What Is A FICO Score?

The FICO score is a number that rates people according to their creditworthiness by the Fair Isaac Corporation, the largest credit-scoring companies in the world. Fair Isaac Corp. is the data that the three national credit reporting companies, Experian, TransUnion, Equifax list, in a proprietary, numerical formula, ranges from 300 to 850th This number is used by lenders of all kinds to a person's creditworthiness judge when deciding on new loans to a problemConsumers.

Fair Isaac provides a number of factors when) they calculate a FICO score, and the majority of which relates to the payment and the amount of the credit (blame, you've used. These two factors account for approximately 60% of the FICO score, the rest of the length of time that you have had credit, and together, the mixture of creditors. It breaks down into a percentage as follows:

35% is based on payment history, and how often youwere late.30% is the amount of total credit granted is based, and the amount of credits you are currently using.15% is how long you have had the accounts.10%, which is based on how much new credit was added.10% is based on the mixture of the creditors you are based.

Here are some basic things that you to improve your FICO score:

1. Never pay a bill after the due date. Always pay revolving credit lineMap Change before the due date, because any delay in payment is hurt your credit score. It is important to pay them immediately and not wait until the day before they are due, pay them. Give them at least a week to get it into the e-mail or pay online 2-3 days before the date due.

2. Do not carry high balances on your credit card. If you have more than 75% of available assets are charged, you will always be a risk to them, as people usually tap all the available credit --before they default. Keep balance between 25-50% of available credit.

3. Close the older accounts. When you finally pay out a map, one might be tempted to close it, not! It will hurt your credit in two ways, # 1, it will be this card that has a long history which shows that had the stability to close and # 2, it reduces your total credit available, which will increase your debt to-income ratio, which lowers your FICO score. Close to the endPay it off.

4. Department store and other specialty cards actually hurt your credit. Good debt, which look like mortgages, car loans and the four major credit cards good on your credit report. Department store cards really hurt your credit card you use your Visa or M / C in department stores.

5. Do not take any offer they send you. If you are constantly extending new credit line, you actually hurt your FICO score. Not only that, the novelty of theAccounts lower your score if you give too much credit, you will be your debt to income ration go up, lower your FICO. Do not ask for another card, instead of shred those offers.

Now that you know what your FICO score is and how it is measured, use these basic tips to improve your credit score. If you have bad credit, you need extra strength to help.