Life insurance offers protection for your family’s financial security. Many people buy themselves a life insurance policy that will protect their family. It’s also possible for people to purchase life insurance policies for someone else. For example, children can purchase policies for their parents and vice versa.
Life insurance coverage offers valuable financial protection. You need to find a policy that meets your coverage needs and fits your budget. Here are three tips that will help you find the right fit:
Understand Policy Options
Premium rates vary based on the kind of policy you choose. There are two broad categories of life insurance—temporary and permanent.
Temporary life insurance, or term life insurance, offers a death benefit payout if the insured passes away during the timeframe the policy covers.
Policyholders can choose the length of the term and the death benefit amount. Some companies offer additional coverage options, called rides, that can be attached. These range from accelerated death benefit riders to return of premium riders. These additional riders add more value to the policy, which also affects the rates.
Permanent life insurance has its own two categories—whole life and universal life. Both kinds of permanent life insurance accrue cash value over time. The cash value can be used to purchase paid-up additions, pay premiums or be borrowed against.
Like term life insurance policies, policyholders can choose to add additional coverage with riders. Riders vary by company and affect the monthly premium.
Whole life policies typically have the highest premiums because the coverage is permanent, and there’s generally a guaranteed cash value growth rate. Most whole life policies come with high death benefit amounts. Policyholders can choose the amount when they sign up for the policy.
However, for those who need less coverage or only enough to cover funeral expenses, final expense insurance policies are a great option. Final expense insurance is designed for seniors. It’s a type of whole life insurance, but the death benefit amounts are much lower. Because the death benefit is only enough to cover funeral expenses, premiums tend to be lower.
There are a few kinds of universal life insurance policies. The biggest difference with these policies is how the funds are invested. The cash value of variable universal policies is invested in multiple accounts, including stocks and bonds. The cash value of indexed universal policies is invested in indexes, which are diversified investments.
Because there is no guarantee of how the cash value will grow in the investments, universal life insurance premium rates tend to be lower than whole life insurance premium rates.
Work with an independent agent
While the various types of life insurance are common among life insurance companies, not all companies carry every kind. It’s a good idea to know what kind of life insurance policy you want before starting to work with companies.
If you’re not sure what kind of life policy you want, work with a life insurance agentto ensure that you find an affordable policy that meets your coverage needs. A licensed agent can help you through the entire process of selecting and applying for a policy.
Working with a licensed independent agent also has other advantages. The specific terms, riders and premium rates can vary by company. Independent agents sell policies from multiple companies, so they can help you compare similar policies across companies.
An independent agent can help you understand the underwriting process and find a policy that is a good fit for your situation. In addition to comparing coverage and terms across companies, an independent agent can help you compare premium rates.
Working with an independent agent makes the research process easier for you because you don’t have to reach out directly to companies. Instead, you can work with one person to find the best company and rate for you.
Use quote websites wisely
While some people like working with an agent, others may prefer to do independent research. Quote websites come in handy because they make it easy to quickly view your options.
There are many life insurance quote websites to choose from. So, how do you know if you’re working with a good company?
First, it’s important to understand what kind of quote website you’re using. Some websites, like Geico and Progressive, show quotes from multiple life insurance companies. These quotes allow visitors to compare their policy options across companies. However, these companies just show quotes and connect their visitors to companies.
Others, like Bestow, HavenLife and Ladder, only show quotes for the policies they offer. These companies help their clients through the application process, which is another benefit of working with them.
Others, like Quotacy, show quotes from multiple life insurers and help their clients through the application and underwriting process. Quotacy agents even assist their clients in making updates to their policy after they purchase a policy.
Second, it’s important to know what kinds of policies the website shows. Many online tools focus solely on term life insurance. While this is a shared characteristic across many quote websites, each one has its unique features.
For example, Ladder stands out because its policies allow policyholders to adjust coverage during the term as their needs change.
In contrast, other quote websites show quotes for different kinds of permanent life insurance. This is true of many sites that only offer quotes, like Geico and Progressive. Websites that offer more comprehensive services, like Quotacy and Policygenius, also offer quotes for permanent life insurance policies.
Finding affordable life insurance
Life insurance offers valuable financial protection for your family. It can pay off remaining debt, cover funeral expenses and even replace income.
While the protection offered is highly valuable, it’s important to find a plan that fits into your monthly budget. The first step is determining what your needs are and which kind of life policy best meets those needs. From there you can work with an independent life insurance agent and do your research into policies and premium rates offered by different life insurance companies.
Alice Stevens loves learning languages and traveling. She currently manages debt and tax relief, life and health insurance, and car warranty content for BestCompany.com.
When you’re trying to conquer unpaid debts sent to collections, two of the biggest obstacles you face are coming up with enough money to pay off the debt and negotiating a payment plan or settlement you can afford. Once you’ve accomplished these tasks, you may still be wondering how you pay collections to a debt collection agency.
Familiarize yourself with the steps for how to pay collections before you take the plunge and submit your payment.
1. Verify the Debt
Before you make any payments or acknowledge ownership of the debt, make sure you actually owe the debt and that it’s not outside the statute of limitations. In this era of debt collection scams, also verify that the debt collection agency actually exists and you’re not being targeted by a scam. Ask for verification of the debt in writing and verify with your state attorney general’s office or the Better Business Bureau that the collection agency is legitimate.
You can also collect information to validate the debt by checking your credit report each year and monitoring your credit score for suspicious activities or inquiries for free at Credit.com.
2. Know Your Rights
“When dealing with debt collectors, many experts always look to the Fair Debt Collection Practices Act,” warns financial consultant Damon Day. “I agree it’s important to know what collectors can and can’t do.”
Debt collectors must provide a written notice explaining the debt, including the amount, the name of the creditor and your right to dispute the debt.
Debt collectors may not harass, threaten, or mislead you.
Debt collectors cannot publish your personal information, use profane language, or repeatedly call you.
Debt collectors cannot contact other people about your debts more than once.
Unless specifically requested otherwise, debt collectors can only call between 8 a.m. and 9 p.m.
Debt collectors may not call you at work if you ask them not to.
If your attorney is handling your debts and you have told a collector to speak only to them, they cannot contact you directly.
Your debt collection rights also limit who collectors can talk to you about the debt. Debt collectors can speak to you, your spouse and your attorney, if you have one. They can’t discuss your debt with your family members, friends or employers and can only call them once to locate you. There is also a statute of limitations for how long collection agencies are able to pursue legal action against you.
