Know More About Credit Score Your credit score is a valuable asset in modern times. Affects their financial life of the whole way. The more you know about it, the more you can achieve financial success. Very few people know exactly how it is calculated. Here are some interesting facts for you #
Why is called FICO Your credit score is based on data collected and analyzed by a company called Fair Isaac Corporation. That's why it is called FICO score.
What is its importance The score tells creditors to the extent of risk that is going to take if they lend money. If you have a high score, lenders are comfortable paying more money. But if you have a lower, it is assumed that the chances of recovering their money are less. Then, can face harsh conditions, like higher interest rate or shorter repayment periods.
The score is divided into five parts Various aspects of their financial data are the total credit score. You the repayment history, credit currently enjoyed by you, and the length of your credit history, things like this come to your credit score.
= Your payment history Your Potential creditors want to know if you pay your bills on time or not. This is a very important factor for any creditor and 35 per cent of the score is based on this factor. Even if you are regular in paying their utility bills, which will be reflected in your score. = The ratio of available credit Your use of funds available will show the amount of "needy", while you're applying for a loan. If you have used their credit cards as possible, reach your score badly. This is taken as a sign of the weak financial position. The 30 percent of your score is based on this relationship. = Length of credit history If you are enjoying credit for a long time without any payment problems, you're a good customer. The 15 percent of your score is formed by this factor. Therefore, it is advisable to stick to credit cards has come a long time, even in her student life! = Her expectation of credit the amount by which you are applying for credit will also be a factor. 10 percent of your score is formed on this basis. While applying for a mortgage large, all other debts, shall be considered to see if you are a credit risk. Once you get that mortgage, your score will drop immediately as a consequence.
= Type of credit used by you credit after all debt is considered, but there are degrees of credit. If you have little or no interest credit card, which is considered good credit. If you are paying a good percentage of their loan principle with regularity, it counts as a good sign that you are making quick return. The final 10 percent of your credit score is calculated on this factor. #
There are some strange things that affect your credit score. For example, if you are late in paying their assessments of library, this can be reported on your credit report and immediately lower your credit score! You may lose the payment of a bill from your doctor on the assumption that insurance coverage will take care of it and reach your score! You must be very careful with those unpaid bills by accident and must diligently to resolve them.
The number of credit cards have also affect your credit score. Many people are simply addicted to the collection of credit cards more and more like a hobby! This practice can be more costly for them since they can obtain more severe conditions.
Determine their potential lenders based on your credit score if you are an eligible customer not for them. So it's important that you protect it from all these difficulties. It's like your baby and need more care to see that gets bigger and healthier. Credit report is the key word in today's lifestyle. You have to take care of it, keep it healthy and growing. What factors make it weak? How do I avoid them? Chintamani Abhyankar provides advice designed to develop a good credit rating. Free Credit Consultation Certified Credit Consultant