What Is a FICO Credit Score?
August 19, 2010 by Credit Attack
Filed under credit card services
In the late 1950’s, a company named Fair Isaac & Co. came up with the idea that the best way for lenders to be able to judge a person’s reliability and trustworthiness to pay back money that is borrowed was to compile all the information about that person’s credit history into a number. If your credit is good, you will have a high number, and if your credit is low, you will have a low number.
Your credit score is calculated by using mathematical tables and score models. Each part of your credit history is assigned a number. The points will have high numbers if they are good references and the bad ones will have low.
Three credit bureaus will have your mathematically computed credit score:
• Trans Union
• Equifax
• Esperian
If you want to get a free copy of your credit report, go online and request one. You may have to pay a small fee to obtain the FICO score, which lenders use the most in determining whether or not you are worthy of borrowing money from them.
When lenders evaluate you by your credit history and will look for certain pertinent parts about your credit history that determines whether or not you can be trusted to make the payments in the loan you are asking for.
These are a few of the things that will be looked at to determine your credit score:
• How long it took you to establish credit is one thing that is examined in determining your credit score.
• How many times you have been late in making your payments.
• You need to have more credit available on a credit card than balance that owes.
• How long you have lived at your residence will count a lot. It will prove if you are a stable person or not.
• Lenders will look at how much debt you owe and will go from there determining how many other bankruptcies you may have, collections and the like.
If you want to try to improve your score, you can, but it may take some time. Pay your bills when they are due, lower your credit card balances, and don’t go wild applying for credit card because having too many applications can ruin your score. If you hardly any credit and this is the cause of your low credit score, you need to apply for a couple of credit cards or get one card and carry a small balance on it each month and pay it off when due.
