Steps For Improving Credit

The Fair Isaac Company or other wise known as FICO is the largest credit scoring company

. All three major credit bureaus Experian, Equifax, Trans Union, use this credit scoring program. This scoring method is a numerical based expression that grades the consumer on their credit worthy ness.

35%. Payment History

30%. Debt Ratio

15% Length of Credit History

10% Types of Credit

10% Number of Credit Inquiries

Credit scoring is not limited to banks but minor purchases like a new cell phone, cable TV. Credit scoring allows lenders to calculate risk of consumers spending habits. All three major credit bureaus use a scoring method, a numerical code used to rate against you.

When measuring your FICO score 300s to the 800s is the range most credit bureaus rank you to understand your financial risk. Negative items reporting against you such as late payments, charge off accounts, bankruptcy, and repose just to name a couple can usually stay on your credit for 7 years. Depending on your state and the statue of limitations is how long items can stay on your credit until you can dispute it and get it removed.

Your FICO score allows you to be financially stable, understanding your credit allows you to get that car you always wanted, that house you dreamed of. THE AMERICAN DREAM!

The secret to great credit, is understanding your weakness as a consumer. Do you like to shop a lot? Then Stop. The credit card industry has changed a lot since the global slow down. It is a new ball game out their, the consumer is on the batting plate. We have more control than ever over our FICO score. The Consumer Credit Protection Laws that allow the consumer to check and repair their credit if any negative or inaccurate items are reporting against you.

A credit report is jam-packed with negative financial history to determine if you are a high or low risk to creditors. Many laws are in place to allow the consumer the rights to protect and fight the credit reporting agencies such as the Fair and Accurate Credit Transaction Act which entitles you to one free copy of your credit report yearly.

The first major section of the credit report contains your personal information. The second section contains your account history, this very important information which drives your FICO score. The finale key section of your credit reports lists inquiries made to your credit history in the past two years. After looking through your credit report and understand your FICO score, make sure you start righting dispute and intervention letters.

by: Jon Livingston

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