3. Determine What You Can Afford to Pay
Starting a budget can help you understand what you can afford to pay each month. Go over your income and expenses to come up with a realistic amount you can pay over a specific time period.
4. Negotiate a Settlement
When you can’t afford to pay a balance in full, don’t be afraid to negotiate a settlement with a debt collector to reduce the amount you must repay. Successful negotiations may include these steps:
Explain your current money situation without getting too specific.
Start negotiations by offering a payment lower than what you are willing to pay.
Get a counteroffer from the collector and go through several rounds of offers before reaching an agreement.
Obtain all settlement details in writing before submitting any payment.
Your goal is to get the debt collector to agree to an amount less than or equal to what you decided you can afford to pay. However, some collectors may refuse to negotiate and will demand you pay the debt in full. Don’t let a debt collector bully you into paying an amount you can’t afford or that causes you to let your other financial obligations slide.
5. Make Your Payment
Once a debt collector sends you a written agreement with the total amount you’ve agreed to pay, review it carefully for accuracy before you take the final step of submitting your payment. When you make your payment, avoid giving your bank account or debit card information to the collection agency. Instead, pay with a money order or certified check, if possible.
6. Document Everything
Document your payment thoroughly, including sending it through certified mail with a signature required on the return receipt. Follow up with the collection agency to ensure your payment was credited to your account, and check your credit reports with the credit bureaus to confirm the debt is no longer being reported as outstanding.
How Do You Pay Off Medical Debt in Collections?
Paying off medical debt is similar to paying off any other type of debt, but there’s generally more room to negotiate the terms of repayment and a reduction of your debt. Some medical providers let you pay for “financial aid” or an in-house payment plan so you can keep the debt from going into collections and damaging your credit. Other ways to pay off your medical debt include the following:
Pursue payment plans offered by many medical providers.
Apply for medical credit cards for specific procedures.
Hire a medical bill advocate to negotiate on your behalf.
Apply for an income-driven hardship plan.
Seek nonprofit organizations that help pay off medical debt.
If you have a verifiable hardship, such as a disability that prevents you from working, you may also be able to pursue medical bill forgiveness. Your medical provider will need your tax returns and other written documentation that proves you have no means to pay your medical debt.
How Should You Pay a Collection Agency?
There are several options when it comes to how you should pay a collection agency, including paying with your bank account, credit card or debit card, or paying with a prepaid debit card, money order or cashier’s check. However, some payment methods are riskier than others, and most experts agree you should avoid giving your bank account or debit card information to a debt collector.
Bank Account Draft/ACH
Most debt collectors ask for your checking account information so they can take your payments right out of your account. It’s a convenient option that typically costs you nothing, but it’s not always a safe payment method. The general consensus is to avoid giving your bank account information to a debt collector, unless you’ve set up a separate account specifically for this purpose.
“Never pay this way,” says Mike Arman, a retired mortgage broker. “Auto debit is permission to access your account whenever they feel like it and then say ‘Oh, we made a mistake’—and do you think you’re getting any money back? They can also come back later for more, whether by ‘accident’ or design.”
Mailing a personal check is a cheap payment option, and you have the canceled check as proof of payment, but it’s not very fast. For this reason, it’s not usually at the top of the list for preferred payment methods by debt collectors. Plus, you’re giving your checking account information to the collector, which may be bad news for you. Avoid using a personal check, unless it comes from a separate account set up to pay the debt collector.
Alternatively, you can use your financial institution’s online bill pay service. Gregory B. Meyer Community Relations Manager at Meriwest Credit Union explains, “Your online banking sends them a check that’s basically guaranteed funds like a cashier’s check, but your personal info, like your account number, doesn’t show on it.”
Under the Fair Debt Collection Practices Act, debt collectors aren’t supposed to deposit postdated checks before the date on the check—or even threaten to do so. If a collection agency accepts a postdated check that’s dated more than five days in the future, it’s also supposed to notify you in writing 3 to 10 business days before depositing it. However, not all debt collectors follow these rules, so it’s best to avoid postdated checks.
“Collectors will say that sending postdated checks is part of the terms. It’s not true and you can negotiate that,” says Leslie Tayne, a New York attorney who specializes in consumer debt resolution.
The general advice when it comes to debit cards is the same as paying with bank account drafts or ACH payments: avoid it. Debit cards access funds in your checking account, so it still gives the collector access to this account. If the amount charged to your debit card is wrong or if there are multiple withdrawals when you only agreed to one, you must fight the debt collector to get the money returned to your account. Although you’re generally protected against unauthorized withdrawals under the Electronic Funds Transfer Act, it may be difficult to prove the amount wasn’t approved since you gave the debt collector your debit card information.
Paying a debt collector with a credit card doesn’t make the debt go away. Instead, you create a new debt and additional finance charges, so most advisers will say to never use credit cards to pay debt collectors.
“Paying one debt off while racking up new debt is an oxymoron in itself,” warns Howard Dvorkin, founder of Consolidated Credit Counseling Services. “If a person truly finds themselves in a financial situation where they’re borrowing from Paul to pay Peter, they need to reach out for help.”
Any collection agency that accepts debit or credit cards can accept a prepaid card. You simply load money onto the card and give the collector your card number. The card isn’t tied to your bank account, so your personal information remains private. Most prepaid cards allow you to spend only what’s loaded onto the card, so you don’t have to worry about overdraft charges or the debt collector pulling more money from your account, as long as you only load what you plan to pay.
Prepaid cards solely used to pay a debt collector are a relatively safe alternative, but make sure to look for a low-fee card and keep a record of your payment. Also, watch out for debt collection scammers who instruct targets to load money onto a prepaid card then mail the card to them. This allows scammers to be paid with virtually untraceable funds, and refunds are impossible.
Law Office Check
If you have an attorney handling your case, one of the safest ways to pay collections is to have them do it for you. “Pay your attorney and have your attorney send them a law office check,” suggests Arman. “Even the dumbest bill collector knows better than to screw around with a check drawn on ‘The Law Office of . . . ‘. There’s also an unassailable audit trail, and the bill collector never gets ANY of your account information.”
Debt collectors like money transfers from services like Western Union or MoneyGram or wire transfers directly from your bank or credit union account to the collector’s account because they get paid quickly. However, a money transfer can be expensive, and it’s difficult to confirm whether the debt collector received payment. It’s also a potentially risky payment method because money transfers are the preferred payment method for scammers, warns the Federal Trade Commission. It’s like sending cash, and you can’t get it back because there’s typically no way to reverse a transfer or trace the money.
