Results tagged “FICO” from Payday Loan Quotes Blog

Your FICO score is based on a mathematical equation. It is set up to evaluate information from your credit report and compare it against patterns of other credit users to identify your credit risk, that is, how likely it is you'll pay back loans. Scores may differ among the bureaus for three reasons:

1. Not all lenders report to all three bureaus.
2. Not all lenders report to the bureaus at the same time of the month.
3. The Fair Isaacs software for creating the credit score is different (but similar) at each bureau.

Believe it or not, it's not too difficult to read a credit report. While each of the three credit bureaus uses a different format, they're all pretty cut and dry, whether you're reading it online or on paper.

Each report is separated into six sections: Personal ID Information, Credit History, Collections, Courthouse Records, Additional Information, Credit Inquiries.

Personal ID Information:
Here you'll find your name, address, Social Security number, date of birth, and employment information, including your past employers and job titles. (This information is not used to determine your FICO score.) This section also may contain your spouse's name, the name of your employer, phone numbers, and your driver's license number.

Credit History:
This section contains your credit/loan accounts. For each account, the following information is listed:

Credit Cards (Revolving Credit)
1. Account name (American Express, Visa, Mastercard, etc.)
2. Account number
3. Date opened
4. Current balance
5. Highest balance
6. Amount past due
7. Credit limit
8. Type of credit - Revolving
9. Whether it's a joint or authorized account. A joint account makes your financially responsible for paying what the other joint holder spends. An authorized user doesn't and can help build your credit history and make it possible for you to qualify for an individual account.
10. Minimum payment required
11. Last activity - This date is the last payment or last charge you made.
12. Months reviewed - how many months the account history has been reported
13. Account status - open, paid and closed, inactive, paid in full
14. Your payment history - "pays as agreed," "30 days late," "60 days late, "90 days late," "charge off" (the credit has attempted to get paid but has given up)

Installment Loans
1. Date opened
2. Type of credit (installment -- mortgage, car loan, student loan, etc.)
3. Whether it's a joint, co-signed, individual account
4. Loan amount
5. Required monthly payments
6. Amount past due
7. How much you owe
8. Months reviewed - how many months the account history has been reported
9. Last activity - This date is the last payment you made.
10. Account status - open, paid and closed, inactive, paid in full
11. Your payment history - "pays as agreed," "30 days late," "60 days late, "90 days late," "charge off" (the credit has attempted to get paid but has given up)

Collections:
This section contains any delinquent accounts reported to collections agencies during the past 7 years. It contains the following:
• Name of collection agency
• Amount owed
When you pay off your debt, get it in writing from the collection agency and send it to the credit bureaus. Make sure the collection agency does the same.

Courthouse Records/Public Records:
This section contains the following records for up to 7 years, with the exception of bankruptcies:
• Bankruptcies (up to 10 years old)
• Foreclosures
• Overdue debt from collection agencies
• Tax liens
• Garnishments
• Lawsuits
• Judgments from state and county courts
• Overdue child support payments (in some states)

Additional Information:
This section may list your former employers and your past addresses.

Credit Inquiries:
This section is divided into two - voluntary and involuntary inquiries. Voluntary inquiries are those where creditors/lenders that have accessed your credit report with your permission over the last 2 years to determine your creditworthiness. Involuntary inquiries are those made by lenders that offer you credit by mail. These inquiries, and those made by your existing creditors, don't affect your credit score. However, if you accept a pre-approved credit card offer made in the mail, or apply for credit, that acceptance will lead to an inquiry that will affect your credit score.

Four factors help a lender determine if it will lend you money and under what terms:

1. Your credit score
2. Your employment history
3. How much debt you have compared with how much income you have
4. Your credit history

You can order a free credit report from all three bureaus every 12 months at www.annualcreditreport.com or toll-free at 877-322-8228.

If you go online to view them, you'll have to know certain information contained in them - each credit bureau asks for different information to ensure your identity. Information includes things like the name of your mortgage company, if you have one, and former street addresses. Don't worry if you get an answer wrong. You'll be given a second shot at it.

$ Tip! To get the best interest rate when applying for a loan, first determine which credit bureau has the highest FICO score for you. Next, find a lender that uses that credit bureau report.

What would you do?
Mary is offered 10 percent off all sale items if she opens a new department store credit card. She figures it'll knock off $10 from her bill, not a bad savings. Every dollar counts when you're shopping for a new car, she figures. Don't do it, Mary! Every inquiry for new credit makes creditors/lenders uneasy, and opening a new credit card account will reduce your credit score!

To get a FICO credit score, you must have a credit account that reports to at least one of the three credit bureaus, and you must keep that account open for at least 6 months.
Note: As of September 2007, Fair Isaacs Corporation is changing their credit scoring software at each of the three credit bureaus. Authorized credit card account holders will no longer have a credit score. An authorized user is someone, usually a family member, who is allowed to use the account but who is not held financially responsible for payment. Permitting an authorized account has been a way for young people to establish credit. This change in credit scoring is to protect lenders from abuse in the marketplace of authorized user credit card accounts by so-called credit repair services that sell good credit card histories to those with poor histories, a strategy called "piggybacking."

Did you know? Your FICO score may be different at each of the three credit bureaus, because credit card companies may report to each one at a different time of the month and not all credit card companies report to all three bureaus.