The Benefits of Having a Great FICO (Credit) Score

The Benefits of Having a Great FICO (Credit) Score

-------------------------------------

Why the FICO Score matters

FICO Score is another name for Credit Score. FICO used to be the abbreviated name of the firm the Fair Isaac Company. This firm focused on consumer credit history and other factors important to lenders.

The FICO score is calculated from many different variables including past payment history, length of credit history and even credit applications themselves. Without a good score, you will find securing a loan nearly impossible. This is because the FICO score is universally used to assess how much of a risk a consumer will be to a lender.

FICO scores are expressed in 5 different ranges:

  • 500-559:
    if your score falls in this range you will most likely not obtain any funding, and your first priority should be repairing your credit score.
  • 560-619:
    obtaining funding will be difficult, and any funding you get you will be met with much higher interest rates.
  • 620-674:
    the range right in between the suitable credit line and the poor credit line, you will find it difficult to get great terms on a loan.
  • 675-699:
    what most consider to be a suitable credit score. You should be able to get a loan, but the terms won’t be as good as they would be in a higher credit score range.
  • 700-719:
    this score will allow you to easily get financing with the capability of getting good terms and conditions on mortgages.
  • 720-850:
    the maximum credit score range. Getting home loans and car loans will be simple, and you will benefit from the best interest rates and terms.

Not everything will stay on your credit report forever. 7 years after an item is reported to the credit bureaus it will most likely have fallen off your report. The smart thing to do here is to let this process happen and to not contact the creditor again if an item is over 7 years old.

You can check who you owe and how much you owe them by visiting one of the many credit score websites. These sites will also give you suggestions for improving your credit score.

How to improve your Credit Score

ficorance

The benefits of improving your credit score are clear with better interest rates and more opportunity to borrow. This is why many credit repair services have sprung up to meet this need.

A credit repair service understands all of the rules in the process of improving credit and therefore they can help you save money in every way possible. There is no magic formula, but a credit repair service provider may help you greatly in saving money while improving your score.

One key responsibility they carry out is to remove credit reporting mistakes. If you suspect a lot of mistakes in reporting on your credit report, it is wise to get in touch with a credit repair service.

Image credits:
FICO Score by Simon Cunningham, on Flickr,
FICO credit score by Sun Wayne, on Flickr

-------------------------------------------------------------------------------------------------------------

end of post idea

-------------------------------------------------------------------------------------------------------------

Helpful article? Leave us a quick comment below.
And please give this article a rating and/or share it within your social networks.

Write a Comment

Your e-mail address will not be published.
Required fields are marked*

Time limit is exhausted. Please reload CAPTCHA.