Fico Credit Score
FICO has become a famous term in reference to credit scores. The two creators could hardly imagine how famous they would be when Bill Fair and Earl Isaac founded the company in 1956. Officially named the Fair Isaac and Company, it is famous for the development of software to help companies determine risk.
Many people attact strange ideas to their credit scores. I imagine an entire industry could tackle the psychological issues involved with credit scores and the way people think.
Millions of Americans have low credit scores and millions use subprime credit cards. Their bad credit, usually considered to be below 600, is only an indication of the risk they pose to lenders. This risk is based on past use and performance of their financial life.
Credit scores do not take into consideration the type of person you are. Likewise, it makes no difference what your gender may be. Height, weight, income and marital status make no difference when calculating your FICO Credit Score.
What matters is how much credit you have, the type of credit you have and how you pay your bills. There are other factors, but these three categories are the main criteria for determining what your score will be.
What type of credit do you have?
Department stores, and auto loans plus a mortgage are all acceptable types of credit. The problem lenders are the high risk types, like Payday loans. American General and other high interest rate lenders will cause your scores to go down too. Stay away from jewelry store financing. Furniture is another type of financing that will cause your credit scores to go down.
How do you pay your bills?
Believe it or not there are people who will wait till the last minute to pay their credit card bills. They do this with the attitude that the lender is going to have to wait till the bill is actually due. I've even heard it muttered that they're not getting my money sooner than the due date. If you are one of these people, I have bad news for you.
Credit card debt is calculated with interest due on the remaining balance on a daily basis. Everyday you owe money you are paying interest. Also, your balance is changing-going up, so why wait to pay your bills? If you have the money, pay early. And besides, it is not your money. You borrowed it. Remember?
Many people attact strange ideas to their credit scores. I imagine an entire industry could tackle the psychological issues involved with credit scores and the way people think.
Millions of Americans have low credit scores and millions use subprime credit cards. Their bad credit, usually considered to be below 600, is only an indication of the risk they pose to lenders. This risk is based on past use and performance of their financial life.
Credit scores do not take into consideration the type of person you are. Likewise, it makes no difference what your gender may be. Height, weight, income and marital status make no difference when calculating your FICO Credit Score.
What matters is how much credit you have, the type of credit you have and how you pay your bills. There are other factors, but these three categories are the main criteria for determining what your score will be.
What type of credit do you have?
Department stores, and auto loans plus a mortgage are all acceptable types of credit. The problem lenders are the high risk types, like Payday loans. American General and other high interest rate lenders will cause your scores to go down too. Stay away from jewelry store financing. Furniture is another type of financing that will cause your credit scores to go down.
How do you pay your bills?
Believe it or not there are people who will wait till the last minute to pay their credit card bills. They do this with the attitude that the lender is going to have to wait till the bill is actually due. I've even heard it muttered that they're not getting my money sooner than the due date. If you are one of these people, I have bad news for you.
Credit card debt is calculated with interest due on the remaining balance on a daily basis. Everyday you owe money you are paying interest. Also, your balance is changing-going up, so why wait to pay your bills? If you have the money, pay early. And besides, it is not your money. You borrowed it. Remember?
