What is Your Credit Score?
Your Credit Score is one of the most important numbers in your life. This score is a number between 300 and 850 and is also known as a FICO credit score. FICO stands for for Fair Isaac Company. Fair Isaac got together with 3 credit reporting agencies, Experian, Equifax and Trans Union in the early 1980s and created this credit reporting score.
Each company uses somewhat different factors to determine your score, but a 700 from Equifax is equivalent to the same score from Trans Union.
These agencies look at your current debts, loans, and financial obligations, and then create your credit profile. They then take this credit profile and compare it to others in similar circumstances and they give you a rank based on those peoples’ past credit history and how likely they were to pay their debts. Your score is the supposed to represent how likely you are to repay your debts.
Companies and lenders have their own method for using credit score to issue you credit or services. Normally a person with a score of 650 and above has good credit. The 620-650 range, is considered average credit scores. People in the category, 620 and below, can still get credit, but the with higher finance charges and terms.
You are entitled to get a free credit report from each of the three companies yearly.
The information in your reports can help you located resolve any errors in the report. Many people get denied credit based on low FICO scores, to find out old information or loans are still outstanding.
It is fairly simple for a company to put negative information on your credit report. If there is incorrect information reported against you, you have the right to remove it.
You can either try calling the company directly to resolve it or write a formal letter.. When you dispute information a company has just 30 days to respond or they must remove it.. Many times a letter writing campaign to your creditors can work wonders on your credit score.
Your Credit Score is one of the most important numbers in your life.. The higher your score, the lower interest loans you will qualify for potentially saving you many 1000’s of dollars in interest throughout your lifre.
Credit why do we need it? Without a credit rating life can be impossible. A millionaire friend of mine, said to me, ‘you are only as good as your credit rating, it easier to borrow one million dollars than to borrow ten bucks. How do you make that out I asked my friend, well he said, if you need to borrow ten bucks son you are in a bad way. The motto of the story never borrow small amounts of money and always listen to the advice of millionaires, Michael Nicolson The rockyboy2 man, author of the best selling book rockyboy2 The Quest for The Million