The Use of FICO Scores in Visalia, California

In Visalia Your FICO Score is Important

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

In Visalia, California some of probably the most popular discussions among friends would be related to credit report. The reason behind this is due to the fact that the score achieved by any individual would greatly affect the amount of home mortgage, loans and many other financial related services.

Simply put, a credit score is like a report card from Visalia High School (I know, we have all been through that) where you would get a reprimand for something low and a reward for a good performance.

Unlike what many individuals in Visalia believe, there is not a single, universal way of categorizing credit rating where the last time you took an extra dime from the cashier would be recorded on your credit report.

There is though, a widely used popular credit score in the U.S., 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 embraced tool by most banking and in the credit industry in Visalia.

Before engaging in the discussion on how FICO rating could be boosted, it is worthy to have a rough idea on what FICO rating is based on.

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

After that, prepare yourself for the torment (or pleasure if you are an accountant) of examining all the numbers and ensuring everything adds up to the best of your recollection.

The reason is if something is incorrect in your credit history, it’s best to get them corrected immediately because it can take up to several months to get a correction.

Secondly, if you have serious Credit card debt where the majority of your Credit Card balances are at the maximum, it’s best if you pay them off asap. 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.

Subsequently, it is equally important for you to pay off your debt on time. Even if you have the ability 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 vital 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 keep your oldest 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 actually is.

For instance, even if you score a relatively high score, if you credit history is just 5 years when 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 interest rate.

In conclusion, it’s a not rocket science when it concerns raising your FICO score. All it takes is for you to reduce your total debt, pay your bills in a timely manner and keep track of 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 Visalia, California you can call toll free 844-207-3818 to get started increasing your credit score and fixing your credit report.

Category: General