Money orders are relatively inexpensive and can be purchased at a post office, bank or credit union and most convenience stores and grocery stores. On the downside, it’s difficult to prove a collection agency cashed the money order you sent. It’s a cheap payment method that helps you maintain financial privacy, but make sure you keep your money order receipt and proof of delivery in case the collector says you didn’t pay. A similar alternative is a cashier’s check These cost a bit more than money orders, but they’re easier to prove payment.
While it’s uncommon for debt collectors to accept PayPal to collect on a debt, it’s possible a collector would allow this payment method. PayPal is likely safer than letting a debt collector take money from your bank account, but transfers could take several days and there may be fees involved the collector makes you pay.
Should You Pay Off Collections?
You should pay off collections to avoid hurting your credit score and having to deal with wage garnishments or bank account levies. An outstanding collection account lowers your FICO credit score and stays on your credit report for seven years from the date of delinquency. This can hurt you even if you’re not trying to borrow money. For example, if you’re seeking new employment, being considered for a promotion, trying to rent an apartment or applying for or renewing your insurance, a longstanding unpaid account on your credit report could make you appear untrustworthy and negatively impact all these situations.
Create a Debt Payment Plan
While debt collectors aren’t required to accept a payment plan, they can be a great way to get a debt paid off. Keep in mind that making any kind of payment arrangement with a debt collector can restart the statute of limitations on your debt, and this time limit varies by state. Create a payment plan that reflects what you can realistically pay by setting up a budget. Based on how much you can afford to pay, you can set up one of the following:
A short-term payment plan that lets you pay off the debt in a set number of months.
A lump-sum payment plan that’s scheduled for a specific date.
A partnership with a debt management company to arrange one monthly payment to be distributed amongst your creditors.
More Tips for How to Pay Collections
1. Don’t Cave to Pressure
Some debt collectors may tell you that you have to use the payment method they prefer and use high-pressure tactics, such as threatening to mark you down as “refusing to pay” if you won’t. It’s not illegal to refuse to use any payment method, so stand firm if you need time to figure out how to pay.
2. Keep Good Records
“Regardless of payment method, consumers should always keep documentation of their payment,” says Mark Schiffman, Director of Public Affairs for the credit and collection industry trade group ACA International. “Keep these records in a place you can access them easily and indefinitely. Debts sometimes resurface years later.”
3. Negotiate Fees
“Watch for fees related to payments,” says Tayne. “Find out if there’s a check by phone fee or other fees related to a particular payment method. If so, ask for it to be waived.”
4. Follow Up
“I cannot stress this more: make sure the payment was entered correctly or received,” says Tayne. “There are so many times when the person taking the payment makes a mistake, and the payment doesn’t go through. Make sure all payments are received, applied and the settlement is still valid.”
How Long Does It Take for a Paid Collection to Come Off Your Credit Report?
Even when you pay a collection account, it generally still doesn’t come off your credit report for seven years. However, with a little pushing, you may convince the debt collection agency to contact the three credit bureaus and remove the collection account earlier.
If you’re unsure of what’s on your report, sign up for Credit.com’s free Credit Report Card to track your credit. Receive the latest tips and advice from credit and money experts, an easy-to-understand breakdown of your credit report information and a free credit score and action plan.
Many manufacturers warranty their products against defects or certain other issues for a period of time. This is known as the manufacturer’s limited warranty, and depending on the product, it might provide coverage for a period as short as 30 days or as long as three or more years. In many cases, by swiping the right piece of plastic at checkout, you can get an automatic credit card extended warranty.
What Is Extended Warranty Coverage?
An extended warranty is any coverage that goes beyond what the manufacturer provides automatically when you buy a product. Extended warranties are often available for purchase from third parties.
For example, you might purchase an appliance at a home-improvement store like Home Depot or a piece of electronics at a big-box store such as Best Buy. When you pay, you might be asked if you want to purchase extra warranty coverage of several years beyond the manufacturer warranty. In some cases, these warranties step in to provide additional coverage, such as replacing the product if it is damaged or falls victim to typical wear and tear.
What is a Credit Card Extended Warranty?
Some credit card accounts come with a special perk. If you purchase a qualifying product with your card, the card network backs your purchase with an extended warranty coverage. The extended warranty coverage that comes with some of the best credit cards usually extends the manufacturer’s warranty for up to a year longer.
The length of an extended warranty offered can vary by card, and the credit card network won’t extend a warranty past a certain time. Typically, if the manufacturer offers more than a five-year limited warranty, no card network adds time to that. Some only add time if the manufacturer’s warranty is three years or less. Others only add to a manufacturer’s warranty that ends within 12 months.
How Can You Tell if Your Credit Card Includes Extended Warranty Protection?
Many major cards, including some on Visa, American Express and MasterCard networks, offer warranty protection. The best way to find out if your credit card company includes this perk is to read your benefits guide, which is included in the paperwork that came with your card. You can also usually find this information online if you have an online account for the card or you can call the customer service number for your credit card issuer and ask.
Does My Visa Card Have an Extend Warranty?
If your card is a Visa Signature card, then this extra perk is included. Simply look for the words Visa Signature on the front of your card. If you don’t see those words, consult your benefits paperwork or call customer service to get the details about card benefits.
Does Capital One Offer Extended Warranty?
Yes, some Capital One cards come with extended warranty protection. This is because Capital One cards are typically issued on either the Visa or MasterCard network, and it’s the network that provides the warranty coverage.
Does the Costco Visa Include Extended Warranty Perks?
How Does the Visa (or Other) Extended Warranty Work?
Credit card extended warranty programs have some unique guidelines but do tend to follow the same overall concept. You pay for an eligible item with your credit card. If a covered issue arises after the manufacturer’s warranty coverage is up but before the extended time period covered by the card network, then you can file a claim to be reimbursed for the loss. To file a claim, you’ll need to call the benefits administrator for your credit card issuer.
American Express: 1-800-225-3750
When you make a purchase with your credit card, keep the receipt in case you need to file a claim. Also keep the manufacturer’s warranty, receipt, serial number and product description information on hand. You’ll need all of this information when you make the phone call to file a claim.
