The Use of FICO Scores in Mount Pleasant, South Carolina

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Jan 252017

In Mount Pleasant FICO Score is Important

Here are the Best Ways to Improve Your Credit Report FICO Score

In Mount Pleasant, South Carolina one of probably the most common discussions amongst friends could be connected to credit reports. The reason behind this is the score achieved by any individual would significantly influence the amount of home mortgage, loans and many other financial services.

To put it simply, a credit rating is similar to a report card from Mount Pleasant High School (I know, we have all been through that) where you would get a reprimand for a low grade but a reward for a good grade.

In contrast to what lots of folks in Mount Pleasant believe, there is not one universal way of categorizing credit report where the last time you took an extra 5 cents from the cashier would be recorded on your credit history.

There is, a widely used well known credit score in the USA, known as FICO or Fair Isaac Corporation. FICO score basically indicates the likelihood of a person to default on a loan and this is a commonly accepted tool by most banking and mortgage companies in Mount Pleasant.

Before engaging in the discussion on how FICO rating could be boosted, it important to have a rough idea on what your FICO rating is based upon.

Essentially, FICO rating is separated into a few statistical components where these components are made up from:

  • 35% – punctuality of payment historically
  • 30% – the amount of debt, expressed as the ratio of current revolving debt (credit card balances and others) to total available revolving credit (credit limits).
  • 15% – length of credit history.
  • 10% – varieties of credit used (installment, revolving or consumer finance).
  • 10% – recent application for credit and/or amount of credit obtained recently.

The very first step to improving a FICO rating is to get a copy of your personal credit report. This can be attained from Equifax, TransUnion or Experian.

Then, prepare yourself for the distress (or joy if you’re an accountant) of examining all the numbers and ensuring everything adds up to the best of your understanding.

The reason is due to the fact that if something is wrong in your credit history, it’s best to get all of them corrected because it can take up to several months to get a update entered.

If you have serious credit car debt where the majority of your credit card balances are close to the credit line, it’s best if you pay them off as soon as possible. If you need help paying off debt, contact Operation Care for financial coaching. Call them at 844-207-3818.

The banks and lenders prefer a significant gap between a credit card balance and the credit limit, approximately a ratio of 40% between balance/limit. Paying off high balance credit card debt would definitely increase the FICO score as it impacts 30% of the FICO score.

Afterward, it is equally important for you to pay off your debt promptly. Even if you have the ability to pay off your debt, it would not have the desire impact on your FICO score if you do not pay your debt on schedule and every month.

The punctuality of your payment takes up 35% of your score and it is vital to know that paying your debt on time NOW is outweighed by the fact that you paid your debt on time 3 years ago.

It is always important to keep your longest standing account. Because the longer you have your financial history established; the easier it is for the creditors or banks to know how reliable your FICO score is.

For example, even though you score a relatively high score, if you credit history is just five years when compared with an average rating with a credit history of 30 years, the person with the longer credit history would possibly qualify for a larger loan or a lower interest rate.

In conclusion, it’s a not nuclear physics when it comes to raising your FICO score. All it takes is for you to decrease your credit card debt, pay your bills on schedule and keep track of where you are heading in your spending, mortgage and loans.

The experts at Credit Repair Companies can help you better understand your credit report. Enroll in one of their coaching programs to improve your score.

Even if you don’t live in Mount Pleasant, South Carolina you can call toll free 844-207-3818 in order to get started increasing your FICO score and fixing your credit report.