Hello world! How’s your credit?
by RHONDABUCKNER [EDIT]
Everyone knows that we are scored by three different credit companies. Credit scoring is a numeric way of weighing various financial factors, like income, debts, job history, credit history and other factors, which can predict the likelihood of the borrower defaulting on the mortgage. While there are a number of credit scoring models used, most lenders seem to use the Fair Isaac & Co. (FICO) score that ranges from 300 to 850. The lower the score the higher the risk.
The score is developed by giving weight to the following areas:
Record of timely payments on loans 35%
Amount and type of outstanding debt 30%
Length of credit history 15%
Mix of accounts, credit cards, department stores,
finance companies, bank loans-10%
Number and types of account opened recently-10%
An A rating entitles borrower the prime interest rate, A pays .5%-1.0% more interest, B pays 1.0%-2.0% and C pays 2.0%-3.0% more than A, and so on.
Here are some tips to help: The longer that you have had credit without late payments the higher the score. The more sources of good credit references that you have the higher the score. On the negative side, slow payments lower the score, as do high loan balances. If account balances are 75% or more of the credit limit, it may signal high financial leverage and a higher risk . Credit balances should not exceed 30% of credit limit. Borrowers should not open many new accounts if they desire high credit scores.
The single most important thing one can do to improve your credit score is pay timely. A payment that is more than 30 days late in the past year may harm a credit score more than a bankruptcy that occurred more than 5 years ago!
Never use consumer finance companies, as credit scores are lowered for those using this type of credit.
It seems like everyone life revolves around their credit scores. In order to get insurance, a rental, a home, they pull your credit. I hope this helps you understand what they are looking for, and help you bring your score up. If you have question call me 352-266-263. Once you get your credit score fixed you will be able to buy your perfect home. I can get any one ready to buy a home in 1 year.