Get Free Credit Score – FICO Report

Alison Cole asked:




Since FICO scores places a value of the types of accounts that an individual holds and also the individual?s credit history, those who have declared bankruptcy may have really low FICO scores. FICO scores are used by most finance institutions as a basis for credit or loan approval. One’s creditworthiness may be measured through FICO scores.

The FICO scoring scale runs from 300 to 850 and most people have scores that range between 600 and 800. Those with scores of 720 or higher are more favored to acquire loans with reasonable interests on mortgages as supported by a number of finance data. Those whose FICO scores are below 620 are subject to a much tedious process of reviewing prior to credit approval. Those who have declared bankruptcy usually get FICO scores lower than 600, which makes it quite hard for those who have declared bankruptcy to acquire credit.

When one considers how FICO scores are calculated, several factors which are also elements that one takes into account when declaring bankruptcy are quite similar. One?s payment history or his ability to pay his dues on time is one of the key factors that credit managers consider when calculating for FICO scores. One’s frequent inability to pay on time is one of the precursors which may (although not always) lead to bankruptcy. Bankruptcy may be characterized by having more debt that the credit limit. This is also one of the considerations that is considered by FICO scores. One?s credit history , the types of credit that the individual uses and even the number pf inquiries that the individual has regarding credit are also considered when computing for one?s FICO scores in the same way that these are considered by those who declare bankruptcy.

Bruce

Jennifer Bailey asked:




If you are in the process of getting a house and are planning to get either a fixed rate or interest only mortgage, the mortgage rate that you pay would go a certain length to help you decide. There are three main elements that effect you mortgage rate including the Federal Reserve Discount Interest Rate, your FICO Score and credit report, and lender business factors.

How does the Federal Reserve Discount Interest Rate affect you? Banks and other lending institutions borrow money from the Federal Reserve Banks at a “discount rate” that is set by the Federal Reserve Banks. This rate directly affects the “Prime Interest Rate” that the bank charges you. You will typically pay a rate based on prime, plus certain amount of interest. This will depend on the lender’s policy on consumer mortgages.

A FICO score is a scoring method that determines the credit worthiness of a particular credit user. In simple words, the FICO Score let’s the lenders assess how capable you are of paying off your credit. The FICO score will be arrived at after looking into the status and number of credit cards, balances owed, mortgage, installment loans, late payments, delinquencies, and bankruptcies. Potential lenders will get your credit report from a credit bureau.

You can achieve and maintain a good FICO score by paying all your bills on time, not applying for credit too frequently, and reducing your credit card balance. Check your credit information from time to time and ensure any false or outdated information is corrected. And don’t let companies do a credit check on you unless you are ready to buy because too many requests for a credit report can actually drive your FICO score down.

Lender business factors are the issues where your ability to be a smart shopper can make a real difference. While banks and other lenders are in business to make a profit, they also exist in a competitive market, which means that you can get a better price with a bit of research and negotiation.

Always check out at least three lenders. Each lender will have unique guidelines for how they write loans, and one lender’s guidelines could be more favorable to you than another.

Douglas

Jeanette Joy Fisher asked:




Perhaps you’re familiar with the FICO scoring system used by credit companies to determine a potential client’s creditworthiness. But do you know how that score is determined?

First, let’s define the acronym FICO. It is used to describe a system developed by the Fair Isaac Company for one of the Big Three credit reporting companies, Experian. Since its inception, FICO has gone on to become the standard within the credit industry for determining the creditworthiness of potential borrowers. It consists of a series of questions, and answers are given a certain number of points. When they’re all added up, that number represents your FICO score. (All the information in your credit report is considered, of course, but FICO also examines more than twenty factors, divided into five main categories.)

The first category considers your payment history, and represents 35 percent of your score. The factor carrying the most weight is the timeliness of your payments, with emphasis placed on your most recent bills. Paying all your bills on time will raise your FICO score. The more late payments you’ve made, the lower your score will be. If your accounts have been turned over to collection agencies, that hurts even more, and if you’ve declared bankruptcy, that will earn you the lowest FICO score.

FICO places a 30 percent emphasis on the amount of money you owe and your available credit. It also asks about your outstanding debt, such as your mortgage, credit cards, and auto loans. FICO also asks the total amount of credit you have at your disposal. For instance, if you have five credit cards, each with a $2,000 limit, that amounts to $10,000 of available credit. Consumers who have access to a significant amount of credit have a tendency to use it, which can make them a greater credit risk overall. If your cards are close to the maximum already, that makes you an even less attractive risk. The people who obtain the highest FICO score in this category are those who use their credit prudently and maintain relatively low balances.

Some 15 percent of your FICO score comes from the length of your credit history. Simply put: the longer you’ve been using your credit, especially if it’s been with the same companies, the higher your FICO score will be.

FICO puts a 10 percent value on the overall mix of your credit. The more types of loans you’ve had, the better, as far as your FICO score. If you’ve had car loans, credit card payments, various types of installment loans, and a mortgage, you’ll receive a higher FICO score.

Your FICO score also gives you a 10 percent premium if you’ve sought new credit within the past year. FICO gives points for clients that are savvy enough to shop around for better interest rates for home or car loans from time to time. However, you get deductions if you apply for credit to many times.

Your FICO score can determine the percentage rate of your car or home loan, and may even get you a lower rate on your credit cards. It’s a number that’s worth knowing. However, don’t pay for your FICO score. The numbers you get from a paid service are NOT the same FICO scores your real estate lender gets. If you want to know your FICO, ask a loan officer.

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