Why is good credit helpful as a comedian?
Because it helps make your life easier. If you want to rent a car, if you want to rent a room, and endless other reasons that on the road you could benefit from having good credit. Having good credit as a comedian is nearly a laughable subject. Mostly because comedians typically have awful credit. Let’s explore some reasons why.
1.) Not enough income
- This one is a given. We don’t make as much money as other folks think. More so, we have more expenses that eat into that income than most people who work a regular 40 hour job.
2.) Poor Credit Decisions
- This is not related to late payment but to poor choices in securing credit that is not needed, like store credit cards with unrealistic interest rates or personal loans for things that are luxuries not necessities.
3.) Unexpected Debt
- This is a super common one. This is medical bills and other financed and billed items of debt. Other examples include court settlements and home repairs.
4.) Bill Indifference
- When you finally just stop caring. This one is common for mobile phone bills and other utilities that go unpaid. People that end up with their services turned off for non-payment seem to care less about trying to make good on their debt.
Fixing your credit is a LONG PROCESS most of the time. It requires dedication and persistence. Occasionally it is pretty simple and just requires a few disputes and it is resolved, but that is for those that have kept their credit in good shape in the beginning.
What is your FICO Score?
First things first, we need a credit report that includes a FICO score so we can find out where to begin. A FICO score is your value to lenders as determined by a financial calculation created by the FICO company in 1989. FICO was adopted by Experian, Equifax, and TransUnion (The three credit reporting agencies). How do you get your credit score for free without falling into some type of subscription service trap? Use CreditKarma.com (They do not pay me for endorsing them, I just used them and they worked great for no cost.)
Pull a full credit report
You will also need to pull a full credit report, this is also free once each year through Experian, Transunion and Equifax. Once you have done that you are ready to attack your credit improvement situation.
Where to begin
Find the reasons your credit is bad. Examples of items that hurt your credit score and written off debt, late payments on current accounts and insufficient credit history. First, tackle debt. Credit cards and medical bills are typical negative items you will see on credit report as unpaid debt or debt with bad payment history. You will also see misattributed or completely false debt. What? You mean other folks debt can be put on my credit report? Sure, collection agencies are lazy and often complete criminals. They do a host of things such as falsely report bad credit on unsuspecting peoples accounts. The government has regulations put in place to keep this to a minimum but it still commonly happens. So first things first, deal with the debt you didn’t create.
The Dispute Process
Like I said, sometimes you will see stuff on your credit you never did or participated in. You must go to Transunion, Equifax and Experion and file a dispute on the erroneous items on your credit report. Now comes the hard part, unrelenting persistence. You HAVE to follow-up with each agency to find out if the item has been removed or what the result of the dispute was. This takes time, sometimes as much as 90 days from the time you file. This is why I say it sometimes takes YEARS to improve your credit substantially. All three credit reporting agencies now have a dispute process you can do online. Here are links to all three (Experian: Equifax: Trans Union)
Building GOOD Credit
Unfortunately according to the way the credit reporting agencies work you really HAVE to posses some type of revolving credit that has a low but existent balance in order to improve your credit rating. They want to know you are an active participant in credit to see what your current payment history is like. Most of you that have bad credit will not qualify for a credit card or similar credit account, therefore it seems you can’t do anything about this part. Here are a few companies listed by CNN Money that allow you to start rebuilding your credit. http://money.cnn.com/galleries/2011/pf/1104/gallery.best_credit_cards_bad_credit/ Once you get one of these cards, use it wisely and responsibly and it will get reported to your credit that you are maintaining an open credit line with good payment history that is not maxed out.
How Long is This Going to Take?
It’s not quick. None of it is. I would say it will take at least two years to get your credit up to where it should be in order to do things like get a car loan of buy a house. The benefits of doing this will be never-ending however. Keep track of your credit and keep improving it. One day you will thank yourself for it. Now back to writing jokes..