What your mail says about your credit score

Once upon a time, letter carriers delivered, well, letters. You could expect cards from Grandma with $5 bills or handwritten notes from friends just saying hi. Much of that communication takes place over email now (except Grandma's dollars, if you're lucky).

Today, your mailbox has become the destination of bills, solicitations and, on a bad day, warnings--often related to how you spend money. What you find in your mail says a lot about the state of your spending and the state of your credit score. Here's how to decode what your mail says about your credit.

You receive: The best credit card deals

What it means: Banks love your credit score

For a while it looked like the Credit Card Accountability, Responsibility and Disclosure (CARD) Act of 2009--legislation that put restrictions on some credit card companies' practices--permanently slowed the number of credit card offers sent to prospective customers. But banks appear to be getting their mojo back. From the fourth quarter of 2009 to the same period in 2010, mailed solicitations for new credit cards increased from 551 million to 1.4 billion, according to direct marketing research firm Mintel Comperemedia.

Andrew Davidson, senior vice president with the company, notes that the best credit card offers are still going to the most creditworthy. So, if you're receiving many offers, you may take that as a good measure of your credit score.

Consider using your position as leverage, advises Lynnette Khalfani-Cox, author of "Perfect Credit: 7 Steps to a Great Credit Rating" and founder of the financial blog AskTheMoneyCoach.com. With other offers in hand, she says, "you're better positioned to negotiate for a lower interest rate from an existing card or new card company. You are in a better position to ask for a waiver of fees or to shift your payment due date."  Access to the best credit cards for high credit scores can potentially save you thousands in interest or allow you to earn elite perks and benefits.

You receive: No offers

What it means: You may be a credit risk

While Davidson notes that subprime borrowers are beginning to see offers again, "it's the really early days" of that increase in volume. So, if offers aren't coming your way, you may be less appealing to the banks as a result of a lower credit score and history.

What are you missing out on by being a borrower with fair or bad credit? The benefits of increased competition. Davidson points out, "It's ironic that, in light of the CARD Act, you've got arguably some of the best offers: cards with rewards, features, benefits such as low introductory rate offers for longer periods."

Boost your credit score by following healthy borrowing habits, and you'll be in a position to take advantage of the best rewards credit cards and other perks.

You receive: Late notices and warnings

What it means: Check your habits… and your card balances

If you dread the walk to the mailbox, you could be dealing with a couple of issues: disorganization that's leading you to miss bill payments, problems related to overspending, or both.

If the problem is lack of organization, technology may be the solution. Khalfani-Cox advises automating your finances as much as possible. "It's so much faster, easier and more convenient. Have your bills paid on automated schedules, have payroll automatically deposit your check into your checking or savings account. It reduces the human error factor to a manageable amount."

If the problem is overspending, though, the fix may not be so painless. It may be time to take a hard line: Start living off a written budget, change your shopping habits and get your situation under control.

You receive: Nothing

What it means: Investigate missing mail

Did you move in the last few months? Magazine and other companies may send their mail without forwarding service, even if you registered a new address with the U.S. Postal Service. A few missed magazines may not be a big deal; usually customer-service agents will extend your subscription if you place a contrite phone call. However, missed credit card bills and bank statements could lead to surprise charges--and wrecked credit scores.

If you moved recently, check your online bank statements and credit card statements to see when you last made payments and if any fees have accrued. If you're planning a move, taking the time to update the address on file with all your financial service companies (banks, credit cards, investments) is worth the trouble. It's up to you if you feel the same way about your subscription to Allure or Field & Stream.

You receive: Catalogs galore

What it means: Examine your shopping habits

If every catalog, flier and postcard that shows up makes you run for your credit card, it may be time for self-exploration. Sephora or L.L. Bean may have you on their "greatest hits" lists for a reason: your open wallet. Loyalty to stores and businesses in itself isn't a bad thing, but if the coupons and deals in the mail tempt you to spend more than you intended, it may be time to return to sender.

You receive: Too much unwanted mail

What it means: You should opt out

If regular sale and credit offers are the source of unchecked spending, or if unwanted mail annoys you, consider getting your name removed from the mailing lists that generate it. "When I work with people," Khalfani-Cox says, "I tell them that step one is 'opt out.' You don't need that extra temptation."

The Federal Trade Commission provides information on opting out of both general marketing mailings as well as preapproved card offers.

We may never return to the good old days when your mailbox was full of chatty letters and love notes from actual people, but you can ensure that your mail is what it's supposed to be: messages and packages you want and need (especially that $5 from Grandma).

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