Make it a habit to start a paper file whenever you spend big on something. That way, you’ll be ready in case you need to use this benefit. But do note that not all purchases are covered by these rewards. Examples of what’s not covered include boats, motorized vehicles, computer software and used or pre-owned items.
Extra Protection by Paying with Credit Cards
The credit card extended warranty isn’t the only perk you might get when you pay with your credit card. Some cards offer buyer’s remorse protection, ensuring you can always return eligible items within certain windows, or travel and road protections for peace of mind when you find yourself 100 miles or more away from home.
Understanding how credit cards work and what benefits you get from yours lets you get added value when making purchases. Start off right by choosing the best credit card for your needs and using it wisely as one resource in your personal money management toolbox.
Many Americans struggling with managing their debt become frightened to pick up the phone because of debt collectors. You’ve probably heard stories about deceptive debt collectors, and you may even have been a victim of a debt collection scam. But you’ve probably never heard anything about what it’s like to be working in collections.
Learning more about debt collectors and working in collections gives you a valuable perspective of the people who are just trying to do their jobs. As a consumer, this insight can also help you understand your rights when you owe a debtand how to handle debt collection attempts.
The continual rise in complaints doesn’t mean collectors using a more aggressive method or breaking more laws. Many debt collectors carefully comply with fair debt collection rules and work for collection businesses that follow the standards and laws that tell them when and how they can contact you.
Unpopular Career Choice
Becoming a debt collector isn’t exactly a popular career choice. Debt collectors get used to negative reactions from people when they tell them what they do for a living.
“People cringe when you tell them what you do,” says Michelle Dunn, a debt collector and author of Dealing with Aggressive Debt Collectors: What to Do and How to Do It by an Industry Insider. “A lot of times you don’t want to tell them what you do. They’re only dealing with debt collectors when they’re in a bad situation.”
While most of the debt collectors and collection companies Kerri Fivecoat worked with while in the industry for more than a decade would try to take a calm and compassionate approach with debtors, she says there were a few exceptions who put the industry in a negative light.
“There are people who enjoy debt collection,” Fivecoat says. “They would really get into what they were doing, and they didn’t have the personality to start out being nice with people. They were more forceful or more assertive, and sometimes it was effective.”
Bryan Franzoi has spent more than 15 years in debt collection and even though he has worked with some bad collectors, he says the stigma about debt collectors is incorrect. “Ninety-nine times out of 100, there’s a totally wrong misconception,” Franzoi says. “They’re really just trying to put you in a better financial situation.”
“Most people who are bill collectors don’t take happiness in yelling at people,” says Dunn. “They don’t get into this business because they want to be mean to people.”
Fivecoat says she was normally a top performer at her company just by listening to the people on the phone and trying to come up with solutions. “If you’re faced with a debt collector who is aggressive,” explains Fivecoat, “the best path to take is to ask to speak with someone else.” She employed this strategy herself when she and her husband were in a tight financial spot and were receiving collection calls of their own.
“As collectors, we trade off people if someone isn’t able to make headway with them,” Fivecoat says. “There’s always someone they can transfer you to.”
The average salary of a debt collectorwas $13.79 per hour or $37,041 annually in August of 2019. This salary could be higher in some positions, if the company offers bonuses and/or commissions on the accounts you’re able to collect on. Some companies also offer profit sharing, especially collection companies collecting for another company that rewards their top performers.
How to Act When Debt Collectors Call
When you’re struggling financially and falling behind on your bills, debt collectors may begin calling you. There are numerous things debt collectors won’t tell you, but some of the best advice many collectors give consumers is to stay in touch.
“The worst thing you can do is ignore the calls,” Dunn says. “Send a letter. At least respond in some way. Wait until the company closes and call, if you want to avoid the conflict. By ignoring it, the account gets escalated to legal quicker, and you’ll get calls more often and even letters.”
“Honesty is also a key component of communicating with debt collectors,” explains Franzoi. “A lot of consumers run and hide and not answer the phone, and then we have to hunt them down. If someone answers the phone and is honest with us, we can normally find a solution.”
Several debt collectors agree that consumers often think they must pay the full bill or nothing at all, which is often a costly mistake. Debt collectors like to use payment plans as a tool to get consumers to start paying the debt, even if it’s only a little bit at a time. Dunn previously setup payment plans for people for as little as $5 or $25 a month because it let her get them to commit to paying something and keep communication lines open.
“If a debtor is receptive to it, I can take them through their monthly bills and try to get them in better financial shape,” Franzoi says. “The last thing your bank wants to do is charge off your account or foreclose on your house.”
It’s Emotional on Both Sides
When you’re trying to get out of debt, it’s often very emotional for you and the debt collector. It’s not just overspending or lavish lifestyles that could lead debt collectors to your door. Circumstances like an illness or unemployment often leads people into debt, which makes the situation even more emotional.
“When somebody’s in debt and they have bill collectors calling them, that’s not their only problem. They normally have something else going on,” Dunn says. “The last thing you need is a bill collector calling you. It’s common for people to lash out.”
In Dunn’s case, she’s even received death threats in her career as a debt collector. Although she says it’s hard not to take consumers’ threats personally, the key is trying to understand the position the debtors are in.
“I’ve also received thank you cards from debtors,” says Dunn. “If they owe you money, most of the time they owe other people money, too. I just treated them differently.”
“Emotional stories from people we call makes debt collection a tough career path,” says Franzoi. “The housing crash of 2008 and 2009 was especially tough. You’re a human being, you’re going to be affected by it. There have been times where it has been very upsetting to me, and I even had an employee break down and start crying when I was working as a manager of debt collectors.”
How Can You Improve Your Debt Collection Skills?
If you’re a debt collector, you can improve your debt collection skillsby tapping into your ability to communicate. Be prepared by learning all you can about an account you’re attempting to collect, keep information well organized and document everything. Always act professionally by avoiding confrontation, manipulation, getting angry or harassing the consumer. Provide an incentive to pay, recap any terms that were agreed upon and keep the lines of communication open by following up.
How Do You Succeed in Collections?
To be successful in a debt collection career, you must be able to reign in your temper when consumers lash out at you. Maintaining a calm demeanor in stressful situations helps keep the people you contact calm as well. Good listening skills are also pivotal to success. When you pay attention to a consumer’s concerns and learn how they fell into debt, you’re better prepared to offer a viable solution and negotiate the best repayment terms for the debtor and the creditor.
