Your Credit History & FICO Score
When it comes to credit, you need to know that your
credit score can and does affect you financially.
Today’s financial indiscretions become tomorrow’s
low credit score!
Even though you have “perfect credit history”, you
may have a lower than perfect credit score.
· 35%
of
your score is based upon your payment history.
· 30%
of scores are based on debt ratio.
· 15%
is comprised of the length of credit history.
· 10%
is based on credit type (mortgage/auto loans/credit
cards)
· 10%
of your score is based on inquiries
Here’s ways to establish and improve your credit
history & FICO (Fair Isaac Company—an organization
that establishes an equation to represent your
creditworthiness in a three-digit number) scores:
1. Pay
your bills on time
2. Don’t
bounce checks
3. Start
small
4. Visit
local lenders
5. Apply
for a secured credit card
6. Apply
for a small loan or credit card with a co-signer
7. Review
your credit report once a year
8. Review
your credit report a few months before requesting a
major loan
9. Avoid
letting accounts to turned over to a collection
agency
10. Avoid
having judgments filed against you
11. When
denied credit, review your credit report
12. Try
to avoid constantly switching employers
13. Try
to avoid frequent changes in residence
14. Work
to increase your income
15. Work
to decrease your debt
Remember, establishing credit or repairing bruised
credit takes time… it won’t happen overnight!
You have to approach this as a long-term goal. If
you’re just beginning to establish credit for the
first time, take things slow and begin by opening a
few small accounts. With these initial accounts,
make sure you use the credit wisely and develop
sound habits. Before long, you’ll be on your way to
building a great credit history!
Important contact information:
· Annual
Credit Report Request, P.O. Box 105281, Atlanta, GA
30348
http://www.annualcreditreport.com
· Equifax
800.685.1111 http://www.equifax.com
· Experian
(formerly TRW) 888.397.3742 http://www.experian.com
· TransUnion
800.888.4213 http://www.transunion.com
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