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Credit Score - Reporting Your Financial Health
Credit score is one of the most basic, determining factor
while loan borrowing. Credit score is the criterion for the
creditor to ascertain whether to give you credit or not. Credit
score is a powerful tool, if you what it is. Credit score is a
three digit number which is consequential enough to decide
whether you can own a house or a car and has considerable
influence on how much your pay on your credit, insurance and
other necessities of life.
Credit score isn't just any random number. Credit score is
calculated by a mathematical equation based on a statistical
system which awards points based on the information on the credit
report.
Credit score can lay open all the info about your accounts,
loans, credit limits, balances and payment history. Any
information about your public records like bankruptcies,
foreclosure and court judgments are also revealed. There will
also be a list of people who have made inquiry about your credit
report. This information comes from reliable sources like
lenders, banks and retailers.
Credit score is affected by payment history. A record of late
payments on current or past history will lower your credit score.
A lot of debt can lower your credit score especially if you are
approaching your credit limit. Length of credit history has its
own influence on credit score. A longer credit history is better.
Opening multiple accounts in a short period of time can have a
negative effect on your credit score. Too many inquiries can be
interpreted negatively. Creditors can assume that you have been
looking for credit from numerous agencies. Also, existence of too
many open accounts can lower your credit score whether they are
being used or not.
The three major credit reporting agencies are Equifax,
Experian and Trans Union. Interestingly, you can have three
different score for each agency if the data used by them is
different. Therefore, it makes sense to check your credit report
and credit score once or twice a year. In case there is any
missed information or incorrect information, you can ask these
bureaus to correct it. This way your credit score will carry the
best and the most accurate information available.
Fair Isaac Company created the Beacon FICO score which is the
most commonly used score. The beacon fico credit score rating
range form 350 to 850, 850 being the best. Below 600 would mean
bad credit and more in terms of interest rate or even the
possibility of refused credit.
Today, 62% of consumers do not realize what credit score can
do for them. Credit score matters. It estimates for the lender
whether you will pay off the loan and whether you will pay it off
in time. Credit score is decisive while determining how much you
will be charged for the loan. Loan lender will have the final say
with regard to providing you with a loan or not. However, loan
lender will be paying attention on various other factors also
like equity, job history, income, savings, and the type of loan
you want - before making a final decision.
Credit score can expose what you can
achieve or not in terms of finances and what debt choice to make.
Knowing your credit score would undoubtedly prevent you from
deceit at the hand of the loan lender. Strive to improve your
credit score. A higher credit score will make you eligible for a
number of favourable finance options.
With credit score there is always a room for improvement, even
if you have a good score. However, there are no quick fix
solutions to improve credit score. However, over a certain time
period you can certainly improve your credit score. If you have
been unable to pay your payments due to illness, unemployment or
personal issues - a short explanation to credit reporting
agencies about the circumstances can do wonders.
Credit score is the guide to financial health. You can learn a
lot from it. It can give you a direction to move on. So, where to
start from when hunting for credit? - CREDIT SCORE.
Amanda Thompson holds a Bachelor's degree in Commerce from
CPIT and has completed her master's in Business Administration
from IGNOU. She is as cautious about her finances as any person
reading this is. She is working as financial consultant for
chanceforloans .To find a Personal loans,bad credit loans,Debt
consolidation,home equity loans at cheap rates that best suits
your needs visit http://www.chanceforloans.co.uk
MORE RESOURCES:
MORE COLLEGE CREDITChicago Sun-Times, United States - 11 hours agoDespite the current nationwide credit crunch, the State of Illinois secured $100 million for the student loans by tapping a new source -- credit unions. ... |
Credit repair is a DIY projectBaltimore Sun, United States - 2 minutes agoBy Gail MarksJarvis | chicago tribune Mike Ferrara wants to buy a house in a few months and is worried that mistakes on his credit report will keep him from ... |
Ask, and you might receive a lower credit-card rateSeattle Times, United States - 19 minutes agoPick up the phone, look at the latest credit-card offers and keep repeating this: The bank needs me more than I need it. By Susan Tompor Pick up the phone, ... |
Credit - Google News
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