Having a wallet full of plastic can be a big temptation to overspend, which can lead to missed payments and a decreased credit score. If too many credit cards have you busting your budget, this might be a good reason for credit card closure. On the flip side, closing a credit card may hurt your credit score by messing with your credit history and credit utilization rate.
Depending on your situation, there are reasons for credit card closure. Canceling a credit card isn’t a bad idea if you close accounts that cost more to maintain than they’re worth and do it in a way that won’t significantly hurt your score.
Why Would a Credit Card Company Close Your Account?
While you’re considering your reasons for credit card closure, your credit card issuer might be doing the same thing. A credit card company has the right to cancel your card any time, and you may not get any warning it’s been canceled until it’s declined at the register.
A credit card provider will close your account if you quit paying the minimum monthly amount due. Missing one or two payments may only freeze your account until you’re caught back up, but your account will probably be closed after six months of nonpayment. Credit card companies have many other reasons for credit card closure.
Common reasons that may prompt a credit card issuer to cancel your account include:
Inactivity with a zero balance for several months
A drop in your credit score, especially due to late payments to other companies
Eliminating the type of card you have and closing everyone’s accounts
Going out of business because they’re no longer profitable
Do Closed Accounts Affect Your Credit Score?
Closing an account can affect your credit score because it can change your credit history and utilization rate, which are two major factors used to calculate your credit score. Your credit history is based on the amount of time all your credit card accounts have been open, so closing an older account can hurt.
Your credit utilization is based on the amount of available credit you’re currently using, so closing an account with a large credit limit and low balance can hurt even more. When deciding whether you should close a credit card account, consider some reasons why credit card closure makes sense.
1. You’re Getting Divorced
If you’re getting separated or divorced from a person who shares a joint account with you, close the account. Otherwise, you remain fully responsible for any bills your soon-to-be-ex might run up on the card. Even if your divorce decree says your former spouse will be responsible for the bill, you’re still on the hook as long as the account remains open. The credit card issuer is only interested in collecting the balance and will look to both accountholders for payment.
2. You Don’t Want to Pay the Fees
If your credit card company is charging an annual fee that you don’t want to pay, ask them to waive it. You can also ask them to waive a late fee if you’re accidentally late and you’re rarely late. If the credit card issuer won’t budge on a hefty annual fee, it could be a good reason for credit card closure and taking your business where there’s no annual fee.
3. The Card No Longer Makes Sense
Maybe you have a card you specifically opened to take advantage of frequent flyer miles because you traveled often for business. If your job no longer requires you to jet around the country or you move somewhere not serviced by the airline associated with this account, the card loses its appeal. Most airline rewards cards carry hefty annual fees after the first year, so it makes sense to close these accounts and switch to a card with a more useful rewards program.
4. The Card Has Been Used Fraudulently
Credit card fraud is the best reason for credit card closure. Typically, the credit card issuer automatically closes your account and issues you a new card when your credit card has been lost or stolen. However, this isn’t always the case when your card is used in other potentially fraudulent ways, such as:
You subscribed to a product or service online and, despite your best efforts to cancel the subscription, you keep getting hit with a monthly charge for something you no longer want.
You provided your credit card number for the collection of monthly payments on a debt, but the company is taking larger payments than you agreed to make.
You let your children use your account once for an emergency, and now, they use it every time another “emergency” occurs.
In these and similar situations, you may want to close your account. Otherwise, you risk having to fight to get future charges reversed.
5. You’re Done with Debt
You may have reached the point where you see no other way to get out of debt than to cancel your credit cards. It’s best for your credit score to keep a credit card or two open and just pay the balance in full each month, but this approach may not work for you. If you know you can’t resist the temptation of whipping out the plastic when you want something you can’t afford, it could be a good reason for credit card closure. However, before you make that decision, ask yourself two questions.
Is It Better to Close Unused Credit Cards?
Sometimes it can be better to close an unused credit card, especially if the card has a hefty annual fee. When you don’t use a credit card enough to outweigh the annual fee and come out ahead on its rewards program, the card is costing you money. It’s probably better to close an account in this situation.
Is It Bad for Credit to Close a Credit Card?
It can be bad for your credit to close a credit card if the card your closing is one of your oldest credit accounts and/or has a high credit limit with a low balance. As previously mentioned, closing older accounts hurts your score by lowering the length of your credit and payment history. Closing an account can also hurt your credit by changing the amount of your revolving credit utilization.
How to Exit Gracefully
If you’ve decided that closing a credit card account is the best course of action, try to minimize the damage to your credit score as much as possible. A credit card in good standing offers a lot of positive credit history that stays on your credit reports longer if you keep it open.
Although closing the account doesn’t make the card automatically disappear from your credit reports, you do lose the benefit of the available credit associated with that account. This changes your balance-to-available-credit ratio or revolving credit utilization.
To understand the credit utilization aspect of your credit reports, get a free credit report card from Credit.com. Calculate your balance-to-available-credit ratio by looking at your available credit compared to how much of this credit you’re using on individual cards and all your credit cards combined. When you’re using a significant portion of your available credit, you lose points when your credit score is calculated. Before closing an account, keep these factors in mind.
1. Keep Your Credit Utilization Ratio Low
An open credit line with a large limit and zero balance helps lower your overall revolving utilization, especially when you’re carrying balances on your other accounts. Keeping utilization at 10% is ideal, but you can still have a good credit score when using up to 25% of your available credit. Before closing an account, calculate how it changes your overall utilization to ensure losing that available credit won’t hurt your score much.
2. Keep Accounts Open
If you have several old accounts, closing one won’t impact your score as much as it would if you only had a couple. Keeping as many of your older accounts open as possible is better for your credit score. If you have only one credit card, it’s seldom a good idea to close your account. About 10% of your credit score is based on the different types of credit you have.
3. Keep Oldest Accounts
Whenever possible, keep your oldest accounts open. Most scoring models consider the age of your accounts, including your oldest and newest accounts, and the average age of all your accounts. A seasoned credit history helps keep your score healthy. A closed account also eventually falls off your credit report, and you lose all the positive history associated with the account.
After weighing the pros and cons, sometimes it just doesn’t make sense to keep hanging onto a credit card. Before you close that account, make sure your credit score won’t suffer too badly. Sign up for Credit.com’s Credit Report Card and receive the latest tips and advice from a team of credit and money experts. You also benefit from a free credit score and action plan that helps you determine whether closing a credit card account is right for your situation.
