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Knowing Your Credit Scores Helps You Boost It Higher

By Sally Maison
Published: Monday, April 26th, 2010

SBEXRF-00002308-001Did you know 70% of you have a credit score that actually affects the chances of you getting a loan for your car or a mortgage!

This 3 digit number scores a thought in your making you wonder why you need to know your score when you know what is in your report. Ray Martin, an advisor for finance says most of the financial institutions and lenders of mortgage accept applications based on your FICO points.

FICO score is actually the credit points that you score which is actually considered along with usual reports like your payment records, accounts based on credit. This FICO (fair Isaac and company) score should be between 300 and 850. This number makes it easier for lenders who usually take a risk on these evaluations. The higher your score, the higher is your chance to get the loan.

It is found that, the lenders have been approving applications based on your scores for a few years now, but only two years ago did they decide to let the applicants know of their score.

Know about the score

700 is the average score that almost 60% of the people have. To improve your chances, 720 or more is required. And once you touch 720 you don’t have to try harder cause the lenders shower themselves on you and it’s all your choice. But if it’s less than 700, give in your time to increase it.

Ways to increase your score

  1. Pay your bills on time so that all your past records show an on time payment and that none missed.-35%
  2. Pay your dues, as all the amount you owe a relative or close friend is measured to the calculated amount of credit that is actually available. This can lower your credit score as this will make the lenders think you can make lay payments.-30%
  3. Having a credit report that contains all your accounts helps. Your oldest recorded account is considered for your score and the average account age is taken.
  4. If you have opened many accounts in a short span of time, it could actually bring down your credit scores. It threatens a risk on lenders due to several reports.
  5. Your credit cards, financial loans and other retail accounts are considered as well, know what you do!

It is important to know what the scores take from you but you should also know that your age, assets, history of employment and income is not considered. All the payments made late, or missed payments are treated the same to all with no discrimination of any sort. Different lenders consider different means to assess your accounts. Also if you have a record of making a late payment very few times and never a missed payment, you are considered.

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