If you are applying for a loan, the likelihood that lenders will accept your application depends on your FICO score. Also, if you are planning to apply for a mortgage, a credit card or an insurance policy, your application will also be judged partly on your FICO or other credit scores. Are you a bit confused on what FICO score is and how it is calculated$%: FICO score FAQs can be of great help. In the internet, there are lots of sites containing FICO Score FAQs and answers which can surely help you better understand your FICO score and how important it is to you and to your finances.
What is a FICO Score$%:
A FICO score is a type of credit score that$%:s widely used by lenders to determine the probability that borrowers will pay their loans and bills. This credit score is developed in the late 1950s by Fair Isaac :%$amp; Co. At present, it has been recognized by most lenders as a reliable process of credit assessment and the Federal Trade Commission has approved it to be satisfactory.
Some examples
What factors are considered to determine my FICO Score$%:
Lenders will primarily look at your credit history and information. And the factors in your credit information that have an impact in your FICO score are categorized into five $%: payment history, outstanding debt, length of credit history, new credit applications and types of credit used.
How can I improve or repair my credit score$%:
Since your FICO score takes into consideration your entire credit or payment history, improving it is attainable, but can$%:t be done over a short span of time. The best thing that you can do is to always pay your bills on time and maintain low balance on unsecured debts like credit cards. Also, try to limit your credit accounts to the things you really need. Verify your credit report and be sure that all the information there is precise. Refrain from frequent credit application and see to it that your credit is checked only when absolutely necessary.
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