You don’t have a separate rating called a mortgage credit score, but lenders do look at your score, credit history and several other factors when deciding whether to approve you for a home loan. Contrary to what some people think, though, you don’t necessarily need an excellent or good credit score to get a home loan. How high your score is depends on your current financial situation, down payment and other factors.
What Does My Credit Score Need to Be for a Mortgage?
The short answer is that it depends. Mortgage lenders will do a hard inquiry on your credit to see the score and the details behind it. Your credit score is typically a good first impression on how risky of an investment you are. Mortgage lenders don’t want to be left holding the keys to your home if you don’t or can’t make regular monthly payments, or if you make late payments, on your home loan.
Factors that can impact whether your credit score is high enough to be approved for a mortgage include:
What type of home loan you’re seeking
How much other debt you have
The details of your credit history, such as positive and negative items reported to the credit bureaus
The size of your down payment
FHA mortgage loans may be among the easiest loans to get in terms of credit score requirements. Individuals who qualify as first-time home buyers under FHA (Federal Housing Administration) backed lending programs may be able to qualify for mortgage approval with a credit score as low as 580 and a low down payment of only 3.5%. In cases where buyers can put forward 10% or more for a down payment, some lenders may approve individuals with FICO scores as low as 500.
For more conventional loans—those that meet the underwriting standards put forth by Freddie Mac or Fannie Mac—approval usually requires a good credit score. At minimum, these types of loans usually require a FICO score of around 620, but that assumes other factors are in your favor. A lower down payment or higher credit utilization, among other things, could mean you need a higher credit score to secure mortgage approval.
What Is a Decent Credit Score for a Mortgage?
The answer is probably 620 or higher. You do want to minimize any surprises during the mortgage application and home buying process. Take the following steps to avoid this risk.
Get a look at your credit score and report. If you have bad credit, consider taking steps to improve your credit score.
Dispute or work with a credit repair company to fix any inaccuracies on the report before you apply for a mortgage.
Evaluate whether your credit history and score positions you to achieve your homeownership goals now or if you should take time to improve your score organically first.
Consider working with a mortgage broker if you’re uncomfortable with the entire process. These pros can often help you understand which type of mortgage is right for you and how to qualify for it.
Can You Buy a House with a Credit Score of 590?
You may be able to qualify for an FHA or nontraditional home loan with a low credit score. Your chances of doing so are higher if you can tie your low score to a single issue and you otherwise have a strong credit history. You can also increase your chances by lowering your credit utilization rate, having a low debt-to-income ratio and saving up to put a large percent down when you buy the home.
Should You Get a Mortgage with Your Current Credit Score?
Ask yourself this important question: Are you so preoccupied with whether you can get approved for a mortgage with your current credit score that you forgot to ask yourself whether you should?
Your credit score impacts more than whether or not a lender approves you for a home loan. It also impacts your loan and term options, which can impact the overall cost of the home. One of the most important parts of the mortgage that may be tied directly to your credit score is the interest rate.
A good or bad credit score can mean a shift up or down for your mortgage interest rate. And even a fraction of a percent in either direction can drastically change how much you pay for your home. Consider the examples below, which are applied to a $200,000 home loan for a term of 30 years.
An interest rate of 3.92% equals payments of $946 per month and a total home cost of $340,427 over 30 years.
An interest rate of 4.42% equals payments of $1,004 per month and a total home cost of $361,399 over 30 years.
An interest rate of 4.92% equals payments of $1,064 per month and a total home cost of $382,999 over 30 years.
Just a difference of 1% can result in savings (or losses) of more than $40,000 over the life of your mortgage. Use Credit.com to check credit score and credit report card to make sure your credit score is as high as possible before you start the mortgage application process.
Javier Gonzales is legally a homeowner, but he says his first instinct is to say “no” if someone asks. This is because he hasn’t made the mortgage on the townhome he bought in years, and he doesn’t live there anymore. Gonzales says he owes $476,000 on the townhome, which is only worth around $263,000. “I don’t care about it. I don’t want it,” he says, and he’s not the only one in such a situation.
When the housing bubble popped in 2007-2008, millions of homeowners ended up with homes that are worth less than they owe on them. This can be a big problem when they’re ready to sell. If you owe more than a house is worth and want to sell, but aren’t sure what to do, here are six options.
1. Stay and Pay
There are several reasons you might choose to keep making the payment on a house, even if you owe more on it than it’s worth. You might have a strong attachment to your home and want to avoid foreclosure. Maybe you’re worried that your credit score will be damaged because of missed payments. Regardless of the reason, it may be best to stay and keep making the payment until the home’s value recovers.
While this is an option, it’s one that should be thought about carefully. It can take many years before you get back to right-side-up. Cathy Moran, a bankruptcy attorney in California, says, “I am spending a lot of energy talking people out of homes on which they are spending too much money and have no hope of having any equity in for at least a decade.”
If you decide to stay and pay, you may be able to get financial help to catch up with payments if you run into financial hardship. For example, the Emergency Homeowners Loan Program (EHLP) provides interest-free loans that may be forgiven over time to homeowners who have fallen behind on their mortgages. Because these programs change frequently, it’s a good idea to work with a HUD-approved housing counseling agency in your area to find out which programs may be available.
If you want to move in the next few years but can’t afford to take the hit on selling your house immediately, refinancing can be a way to get out from under your mortgage faster. This is especially true if you’ve been in the house for a while and have made decent progress on the principle.
Refinancing for a traditional 30-year loan with a better interest rate could lower your payments into manageable territory if you’re struggling. But if you have the cashflow, refinancing for a shorter-term loan can help you get what you owe in line with what the house is worth faster.
What happens if the mortgage is more than the home value? You can still refinance, but it may be more difficult to find a lender willing to take it on. If something happens and you default, the lender doesn’t have much hope of recouping their entire investment. However, programs such as HARP can help if you’re interested in refinancing.
3. Get a Loan Modification
A loan modification is another option that can help you stay afloat if the only reason you’re looking at selling is that your payments are too high. But even though your monthly payment may be lower, you’re probably going to be paying more money in the long term because the modifications are usually for a longer term.
This might be a good option if you’re not too far in the red on your house value and the local real estate market is back on the upswing. But it may make matters worse for someone who owes $100,000 more than the home is worth and wants to move in five years.
4. Go for a Short Sale
A short sale is a way to sell the house for less than it’s worth and possibly not have to worry about the difference. Short sales can be a good alternative for people who are facing foreclosure and can’t do a traditional sale. But they do have to be approved by the lender, which doesn’t always happen.
