Whenever you apply for an auto loan, mortgage, credit card, or personal credit line, the bank or lender that you are dealing with will make use of your credit history to determine credit limits and interest rates. Your FICO score, colloquially (and mistakenly) referred to as FICA credit score, is the credit gauge that they will use. Being informed about your credit report, how scoring works, and how credit companies will use the information, can be very helpful in your financial decisions.
Your credit report includes the following information:
1. Personal profile. Names, aka’s, current and past addresses, DOB, and employment history.
2. Credit summary. This is a listing of the accounts you hold that are either installment or revolving accounts.
3. Public records. For example, bankruptcies, tax liens, overdue child support, etc. These records remain on a report for 7 to 10 years.
4. Credit inquiries. Who has requested to see your report and how often.
5. Account history. The details of your open and closed accounts.
6. Credit score. A debt to income ratio on your payment history and number of open accounts.
Usually, it costs $9.00 to order your credit report. Recently, an amendment to the federal Fair Credit Reporting Act (FCRA) allows you one free FICA credit score and report every 12 months (www.annualcreditreport.com). Otherwise, order your report from a reputable source like Equifax, Experian, or Trans Union.
What’s a good credit score?
Credit score ranges lie from 300 to 850. FICA credit scores of 750 and above are considered excellent. Even 720 will usually bring you good intrest rates and credit lines. From 680 is “very good,” 620 is “good,” 580 “above satisfactory,” 550 “satisfactory,” and 480 “below satisfactory. The Fair Isaac Corporation (inventors of FICO score) reports the percentages of where the American public falls on a credit score chart. Most people have credit scores between 600 and 800. Only 1% of the population holds a low credit score of 499 or less. 11% hold a perfect credit score of 800 (it is possible!). You can see such charts, as well as diagrams describing how much different factors affect your credit are available at various sites around the internet.
It is important to order your credit report once in a while, or especially before applying for a significant loan or mortgage, in order to confirm that your report is actually correct. Don’t make credit inquiries too often, however, as that can negatively impact your score as well. Realize that mistakes on your report can greatly affect loans and credit lines your are granted. This is another reason that you want to be sure that any company you borrow from will consistently report your on time payments; this is how your credit score can improve.
Your credit report includes the following information:
1. Personal profile. Names, aka’s, current and past addresses, DOB, and employment history.
2. Credit summary. This is a listing of the accounts you hold that are either installment or revolving accounts.
3. Public records. For example, bankruptcies, tax liens, overdue child support, etc. These records remain on a report for 7 to 10 years.
4. Credit inquiries. Who has requested to see your report and how often.
5. Account history. The details of your open and closed accounts.
6. Credit score. A debt to income ratio on your payment history and number of open accounts.
Usually, it costs $9.00 to order your credit report. Recently, an amendment to the federal Fair Credit Reporting Act (FCRA) allows you one free FICA credit score and report every 12 months (www.annualcreditreport.com). Otherwise, order your report from a reputable source like Equifax, Experian, or Trans Union.
What’s a good credit score?
Credit score ranges lie from 300 to 850. FICA credit scores of 750 and above are considered excellent. Even 720 will usually bring you good intrest rates and credit lines. From 680 is “very good,” 620 is “good,” 580 “above satisfactory,” 550 “satisfactory,” and 480 “below satisfactory. The Fair Isaac Corporation (inventors of FICO score) reports the percentages of where the American public falls on a credit score chart. Most people have credit scores between 600 and 800. Only 1% of the population holds a low credit score of 499 or less. 11% hold a perfect credit score of 800 (it is possible!). You can see such charts, as well as diagrams describing how much different factors affect your credit are available at various sites around the internet.
It is important to order your credit report once in a while, or especially before applying for a significant loan or mortgage, in order to confirm that your report is actually correct. Don’t make credit inquiries too often, however, as that can negatively impact your score as well. Realize that mistakes on your report can greatly affect loans and credit lines your are granted. This is another reason that you want to be sure that any company you borrow from will consistently report your on time payments; this is how your credit score can improve.
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