This was from a lunch and learn series that I put together to help people understand their credit report.

1. Understanding Your Credit Report Nick Sosnowski, V.P. of Lending, IAA Credit Union

2. What the Heck is “Credit”

6. So Lets jump on in and take a look…

9. What makes up your credit score?

12. Credit Score – Capacity Joe The Story of Old Joe…

13. Has 5 Cards with $2,000 limit on each TOTAL LIMITS=$10,000 Pays off his balances each month but averages $1,500 in charges each month. AVAILABLE RATIO ($10,000-$1,500)/$10,000 = 85% Credit Score - Capacity A+

14. Since he never uses 4 of the 5 cards he closes them. TOTAL LIMITS = $2,000 New AVAILABLE RATIO: ($2,000-$1,500)/$2,000 = 25% Credit Score - Capacity F Expect a score drop of 70-90 points!

17. So what does my report look like?

19. Accounts that have been placed by a collection agency or charged off. Includes 1 st Mortgages, 2 nd Mortgages, Home Equity Lines, Land Loans Includes all credit cards, store cards, credit lines, sometimes Home Equity Have a beginning and an end. Car Loans, Boat Loans, can include Mortgages Everything Else. Single Pay loans, Traditional Amer. Express Cards, Diners Club

22. Reflects your minimum payment not what you actually pay. It is better to have it low and pay more.

23. High Balance will be the most you ever charged. The Limit is your credit limit. Lenders can tell if you have gone over your limit

24. The comments are VERY important. A Closed account could be closed for many reasons, so you want it to say nothing or what this account says.

26. What to Lenders See? Not Always Reliable

28. AVAILABLE RATIO! Always have at least 1 back-up card that you don’t use!

36. So now I know everything about credit reports, what do I do next?

38. QUESTIONS? Nick Sosnowski V.P. of Lending 557-2541 [email_address]