All About My FICO Score
by: RichardLakin |
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It is a complete waste of your time to find out your credit score rating if you don't take the time to understand it. You cannot succeed in today's credit based financial market unless you understand how to improve your credit score. Your credit score is derived from the combination of money and credit-related choices you make.
When you take a look at your credit FICO report score, you will see that things like your use of a secured bank card or a portable mortgage will impact how the generic scoring models calculate your score. Both positively and negatively, the things you do can impact your credit report FICO score and Experian FICO score for a long time.
Credit Cards and My FICO Score
Credit cards can really affect your FICO score. Using your credit cards frivolously will result in horrible credit scores with all three companies. Credit cards hugely influence the FICO Experian score as well as on the other credit bureau scores.
Since credit cards require monthly payments, they are a good indicator of your credit worthiness and FICO score. The payments will usually be small for most consumers, but they must be paid on time.
With that in mind, consumers have a chance to positive impact their FICO free score with their credit card use. When consumers come in and ask "how to raise my credit score", the majority of credit repair clinics will tell them that getting a small credit card and paying the balance each month is a great way of fixing credit score problems.
But consequently, lines of credit can cause consumers problems, too. You will not believe how many people say that credit cards have ruined their FICO score. Any late or neglected payments will cause your score to drop.
When checking my credit score online, I might possibly discover that it is quite a bit lower than it should be due to a few payments that I missed some time ago. The volume of your credit that is actual credit cards is important.
If you obtain too many charged cards (more than three), lenders will see you as a bad candidate for credit. Instead, it is better to have only two cards and use them cautiously.
Loans and My FICO Score
There are lots of different loan types, and each of them impacts your 3 bureau credit score in a different way. If you want to raise FICO score for all of the credit reporting agencies, then you absolutely must keep your loans in good standing. For the most part, student loans and mortgage loans are stable credit types than show your strength of credit to the creditors. If you are able to effectively manage and pay these two types of loans, then your credit bureau data will create a favorable impression for future lenders.
On the flip side, the size of the loan is notable consideration. Generally, mortgages are big loans. Your credit score will be greatly impacted, in a very negative way, if you fall behind on one of these or go through voluntary repossession. My FICO score is good due to having a mortgage, but if I were to default on the mortgage, I'd be scared to see how much my FICO was lowered. Also, keeping records of personal loans in the same way that one keeps for credit cards is a smart way for customers to keep up with what is going on. Your FICO score will plummet if you lose track of your unstable loans.
My FICO Score Can Be Altered By Credit Inquires
Many people don't know that each time they apply for a credit card or a loan; it will appear on their credit report. My FICO score will be impacted because I filled out the paper work, regardless of the result of the credit inquiry. For this reason I do not take advantage of freebie offers that are dependent upon applying for a credit card. When you ask for too many credit cards or loans, the lenders will infer that you are unstable, and your FICO score will drop.
One of the worst things for your credit score is to be turned down for credit. You will find your credit score going down by 20 points if you establish a habit of being repeatedly turned down for loans and credit.
My FICO Score and Credit Balances
It is not good to use up all of the credit on your credit cards. As a general rule, if you are using more than 50% of the available credit on a card, then your score will take a dip. This is especially true for larger cards, where those balances are even more substantial. Card credit FICO score consequences are serious, and they are often overlooked.
Having a little outstanding each month on a credit card is a good thing since it helps in maintaining a favorable re-payment history. Your risk is extremely high when you use all of your available credit. This is what a FICO score is made for. Lenders use this to evaluate your risk, and then they can make the best decision.
The Serious Stuff
While missing payments and having high balances will impact your credit score some, nothing will hit it harder than serious things like tax delinquencies, bankruptcy score filings, repossession of your property, or a serious loan default. If you are forced to go through bankruptcy, then you can expect that the next time you use a FICO calculator, your score will be in a very low place.
Bankruptcy causes a lower FICO score, usually 500-600, and makes it difficult to get a loan. Credit repair companies can help you understand your options if your credit has been impacted by one of these serious circumstances.
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About the Author
Be aware of the serious factors that affect the outcome of your FICO score. Let us help you decide by understanding the details in MyFico score before seeking to hire a credit firm.
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