Before you go through with a short sale, it’s important to understand what impact it can have on your future finances. Here are some commonly asked questions about this option.
Can you sell your house if you owe more than it’s worth?Yes, you can, but depending on your state, you may still be responsible for the remaining portion of the loan. In a short sale, it may be possible to get the lender to sign a waiver of deficiency, which means you’re free and clear at the end of the sale.
Can you sell a house you haven’t paid off?Yes, a house doesn’t have to be sold to be put on the market. The majority of sellers still owe on their properties, but if you owe more than the home is worth, you could have difficulty getting enough money for it in a traditional sale.
What happens if you sell your house and still owe money?In most cases, you will still be responsible for the rest of the loan amount. However, if you were paying PMI or your lender agreed to a waiver of deficiency in a short sale, you may not have to pay that moneyback.
5. Walk Away/Foreclosure
If you’re not able to make selling work for you, the last option is to just walk away from the house and let the bank foreclose. While it may seem like this is a straightforward way to get out from under a big payment and a bad investment, many people don’t understand what a foreclosure means for them.
First, it will be a big hit to your credit. You can still take steps to rebuild, but you won’t be able to just go buy a cheaper, more affordable house. Some lenders require you to wait until the foreclosure is offered your credit report to be eligible for another loan, although FHA, VA and Department of Agriculture loans have shorter wait times. You could also still end up on the hook for the difference in the home’s value and the total you owe if the house doesn’t sell for the full balance and you don’t have PMI.
When you owe more than your house is worth and want to sell, it can be difficult to know what to do. It’s important to get advice from a qualified financial professional so you can better understand how each option may affect your particular situation.
An FSA card is the debit card that allows you to access money in your flexible spending account. This is an account that is set up alongside your health insurance, and you can choose to have pretax dollars from your paycheck routed into it. Those funds can then be used to pay for certain qualifying medical expenses.
What Are the Benefits of an FSA?
The biggest benefit of a flexible spending account (FSA) is that it can reduce how much you pay in taxes. You don’t pay taxes on the money that is deposited into this account out of your paycheck. If you know you’ll spend all of the money on qualifying expenses within the time period required, you can cover medical costs you’d already have to pay for while lowering your tax burden.
Some people also like FSAs because they lighten the burden of health care costs throughout the year. If you put money from every paycheck into the FSA savings account, then it may be easier for you to pay for prescriptions, copays and deductibles later.
How Does a FSA Debit Card Work?
Flexible spending account options may be offered alongside your employer-sponsored health plans. They are also sometimes an option when you purchase insurance in the health care marketplace. However, you must choose to enroll in the FSA plan—it’s not an automatic part of your coverage, even when it’s available.
Once you enroll, you can decide how much of your pretax income you would like to contribute to the account. The IRS limits you to contributing $2,650 per year to this account. Someone who is married can contribute up to the same amount into their spouse’s FSA.
Once you fund your FSA, you can use the account to pay for eligible medical expenses or buy eligible qualifying products. One way of doing so is by using your FSA card just as you would use any debit or credit card at check out.
Remember to only use your FSA on eligible expenses, and keep your receipts and another backup. If you’re ever audited, the IRS may ask you to prove that you used your FSA money for approved spending.
Payments to doctors, hospitals and other health care providers that are part of your copay or deductible
Any medication that is backed by a doctor’s prescription, including over-the-counter meds
Insulin, even without a prescription
Necessary medical equipment such as crutches or walkers
Diagnostic devices such as glucose monitors or blood pressure cuffs
Supplies such as bandages
Vision care, including eyeglasses or contact lenses
Can I Use My FSA Card Online?
Yes, you can use your FSA card for online spending, as long as it’s one of the eligible expenses listed above. That might include making a payment on a bill to your doctor’s office via an online portal or buying prescribed medical supplies via an online vendor.
Can I Get Cash Off My FSA Card?
In rare cases when you need to pay for qualifying expenses but the provider or store doesn’t take your FSA card, you can use your card to withdraw cash to make the payment. However, you must keep all the documentation proving that the amount you withdrew was used for eligible expenses. If you’re ever questioned by the FSA provider or the IRS about the withdrawal and you don’t have the supporting documentation, you may be required to payback those funds.
Are There Any Downsides to an FSA Card and Account?
The biggest disadvantage of an FSA account is that the funds are use-it-or-lose-it—even though it’s your money. FSA providers let you know what the deadline is for using all of your contributions from the year. They typically range from January through March of the following year.
Because you can’t simply withdraw the unused funds or spend them on something else instead, make sure that you estimate your medical expenses using as much information as you can. And when in doubt, estimate slightly lower so you aren’t left with a loss at the end of each year.
Is an FSA the Same Thing as an HSA?
An FSA and a health savings account (HSA) are slightly different. HSAs are only available to individuals with high deductible plans. Because of this, the contribution limits are higher. HSA balances also roll over to be used for the next year, unlike FSA balances.
Does Your FSA Card Impact Your Credit?
“While FSA cards look and behave like credit or debit cards where they’re accepted,” says credit scoring expert Barry Paperno, “like debit cards, they don’t appear on your credit report or get included in your credit scores. That’s primarily because they’re not truly credit accounts where a lender is making a loan to you. Rather, the FSA consists of money you have transferred, or will be transferring, from your paycheck.”
If you’re worried that your FSA might impact your credit score, it might be a sign of general anxiety about what’s on your credit report. Sign up at Credit.com to get access to your credit score and reports for greater peace of mind.
While it’s not something many people think about until faced with the issue, obtaining a credit report for a deceased person is important. You may need to make sure the credit report is accurate and take stock of any creditors you need to notify of the death, or see if there’s any unresolved debt that you’re not aware of.
It’s not uncommon for criminals to try to take advantage of the fact that someone who has passed isn’t checking their credit, which can increase the chances of identity theft and credit card fraud. That’s why it’s crucial to handle this process as quickly as possible.
Obtaining Someone Else’s Credit Report
In general, only the person who is the subject of the credit report should have access to it. But there are times when you may need to pull someone else’s report, such as the death of a loved one. Other instances may be when you’re checking someone’s credit as part of an application for a job or a rental property or if you’re helping someone work on their credit. Here are some commonly asked questions about obtaining someone else’s report.
