While obsessing over a FICO score is not a good idea, this is a number that will have a lot of bearing in your life. This number determines whether or not you will be able to get a house, a new credit card, or in many cases, whether or not you will be able to rent an apartment. Lenders and businesses are relying on FICO scores more than ever, and it is have never been more important to make sure that your score is where it should be.
If you are just starting to build up your credit history, this is the perfect opportunity to watch your score and see how different variable affect it. Over time, with proper management, you have the ability to get your FICO score up over 800, but it will take some work. If you have already made some mistakes and your score is under 600, don’t despair. There are plenty of ways that you can restore your FICO score.
First, you need to know just how bad it is. You may even want to consider purchasing a subscription that will allow you to monitor your score over time. This helps you see what is happening with your credit and can provide you with advance notice if something is going wrong with your credit. We highly recommend monitoring your score, especially if you are getting ready to buy a house.
Once you have an idea of the number you are working with, it is easier to begin the process of restoring your FICO score. The average American has a score that is around 680, which is considered satisfactory. A score over 720 is considered good, and above 775 is considered excellent. However, scores under 620 are considered to be very bad and it can be difficult to get a loan.
The higher your score is, the less impact small good changes will have on it. For example, if you are already at 750 and keep making monthly payments, without opening any new cards, you probably won’t see much change. However, bad changes can have a very big impact on your score. For example, a collection can drop your score by as much as 20%, or a late payment may cause it to nosedive.
It is a lot easier to see more changes when you are working with a lower score, especially when you are rebuilding your credit. If it is in the low 500s, or even lower than that, making little changes can actually give your score a nice bounce. If you do decide to use a credit score monitoring service, these bounces are a great motivator to keep up the good work.
Now that you know what you are dealing with in terms of your credit score, it is time to work on putting together a plan that will help you restore it. Our next post will cover specific steps that you can take to get on the road towards a perfect score.
One resource you should be sure to check out is the blog at Credit Karma. At Credit Karma, not only can you get a free credit score and offers from partners with a pro-consumer vision, but also find extremely relevant information about your credit score or credit cards such as: Relationship Between Age and Credit Scores, How Often Does Your Credit Score Change?, or How A Credit Card Limit Is Determined.
Photo Credits: 1
Originally posted 2008-09-25 05:06:45. Republished by Blog Post Promoter
Related Posts -
Making Extra Money With P2P Lending Peer to Peer lending is quickly becoming one of the hottest new ways to create multiple streams of income. While there is risk involved, there are various methods that can reduce the risks that individual investors face and provide protection against non-payments. If you're looking for an potential way to...... -
6 Easy Tips on Raising Your FICO Score In today’s world, it’s easy to define your self worth by your FICO score. Whether you are trying to buy a house, get more credit or just get back on the right track, a low FICO score can really impact your entire life. However, there are some easy steps that...... -
Restore Your FICO Score – Part Two In our last post, we covered how to begin the process of restoring your FICO score, as well as how changes can affect this score. Now that you are ready to begin, there are a few steps that you will need to take. Many of these steps require diligence on...... -
Seemingly Harmless Activities May Harm your Credit Your credit score is a vital number that determines how businesses and financial institutions treat you. Everything we do financially has an effect on our score, for good or bad. What surprises many people is how seemingly minor or harmless activities can have a big, negative impact. Described here are...... -
Restore Your FICO Score – Part Three In the previous parts of this article we discussed how FICO score can impact your financial status as well as the initial steps that you can take to begin restoring your FICO score. We covered handling collections first since they do have a big impact on your overall score, but......
Related Websites -
Money Mistake Monday - The Closing Credit Card Accounts Syndrome. I will admit right off the bat that a lot of people with credit problems will disagree with me on this one, in that they think the best thing to do with a credit card account is to close it immediately when you are done paying it off. And while...... - What Is A Good Credit Score Good For? Few things strike up a debate faster than asking what good is a credit score these days? There are those who totally spurn the idea of some 3rd party determining their credit worthiness. There are others who worship the mighty FICO, well aware of its ability to save them money......
- Psst... the Banks *ARE* lending money! I'm willing to bet that if you walked up to the average person on the street and asked them if it's possible to find a loan today, they'd tell you: No way, man! It seems like we've been hearing that the credit system has been frozen for months now.......
-
Start Making Lifestyle Changes It is common knowledge that making lifestyle changes can have a big impact on how much weight you lose and your chances of keeping it off over the long term. What isn’t as clear is how to effect those changes, especially if you are trying to lose weight on your...... - A little extra money in my paycheck I got paid last week and sure enough, there was a little extra money in my paycheck due to the Making Work Pay tax credit. As the IRS web site says, For 2009 and 2010, the Making Work Pay provision of the American Recovery and Reinvestment Act will provide a......
Categories:
Goal, Money, Personal Finance, credit score
Tags:
0 comments ↓
There are no comments yet...Kick things off by filling out the form below.
Leave a Comment