The Use of FICO Scores in Richton Park, Illinois

In Richton Park FICO Score is Important

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

In Richton Park, Illinois one of probably the most popular discussions between people would be related to credit reports. The main reason behind this is because the score achieved by any consumer would greatly affect the amount of mortgage, loan rates and many other financial related costs.

Simply put, a credit history compares to a report card from Richton Park High School (I know, we have all been through that) where you would get a reprimand for something low or rewarded for a good performance.

Contrary to what most people in Richton Park believe, there is not a single, universal way of ranking credit report where the last time you took an extra nickel from the cashier would be recorded on your credit history.

There is, a widely used popular credit score in the United States, commonly 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 banking and loan brokers in Richton Park.

Before engaging in the discussion on how FICO rating may be increased, it is worthy to have an outline on what FICO rating is based upon.

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

  • 35% – punctuality of payment in the past
  • 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% – types of credit used (installment, revolving or consumer finance).
  • 10% – recent application for credit and/or amount of credit obtained recently.

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

After that, prepare yourself for the agony (or joy if you’re a bookkeeper) of going through all the numbers and being sure everything adds up to the best of your recollection.

The reason is due to the fact that if something is wrong in your credit report, it’s best to get them fixed because it can take up to several months to get a correction.

Secondly, if you have serious credit Card debt where many of your 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 any excess credit card debt would definitely increase the FICO score as it impacts 30% of the FICO score.

Subsequently, it is equally important for you to pay off your debt on time. 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 time and each time.

The punctuality of your payment impacts 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 on schedule 3 years ago.

It is always important to maintain your longest standing account. 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.

For example, even though you score a relatively high score, if you credit history is just a few years as compared to an average rating with a credit history of 30 years, the person with the longer credit history would possibly qualify for a larger loan or a lower annual interest rate.

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

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

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

Category: General