process for resolving problems with credit score is effective and efficient.

They will also study how use of credit is evolving and how the payment habits of consumers impact their credit worthiness and overall financial health. We all know by now that Americans tend to spend money like crazy when it doesn’t belong to them and that they then suffer burdensome repercussions trying to pay back all those loans and credit card balances. The new research will hopefully shed fresh light on the subject to help educate consumers about how to use their credit more responsibly.

Tags: Credit Score, Credit Score Reporting, Reporting, Score Reporting

It’s been long overdue, but the list of the best cash back credit cards has finally been updated.

Is there a viable replacement for the sorely missed Schwab Visa card? What cards are worth looking at? Are there cards missing from the list? Check it out!

Tags: Back Credit, Back Credit Cards, Cards, Credit Cards

Sooner or later every credit card charges interest, regardless of the promotional benefits offered during the introductory period. However, if the card balances are repaid in full before the end of the grace period, then it is possible to avoid interest altogether. Nonetheless, the majority of cardholders only repay a percentage of their outstanding balance, and some even choose to pay the minimum amount due, which can actually have a negative effect on their credit score. Unfortunately, every credit card issuer utilizes a different APR calculation method, the most common of which are explained below.

The annual percentage rate (APR) must be divided by the number of billing periods within a year (usually one for every month) to determine the periodic rate, which actually dictates the amount of interest charged each month. Thus, a 12% APR would have a periodic rate of 1%, (12% APR divided by 12 billing periods equals 1% periodic rate). The periodic rate is multiplied by the outstanding card balance to calculate the monthly periodic rate.

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Tags: Card, Credit Card

I often reference the “FICO Seven Deadlies” in my articles and interviews but it just occurred to me that I’ve never actually written about them as one consolidated list.  This is important because credit rules our lives.  If you have good credit you can do many things, inexpensively.  However, if your credit is bruised or broken, you’ll have a harder time functioning effectively in the world of personal finance.  So what are these seven deadlies?