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CREDIT ESSENTIALS
What Goes
Around, Shows up in your Credit Report! |
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In today’s fast moving society,
your credit standing tells everything about you: when you were
born, what you had been doing, what you are doing now, etc.
More importantly, it tells about your financial dealings and
how fairly you are meeting your financial obligations.
When you apply for a loan, credit card, auto loans and/or for
a home mortgage, the creditor verifies your credit rating by
accessing one or all of the three established credit bureaus,
namely, Equifax, Experian, and Trans Union, all of which use
a rating system established by “Fair Isaac & Company”, (FICO).
These creditors then determine your credit rating, known as
the FICO score. So, it pays to know your FICO.
How does it Work?
Your credit file generally consists of five different types
of information:
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1.
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Your name,
address & your social security number. |
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2.
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Your employment
records (both current & past). |
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3.
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Your credit
information- auto loan, credit cards, mortgage loans,
etc. |
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4.
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Your payment
history. |
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5.
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Any other
information such as, liens, judgments, bankruptcy, etc. |
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Inside
Tricks!
Your FICO is calculated as follows: |
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1.
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35% of consideration
is given to your payment history - how well you pay
your bills. |
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2.
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30% is assigned
to the total debt balance versus the total credit available. |
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3.
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15% consideration
is given to your past credit history. |
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4.
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10% consideration
is given to your present credit applications. |
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5.
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10% is an
overall view of types of debts you have (unsecured credit
would tilt against your score, but debts like mortgages
may not affect negatively).
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Learn more on how
to improve your credit on next page. |
Next Page
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