The Use of FICO Scores in Wolfpit, Kentucky

In Wolfpit The FICO Score is Important

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

In Wolfpit, Kentucky some of the most popular discussions amongst people would be related to credit report. The reason behind this is because the score achieved by any person would significantly influence the amount of home mortgage, loans and many other financial costs.

To put it simply, a credit history is similar to a report card from Wolfpit High School (I know, we’ve all been through that) where you would get a reprimand for something low and a reward for a good performance.

Contrary to what many people in Wolfpit believe, there is not a single, universal way of ranking credit score where the last time you took an extra 5 pennies from the cashier would be recorded on your credit report.

There is however, a widely used well known 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 adopted tool by most national banking and mortgage brokers in Wolfpit.

Before getting involved with the discussion on how FICO rating could be improved, it is worthy to have a rough idea on what your FICO rating is based on.

Simply speaking, 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 application for credit and/or amount of credit obtained recently.

The initial step to improving a FICO rating is to acquire a copy of your credit report. This can be attained from Equifax, TransUnion and Experian.

After that, prepare yourself for the misery (or delight if you are an accounting professional) of going through all the numbers and being sure everything adds up to the best of your knowledge.

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

If you have serious Charge Card debt where almost all of your balances are close to the credit line, it’s best if you pay them off as soon as possible. If you need help paying off debt, call for help at 844-CARE-866.

The banks and lenders prefer a significant 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.

Next, 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 impact you want on your FICO score if you do not pay your debt on schedule and every month.

The punctuality of your payment affects 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 keep 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 actually 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 receive a larger loan or a lower annual 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 on time and monitor where you are heading in your spending, mortgage and loans. 

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

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

Category: General