In my last post, I was focused on insurance. Something that is equally important in respect of financial wellness is credit score. Most of us are aware of what credit score is It is nothing but a numerical representation of your credit history.
The entire credit history of an individual is taken into account by credit bureaus and the credit score is arrived at. Having a decent credit score is as important as money is for a living. Whether you apply for a loan, mortgage, or even apply for a job, the credit score is taken into consideration. Achieving a healthy credit score is not difficult if we pay a heed to some factors.
First and foremost, get rid of your outstanding debts as sooner as possible. Out standing debts, defaulted payments, can affect your score substantially. If needed you can seek help from a debt consolidation company.
It is a common misconception that consulting a debt consolidation company can lower your score. FICO does not consider it as a demerit. However there may be a mention that you are going through a debt consolidation program to pay off your outstanding liabilities.
FICO score is the most popular one used by majority of lenders in assessing an individual's credit worthiness. Other scores include Transunion, Equifax and Experian. These are all credit rating agencies that calculate credit score.
Something that could be a direct blow to your credit worthiness is any record of bankruptcy. This record not only lowers your credit score, but this mark stays up to 20 years. The length of your credit history is an important factor that increases your score.
If you have been too much persistent to apply for a credit card, and eventually got rejected, your score is likely to be hampered. Too many inquiries on your credit history affects credit score.
Common belief is that is you have been able to maintain multiple debts for a period of time; you are likely to be a dependable borrower.
A great way of improving your score is to diversify your borrowings. If you have a car loan, a mortgage loan, a credit card account, it would reflect your credibility as a borrower and jack up your score.
The entire credit history of an individual is taken into account by credit bureaus and the credit score is arrived at. Having a decent credit score is as important as money is for a living. Whether you apply for a loan, mortgage, or even apply for a job, the credit score is taken into consideration. Achieving a healthy credit score is not difficult if we pay a heed to some factors.
First and foremost, get rid of your outstanding debts as sooner as possible. Out standing debts, defaulted payments, can affect your score substantially. If needed you can seek help from a debt consolidation company.
It is a common misconception that consulting a debt consolidation company can lower your score. FICO does not consider it as a demerit. However there may be a mention that you are going through a debt consolidation program to pay off your outstanding liabilities.
FICO score is the most popular one used by majority of lenders in assessing an individual's credit worthiness. Other scores include Transunion, Equifax and Experian. These are all credit rating agencies that calculate credit score.
Something that could be a direct blow to your credit worthiness is any record of bankruptcy. This record not only lowers your credit score, but this mark stays up to 20 years. The length of your credit history is an important factor that increases your score.
If you have been too much persistent to apply for a credit card, and eventually got rejected, your score is likely to be hampered. Too many inquiries on your credit history affects credit score.
Common belief is that is you have been able to maintain multiple debts for a period of time; you are likely to be a dependable borrower.
A great way of improving your score is to diversify your borrowings. If you have a car loan, a mortgage loan, a credit card account, it would reflect your credibility as a borrower and jack up your score.
