SOURCE: A New Horizon Credit Counseling

Credit counseling, debt consolidation, Credit Card Debt

December 07, 2009 16:25 ET

A New Horizon Credit Counseling Reports FICO Discloses Effect of Credit Mistakes on Score

Credit Counseling Can Help Avoid These Costly Mistakes

FT. LAUDERDALE, FL--(Marketwire - December 7, 2009) - A New Horizon Credit Counseling Services Inc., is a national, non-profit credit counseling organization dedicated to providing counseling services and financial education programs to individuals and families from all walks of life.

For the first time, and with unusual candor, FICO revealed "damage point" data and how exactly credit mistakes affect credit scores. These "damage points," depending on the reason for the credit mistake, can reduce a credit score by 10 to 240 points. The higher the credit score, the more damage the SAME credit mistake can affect FICO scores.

Common examples that affect credit scores are:

--  Making late payments can decrease a credit score between 60 and 110
    points
--  Maxing out a credit card or exhausting the credit limit can decrease a
    credit score between 10 and 45 points
--  Negotiating DEBT SETTLEMENTS with creditors can decrease a credit
    score between 45 and 125 points
--  Filing for bankruptcy can decrease a credit score between 130 to 240
    points
    

Understanding what affects a credit score is important and how that impacts not only the ability to get credit in the future, but also how it affects one's monthly credit card payments, as it also causes interest rates to adjust.

In order to avoid situations that negatively affect FICO credit scores, consider talking with a reputable Credit Counseling Service company. "The circumstances identified by FICO that can damage a credit score all can be avoided by receiving credit counseling and employing a structured debt management plan. The debt management plan will ensure and maintain on-time payments of obligations while you systematically reduce debt; all of which translates to an improved FICO score," says Steven Stark, Chief Operating Officer and General Counsel at A New Horizon Credit Counseling Services in Fort Lauderdale, Florida.

At the end of the day, it is all about protecting credit scores and not allowing monthly payments on credit cards or mortgage loans to increase or even worse, losing the ability to get credit. If you would like more information on how credit counseling may help your FICO score contact Stuart Lieberman who may be reached at (800) 556-1548 Extension 1126 or at slieberman@anewhorizon.org. A New Horizon Credit Counseling - www.anewhorizon.org

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