The Use of FICO Scores in Burlington, Kentucky

In Burlington FICO Score is Important

Here are the Best Ways to Improve Your Credit Report FICO Score 

In Burlington, Kentucky among the best typical discussions with friends is related to credit rating. The reason behind this is due to the fact that the score achieved by any individual would significantly affect the amount of mortgage, car loans and many other financial services.

Simply put, a credit rating is similar to a report card from Burlington High School (I know, we have all been through that) where you would get a reprimand for something low or get a reward for a high score.

Contrary to what lots of people in Burlington believe, there is no one universal way of ranking credit report where the last time you took an extra dime from the cashier would be recorded on your credit history.

There is though, a widely used well known credit score in the U.S., known as FICO or Fair Isaac Corporation. FICO score basically indicates the likelihood of a person to default on a loan and this is a commonly utilized tool by most national banking and in the credit industry in Burlington.

Before going into the discussion on how FICO rating could be increased, it valuable to have an idea on what your FICO rating is based on.

, FICO rating is separated into a few statistical components where these components are made up from:

  • 35% – punctuality of payment historically
  • 30% – the amount of debt, expressed as the ratio of current revolving debt (credit card balances and others) to total available revolving credit (credit limits).
  • 15% – length of credit history.
  • 10% – kinds of credit used (installment, revolving or consumer finance).
  • 10% – recent search for credit and/or amount of credit obtained recently.

The first step to improving a FICO rating is to obtain a copy of your own credit report. This can be attained from Equifax, TransUnion or Experian.

Next, brace yourself for the pain (or joy if you are an accountant) of examining all the numbers and ensuring everything adds up to the best of your understanding.

The main reason is if something is wrong in your report, it’s best to get it fixed because it can take up to months in order to get a update entered.

Secondly, if you have serious Credit card debt where the majority of your credit card balances are close to the maximum, it’s best if you pay them off as soon as you can. If you need help paying off debt, call for help at 844-CARE-866.

The banks and lenders prefer a large gap between a credit card balance and the credit limit, approximately a ratio of 40% between balance/limit. Paying off high balance credit card debt would definitely increase the FICO score as it impacts 30% of the FICO score.

Afterward, it is equally important for you to pay off your debt on schedule. Even if you are able to pay off your debt, it would not have the desire impact on your FICO score if you do not pay your debt on schedule and every time.

The punctuality of your payment takes up 35% of your score and it is important to know that paying your debt on time NOW is outweighed by the fact that you paid your debt in a timely manner 3 years ago.

It is always important to keep your longest standing account. Because the longer you have your financial history established; the easier it is for the creditors or banks to know how reliable your FICO score is.

Even if you score a relatively high score, if your credit history is just five years as compared to an average rating with a credit history of 30 years, the person with the longer credit history would possibly obtain a larger loan or a lower interest rate.

All in all, it’s a not nuclear physics when it concerns raising your FICO score. All it takes is for you to reduce your credit card debt, pay your bills in a timely manner and keep an eye on where you are heading in your spending, mortgage and loans. 

There are professionals at Credit Repair can help you better understand your credit score. Enroll in one of their coaching programs to improve your score.

Even if you don’t live in Burlington, Kentucky you can call toll free 844-207-3818 to get started increasing your credit score and fixing your credit report.

Category: General