Thursday, May 21, 2009

7 Steps To A 720 Credit Score Is Bull!

I received a copy of Philip Tirone's set of books, 7 Steps To A 720 Credit Score. Looking forward to reading it and giving it an honest review.

That became harder for me to do, when I started receiving call from them. The first call even offered me an affiliate marketing business opportunity. They however, decided I wasn't qualified, because I wouldn't urge people to get credit. Though they tried, I would not budge and was able to refute every argument they tried to throw at me. Especially, when they tried to tell me that I needed a credit card for when I travel. In their reasoning, if my debit card was stolen, my entire account could be cleaned out. Where, I would be "protected" with a credit card.

I informed them that less then 1% of Americans get mugged, so that was an unlikely scenario. Further, I have a separate account, that is specifically for travel. So, because of that my regular checking would not be bothered.

When I finally did get a chance to start reading the books, I couldn't discount everything. Especially, if one wanted to maintain a credit score, to purchase their first home. Which is the only debt, Dave Ramsey agrees to let his listeners go into. Personally, I believe (and I think Ramsey does to) that if you move up in house, it should be paid for with cash (from savings and/or the sell of the first home).
I started by reading, "Managing your credit after a financial crisis." Immediately upon starting the booklet, I started saying "bull."


you might be inclined to wipe your hands clean of credit, shred your credit cards, and become a cash only citizen.

But this attitude will only complicate matters. Because limited credit is as detrimental as bad credit, cash-only citizens have problems buying a home, financing a vacation, or purchasing a car....wiping your hands of credit is the last thing you want to do.


See, why I was saying, "bull?" If you are "financing," a vacation, you are stupid. You have no business taking a vacation, if you can't afford to pay cash for the trip. The same is true for a car purchase. If you have to borrow, you are buying more car then you can afford. Plan and simple. "Cash-only citizens," have no trouble at all to buy a car that they can afford from their savings. Besides, by not buying on credit, they only pay for it once. Whereas the person buying on credit, ends up paying twice as much over the life of the loan.



So what are the 7 steps?


  1. Keep your Credit Card balances under 30% of your credit limit.
    Well, if you are going to have a balance, that is pretty good advice.

  2. Have at least 3 revolving credit lines.

  3. No! No! and No! This idea is asking for trouble. His idea is that if you have a major delinquency then you should open 3 new credit card accounts and keep them current to counteract the negative credit rating. Sorry, but that's like handing a crack addict a rock of cocaine.
  4. Verify the accuracy of your reported credit limits.

  5. Yes, I agree when you pull your credit bureau reports, you should include this with any other errors, you may find.


  6. Have at least one "Helpful" active or Paid installment loan on your credit Report.

  7. OK, but really if you have credit at all, it should all be positive. You don't want any negative credit on your report. This step makes it sound like having negative credit is OK, as long as you have one positive installment loan. That is plane stupid.

  8. Remove all high-priority errors from your credit report.

  9. Negotiate before paying a bill in collections.

  10. Yes, Dave Ramsey is heard almost daily telling at least one person this. Listen, if you are already delinquent, then negotiating a settlement, is sound advice. However, two things never pay without getting the agreement in writing first. Second, never give the collections agent access to any of your accounts. They will (and have) wipe out your account.

  11. Create a structured plan to protect your credit.

  12. Ramsey, is often heard, telling listeners to make a plan and work their plan. Of course, he is talking about getting out of debt, where Philip Tirone is wanting you to stay in debt as a way to protect your credit.


This plan according to Tirone should include:


  • Create a budget and spend frugally.
  • (Dave Ramsey would concur with that.)
  • Keep your bills current.
  • Review your credit card bills and bank statements monthly.
  • Pull your credit report and review the 7 steps.
  • (Come on now-review the 7 steps? - Isn't Philip being a little self-centered there?)
  • Avoid being a co-signer
  • Keep your credit card accounts active
  • Protect your credit during and after a divorce.
  • If married, establish credit separately.

  • (Bull! The two become one. If you are married, it is a merger of two lives. That includes finances to. If you keep separate accounts, you are asking for trouble.)





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