Finding
Your Own Credit Score
You would think that finding out
what your credit score is would be easy. In a way it is,
but only because I’ve done my research and you won’t have to
spend time surfing websites looking for the ever elusive credit
number. It would seem logical to have your credit score
appear right on your credit report, but that’s just not the way
it is.
At one time, your
credit score was a big secret known only to financial companies
and banks. With the FACT Act, legislators decided that it
was important for individuals to know not only what their
personal credit scores are but how they are calculated and how
to improve them.
The main company
who calculates your credit score is the Field, Isaac Company
commonly known as FICO. They invented the concept of the
so they are the ones who are known as
experts in the industry. Before we go into finding your
score, let’s look at a few facts about the FICO
score.
-
FICO
scores are your credit rating
-
They
range from 300-850, higher is
better
-
Most
lenders base approval on them
-
Higher
scores mean lower interest
rates
-
FICO
scores are calculated based on your rating in five
general categories:
-
Field,
Isaac Company is the inventor of the FICO
score
-
They
have the only website offering all 3 of your FICO
scores
-
The
median FICO score in the U.S. is
723
Essentially, your
credit score is simply a snapshot of your credit use -- it's
the Cliffs Notes version of seven years of your borrowing
history. In many lending situations, the lender bases its
decision almost solely on your credit score. Consider your
credit score the overall GPA of your borrowing
history.
Now, here’s the
bad news. If you want to know your actual credit score,
you will usually have to purchase it. This can be done in
a few ways.
You can get it
from one of the three major credit reporting companies:
Equifax, Experian, and TransUnion. The fee isn’t a huge
one – usually around $15 or $20. However, if you’re
serious about growing your credit score, it’s well worth the
money to be financially responsible in the
end.
You can also go
to www.myfico.com and get your FICO score directly from
them. They will offer you a free 30 day trial membership
which will get your credit score right now and then, if you
wish to continue the membership, it will update the score as it
rises (or, heaven forbid lowers).
If you are
applying for a mortgage, here’s a little good news for
you. You can find out your credit score for free!
The mortgage company will base their decision and interest rate
on what your credit score number is, so just ask and they’ll
tell you!
range between 300 and 850. Here’s what those scores
mean:
- Over 750 – you have excellent credit and will be
able obtain credit easily
- 720 or more – you still have very good credit and
will be able to obtain credit
easily
- 660 to 720 – this is an acceptable credit.
You can still get loans, but you may pay a higher
interest rate
- 620 to 660 – creditors are going to be uncertain
about lending you money
- Less than 620
– you have poor credit history and will
probably not be able to obtain credit on your
own.
Knowing the above information makes it
obvious that if you need or want to get credit for
something, the higher your score is, the better your
chances are to not only get credit but get it at a
handsome interest rate. If you are in the 660 to
620 range, you may still get a loan, but the interest
rate is likely to be higher.
Click the link to get
your own
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