Knowing
your personal Credit Score can really mean the difference between
being approved or denied for any kind of credit, credit card or any
kind of loan. In the majority cases, Credit Score means also a low or
high interest rate, you will be offered by bank or other financial
institution.
A
good credit score can help you qualify for an apartment rental and
even help you get utilities connected without a deposit.
So, this
is very important matter for you !
.If you would like to know more about Credit Score then, please go to our dedicated page about CREDIT SCORE, where you will find all detailed information..
.If you would like to know more about Credit Score then, please go to our dedicated page about CREDIT SCORE, where you will find all detailed information..
Knowing
your credit score and monitoring your credit report are crucial for
health of your personal finances and important aspects of good
personal financial planning.
The higher your credit score ,or FICO score, the more benefits you can participate in, such as being granted a loan with a lower interest rate. A lower credit score can result in higher interest rates on loans or loan denial, at all. |  |
Please read more about CREDIT REPORTS, here. Thank you.
What Is A Credit Score
In fact, your
credit score is a three-digit number generated by a mathematical
algorithm using information you provided, in your CREDIT REPORT. Credit score is designed to
predict risk, specifically, the possiblity that you will become
seriously delinquent on your credit and loan obligations, in the 24 months time after
scoring.
It seems that the FICO credit score dominates this market and likely around 90 percent of all financial institutions in the U.S.A., use FICO scores in their decision-making process.
It seems that the FICO credit score dominates this market and likely around 90 percent of all financial institutions in the U.S.A., use FICO scores in their decision-making process.
FICO scores range from 300 to 850, where a higher number
indicates lower risk. There are no any standard rules for considering
financial risk by lenders. Please consider below explanationa as a
informative description only. So, what is a good credit score in FICO
rating ? See below, please.
750+ EXCELLENT SCORE - The score of 720 or above means you are in a great financioal
and credit shape. Everything above 740 credit score represents an excellent credit
risk and an excellent credit history
700-749 VERY GOOD SCORE - Generally speaking, a score of 700 or more gets you the best
credit and fast loan approvals. Please be aware that credit score between 720-735
is average credit score in the USA.
650-699 FAIR (or HIGH GOOD) SCORE - Generally, a score of 650 or above is a sign of
very good credit, and a very good credit score
620-650 GOOD SCORE - In fact, credit scores in the range of 620-650 indicate basically
good credit and very often the minimum for term “good credit score”.
600-620 POOR SCORE - Please be aware that score 620 is considered the dividing
line between good and bad credit. Lenders commonly view customers with credit
scores from 600 to 620 to be a much higher financial risk.
600-550 BAD SCORE - Scores below 600 indicate relatively high risk and may result in
credit denial or very high interest rates. If the borrower has credit score less than
600 he is generalized as a person which having some credit problems.
Below 550 Everything below 550 is considered very risky and sopmetimes considered as
"horrible" credit, with a lot of bankruptcies, credit defaults, trial against, etc.
The three major credit bureaus, Equifax, Experian and
TransUnion, use several factors to determine your credit score,
including your amount of total debt and the number of credit cards you
own. However, Experian credit bureau ended its agreement with
myFICO.com in 2009. Consumers currently have access to only their Equifax
and TransUnion FICO scores
Elements Of Credit Score
All information you provided in your credit report goes into five major categories that make up a
FICO score.
Some factors weights more heavily, some weight less, like types of credit used. Please take a look at the elements of credit score, to understand which credit score factors are most important. |  |
- PAYMENT HISTORY (35 percent) - Your account payment information, including any delinquencies and public records.
- AMOUNTS OWED (30 percent) - Means, how much you owe on your accounts. You should be aware that, the amount of available credit you are using on revolving accounts is heavily weighted.
- LENGHT OF CREDIT HISTORY (15 percent) - It says, how long ago you have got opened accounts and time since account activity.
- TYPES OF CREDIT USED (10 percent) - The mix of accounts you have got.
- NEW CREDIT (10 percent) - Credit inquiries and number of recently opened accounts.
Other information like address, age, marital status, race, income, employment and other personal and demographic information, do not affect the score.
You CAN Improve Your Credit Score