How do you check someone’s credit history?You must have permission to check someone’s credit history, which can be as simple as them checking a box on a rental or job application. Once you have their permission, you can use their Social Security number, name and date of birth to do a background check that includes a credit history.
Can you look up someone else’s credit file?Yes, you can, but you have to have their permission and their personal information to be able to pull the correct report. This is common in situations where an agency or individual is helping another person repair their credit or address inaccuracies after identity theft.
Should you notify credit bureaus of a death?Yes, you should notify the three major credit bureaus as soon as possible after a death to ensure that the account is marked as deceased and no one else can open credit in the person’s name.
Obtaining the Credit Report of the Deceased
One of the most common situations where you will need to obtain someone else’s credit report is if a loved one dies and you are the financial power of attorney and/or executor of the estate. Here are the steps you need to take to obtain your loved one’s credit report after they’ve passed and how to protect their legacy.
1. Collect All the Paperwork
It’s a lot easier to begin the process of obtaining a credit report if you already have the paperwork needed. Each of the three different credit bureaus may have different requirements to be able to report someone dead and obtain their report, so you may want to call and find out what documents are required beforehand. The most commonly requested are:
A copy of the durable financial power of attorney, if applicable
Proof that you have been named executor of the estate
Testamentary letters from the probate court
An official copy of the death certificate
It’s a good idea to get at least one copy of these documents for each of the three bureaus, but you’ll also probably want a copy for yourself and another backup just in case.
2. File the Will If Necessary
Before you can start the process of obtaining the credit report, you’ll need to file the will with the probate court. To do this, you’ll need a certified copy of the death certificate, which can be obtained from your local health department for a small fee. If there is no will or named executor of the estate, you may need to file with the courts to be named as executor.
3. Submit a Death Certificate and Other Documents to the Credit Agencies
Once you have all of your documents gathered together, you’re ready to start submitting the paperwork to the credit bureaus. Remember that you’ll need to report the death and ask for the report from all three major bureaus: Experian, TransUnion and Equifax. Along with the death certificate, power of attorney and testamentary letters, you’ll also need to include a cover letter explaining that the person has passed and that you need to obtain the reports to put their affairs in order. Your letter should also include:
The deceased’s name
Last used mailing address
Social Security number
You may also need to send along a check or pay via phone or online to obtain the report, depending on the bureau’s policies and how recently the credit report was last obtained.
4. Review the Credit Report
Go through the credit report thoroughly checking for any inaccuracies—name and address misspellings are common—and make note of any open accounts that need to be paid with the estate or notified of the death. It’s a common misconception that all debts are automatically cleared when a person dies, but this isn’t the case, so it’s important to know what will still need to be taken care of. Make sure to be on the lookout for anything unusual-it could be a sign of suspicious activity.
5. Update Any Creditors and the Social Security Administration
The last step is to update the credit bureaus, any outstanding creditors and the Social Security Administration of the death. You may be asking, “What happens to your credit report when you die?” Until the credit bureaus are notified that a death has occurred, nothing happens to the credit report. Once the proper documentation has been submitted and the request made, the bureaus will mark the account as deceased.
This means that no further credit will be extended in the person’s name and no additional accounts can be opened up, which helps protect against identity theft and credit card fraud. The death certificate should be all that’s needed to complete this step.
Credit cards, interest rates, loans, even where you live—these all depend on your credit score. If you have a good credit score, you’re more likely to get better financial offers. But if you have a low or nonexistent score, the chances of getting prime financial offers are pretty slim.
If you have low or nonexistent credit, improving your credit can seem almost impossible. Because you don’t qualify for the best financial offers, you can’t get the opportunities you need to bump up your credit. Plus, you’ll probably find yourself paying a lot more interest than you’d like.
This might feel like a no-win situation. But there’s good news—there are alternatives to building credit besides credit cards. Those with poor or nonexistent credit can have the opportunity to build up their scores. Learn about good credit scores and how you can work to get your rating in that range.
What Is a Good Credit Score?
If you’re completely unfamiliar with credit, it’s time to learn where your credit score stands. Here’s the breakdown—credit scores range between 300 and 850. According to Experian, an average credit score for Americans is around 675.
Credit scores are ranked as bad, poor, fair, good or excellent. Experian’s numbers are based on a model called VantageScore. The VantageScore model is broken down to the following:
FICO scores are based on a slightly different model with a range of 300 to 850. The average FICO score in 2018 was 704. For FICO ratings, a good or excellent score is above 740. Here’s the breakdown of FICO Score ratings:
Very good: 740-799
Very Poor: 300-579
How to Build Low or Nonexistent Credit
It is possible to get a credit card for bad credit. But you’ll find that they’ll either have no rewards, higher interest rates or both. These are worth looking into, but you might want to consider other methods before you commit to a credit card. Here are some great options for building your credit score—that aren’t getting a credit card.
1. Get a CreditStrong Account
In a frustrating turn of events, building or rebuilding credit often requires that you havesome credit to begin with. That’s where credit builder loans, such as the ones provided by CreditStrong, come in handy. Credit builder loans allow you to take out a loan without a hard credit pull. The money is placed in a locked savings account to secure the loan.
Once you make the required payments, the savings account is unlocked and you gain access to the funds. In the meantime, you get up to 24 months of positive payment reports to the credit bureaus, helping to build your score.
Each loan payment you make will be reported to all three credit bureaus each month, which will help build your credit history. Because 35% of your credit score is based on payment history, making on-time payments towards a CreditStrong account can improve your score.
2. Try Experian Boost
You already know that payment history makes up 35% of your credit score. Experian knows that, too. That’s why they launched Experian Boost earlier this year. This program allows you to include both your cell phone and utility payments in the calculation of your credit score.
Worried that you’ll miss a payment or two? Missed payments will typically harm your credit score, but Experian only counts the payments you’ve made on time. That means that any bill you don’t pay on time won’t harm your score. While you should try to pay your bills on time, this is a life-saver if you accidentally slip up on a payment or two.
3. Improve Your Credit with Rent Track
When you have a low credit score, any payment you continually make on time helps. RentTrack is a great rent reporting tool that will track your rent payments, therefore helping you build your score. RentTrack is often used by property management companies, letting their tenants pay rent online.
How does this help your credit score? When you pay your rent, RentTrack offers to report your payments to all three major credit bureaus. If you choose to do, every payment you make will show up on your credit report. Make your payments on time, and you’ll watch your credit score increase over time.