Explaining Your Credit Score
You probably want to know the precise details in terms of calculating your credit score. It actually takes a little while to finish it and it is done by three companies and they all have their own ways to come up with the results. Thus, a credit score from one company can come out different from the other. To have an estimate on your credit score on your own, take into consideration some of these factors.
If you don’t own a credit card, don’t have any type of bill in your name, or haven’t tried borrowing money, you basically have a zero credit score. Actually, it’s not considered as a bad credit, it will just be hard for you to get a loan if you have no credit at all. However, there are some lenders willing to run the risk and let you borrow albeit without credit. But generally, it’s always better to build up credit.
You credit history will make up around 35% of your credit score, so it is very crucial. If you have unpaid bills or debt that you were not able to repay, it will be listed in your name and it will take 7 to 10 years before it gets deleted.
Every little bad decision you make will ultimately affect you credit in the long run, of course, negatively. If you are trying to make up for unpaid debts, it will still apparently appear on your credit report as bills that were paid late.
The length of your credit history makes up for 15% of your total credit score. Thus, as soon as you can, start building up credit. It will improve over time just as long as you have your bank account maintained. Essential information such as length of employment as well as residency will also fall in to this category. Therefore, it is more ideal to be stable in life than always having to move around.
Furthermore, 30% will actually be based on your current debts. Even when you’re always on time with your payments, if you have multiple loans at a time, then you run the risk of being denied more credit. So always get only the loans that you badly need and be punctual in paying as you don’t only boost your credit rating, you also get to save a significant amount of money on interests. If you do so, it will show on your credit history so you’ll be given lower interest rates on your future loans.
10% of your credit score will depend on new accounts. They will check how many types of loans you have and how many you currently have open. Remember not to open or close any account abruptly as this can be detrimental to your credit rating.
Always be cautious and educated. Knowing things like how a credit score is being calculated can help you find errors if there is any. Get your free annual credit report and review meticulously to make sure your credit score is how it is supposed to be.
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Should I Raise A 700 Credit Score
Even though there are no universal guidelines in regards to what represents a very good credit score, look up on the Internet and you will see that quite a few creditors deem a 700 credit score as “very good” to “excellent.” In accordance with the creator of FICO scores, about 18% of Americans have ratings in the 700-749 range.
Such numbers are necessary since they display your creditworthiness at any given time. Credit scores are based on information in your credit reports. That said, they permit creditors to make instant credit decisions about you just by basing on it. The higher your score, the better the deal you are likely to be offered when you’re looking for some good credit deals.
Now that you have a 700 credit score, you ask if you should raise it. According to Fair Isaac Corporation, which provides this computation to the three main credit bureaus and majority of the creditors, around 40% American consumers have higher numbers than you do.
That is actually a worrying statistic. Research by this author shows that majority of creditors deem excellent credit as those that are above 725, while some are even above 750. These are individuals who are able to get the best terms and conditions of credit offerings.
Therefore, although your credit score may be deemed excellent by some of the creditors out there, if you are able to delay your credit purchase for even a few months, then you can wait as you raise your credit score. You must take into consideration the benefits of having your credit score raised, which includes having to pay a lower interest rate on your chosen loan. You must know that a lower interest rate on a home mortgage could lead to thousands of dollars in savings over the long haul and a reduction in interest rate will also lower your monthly payments.
Whatever you deem to be a good credit score could actually be not enough to get you the best credit terms. It pays to raise your grade if it is below 725 to 750, so rethink your decision about getting the loan you’re eyeing at the moment
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Categories: Credit Score Articles Tags: Credit, Credit Score, Credit Score Explanation
Why is it so hard to get your credit score?
Question by : Why is it so hard to get your credit score?
I can get my credit report but it does not actually have my credit “score” included on it. I asked three different people at the bank I deal with for my score but have been told that they can’t just give me MY score, but if I were to take out a loan application, (at a fee of course,) I could get it that way. I don’t want to take out a loan for a fee to get something that belongs to me to begin with. Finally, one teller who has known me for a while jotted it down on a piece of paper and slipped it to me with an additional note saying not to tell anyone that she gave it to me.
Why is it so hard to get your credit score? After all, it is YOUR credit score.
Best answer:
Answer by the_chief94
I have heard this frustration expressed before, the first thing that I always tell people is that the credit report is actually the important document for you to be familiar with and maintain the integrity of. As long as you know what is on your credit report is accurate you should be fine. You can also familiarize yourself with how your credit score is calculated. More information on that can be found all over the web.
Know better? Leave your own answer in the comments!
Categories: Credit Score Questions Tags: Credit Score, Credit Score Explanation
Six Credit Score Myths Debunked
Knowing your credit score is crucial. It’s a vital part of your financial life. It affects your credit interest rates, the amount you pay on car loans, and mortgages. It even has a say on whether you could land a specific job or not.
You have total control of your credit score. Its standing is actually up to you. Spare a few minutes of your time and watch this video and know the things you can do in order to take good care of your score.
Categories: Credit Score Videos Tags: Credit, Credit Score Explanation, Myths, Score
Credit Scores Explained
Among the many numbers that accompany us throughout life, our credit scores are one of the most important. The usual range of credit score varies from 350-800 while some model range up to 900. People with higher than 750 are able to attain best interest deals and insurance premiums while consequently, people having low scores get higher interests and higher premiums. In order to have your credit score improved, one must be able to understand what makes up the rating as a whole.
Many factors are considered but we can summarize them into five factors. First is payment history which constitutes 35% of the total score, this range from 6 months to 2 years of recent transactions. Secondly, the next factor is the debt to credit ratio which is 30% of the total score. This ratio factors in the total debt incurred against the total available credit in revolving credit lines. The next 15% is taken from credit history which is the amount of time that you have been using the credit system. The other 10% is based on the amount of credit you carry as well as the credit inquiries you make.
Having the improvement of your credit score in mind can greatly impact a person’s overall costs and can greatly impact a person’s monthly allowance. One important aspect and example is the mortgage loan. One might ask as to how high his credit score should be in order to have lenders approve a mortgage loan. Well the answer is most lenders use a credit score that is made by the FICO or Fair Isaac Corporation for them to make an assessment in your credit risk.
Anything below 620 is considered substandard while above 620 is considered good. But there is no assured set of numerical guarantees. The final decision depends mainly on the lender’s full decision on the matter. Lenders even consider one’s employment and salary as well as savings. People should also be aware that not all lenders use the FICO scale to make their lending choices and decisions. So it is possible that if you are denied in one lender, other lenders can cut you some slack.
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Categories: Credit Score Articles Tags: Credit Score Explanation, Credit Scores
Credit Score – What Makes a Credit Score
You may have heard about the good and the bad credit score, but let’s get back to basics. What is a credit score? Why is it so important?
Credit score is our weapon in getting approved for a loan, be it a big ticket item or mortgage. Boosting your credit back up is not only difficult, but it can get confusing at times as well.
Watch this video and learn a lot of the essentials about basically the most important aspect of your financial life.
Video Rating: 5 / 5
Categories: Credit Score Videos Tags: Credit Score Explanation, Factors
3 Important Credit Score Factors
The precise details about a credit score are not really made public. Credit scores take numerous factors into consideration.
Do you know what the 3 most essential credit score factors are? And those 3 factors make up 80% of your credit score already. Such factors are payment history, amount of money owed, and length of credit history.
Video Rating: 5 / 5
Categories: Credit Score Videos Tags: Credit, Credit Score Explanation, Factors, Score