A Good FICO Score

Let’s talk about your credit score. It is a 3 digit number that came from your credit report; it is something that is compared to millions of other people. This numerical representation brings all of your credit history into one objective number. Statistically, it is the most frequently used financial score to predict the amount you can receive as a loan and the interest you will have to pay. It is one of the most important things in your entire financial life!

The range of the FICO score is from 300 to 850. It is computed based on the following factors: Payment History (35% of score) Amounts Owed (30% of score) Length of Credit History (15% of score) New Credit (10% of score) Types of Credit in Use (10% of score).

The Fact Act entitles everyone to receive a copy of their annual credit report, but unfortunately this does not include their FICO score. Equifax scores are the one used by lenders to determine the amount of money they will charge you and the interest they will put into it. It is recommended that you request and pay for this score. Once requested, the consumer reporting agencies will provide to you the information on as many as four key factors that are negatively affecting your FICO score. The information they will be giving will help you determine how to improve your financial standing.

At the end of the day, your credit score determines the amount of money you can have as a loan and the interest with it, of course the higher your FICO score, the better arrangements you will be able to make with different financial institutions.