Thursday, January 7, 2010

Credit Rating: How they calculated?

Most people know that credit scores to decide what, how much you can borrow loans, but few people really know how to calculate the credit score.
If you attempt to loan funds or financial institutions to obtain credit cards, trying to call the finance company, your credit report, that the requirement be disqualified score a copy of (or) your loan or line of credit, including.

Credit scores range from 340-850, andIn order to reduce risk, the lenders to determine your money or credit cards. A person's credit score 480 is a greater risk than a single position, with a 700 credit score the lender if you do not know your credit score, this may be a good idea to find out.

Three credit bureaus - the Equifax, Experian, and TransUnion - use special types of software, in your credit report information is used to generate a digital result. CreditBonds are sometimes referred to as "FICO score" because the first credit scoring software production, and Fair Isaac's FICO distribution.

Credits the following information:

35% payment history

30% of the amount of arrears

15% of the length of credit history

10% of the credit to use species

10% of new loans will be

Payment History

Your payment history, including all of your past creditAccounts - including loans, mortgages, financing and credit lines. This is your account "paid as agreed"; negative accounts and collections, and criminal accounts. Show arrears account the number of accounts has expired, time, amount, the invoice is overdue for how much time has past, because you have had an overdue payment.

The amount of arrears

Parts, including the reimbursement owed to you, you long to pay off Your credit card, you have the number of credit can be recycled, the total number of zero-balance accounts. This is used to determine how long you have to pay your debts and how much you continue to grow, as time goes on.

Length of Credit History

Your credit score will also show how long your credit report be prosecuted, and how how long, since you last opened account. The longer your credit report is to seek higher credit"Customers on how to continue making payments to avoid the collection.

Use the type of credit

Than many other types of credit card. Your credit record, including mortgages, auto loans, commercial loans and a variety of financing, if you use different types of loans such as credit card - not just revolving credit facility, - Your credit score will be higher.

The new loan should be

New loansAre those open or in the past 6 months paid account. The new credit can not be established, as the old account for a large proportion, because (you pay less, or not too) payment.

Credit score is generated for all three credit bureaus, you can have three different credit score. The three offices is to calculate the credit score used in different ways, and office and more information than others. This is your loan up to a positive or negative credit report,If they make a report, only one, it does not appear anywhere else.

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