How is your Credit Score determined?
FICO determines your credit risk based on a numeric formula which includes: 35% = payment history; 30% total amounts owed; 15% duration of credit history; 10% types of credit.
Other credit score models have been created such as: VantageScore, CE Score, etc.
Why your Credit Score is so important?
Your credit score will follow you for your entire natural life. During the course of your life you will want to purchase vehicle(s), buy a home, rent an apartment, apply for credit cards, obtain insurance and look for employment. Your credit score will determine your eligibility for a loan or credit card and at what interest rate. To a future employer and insurance company your score will reflect your responsibility, accountability and dependability.
Benefits and consequences of your Credit Score.
Your credit score shows where you stand in the spectrum of credit reliability: Low Risk – High Risk. If you fall in the low risk category your interest rates are generally much lower than if you fall in the high-risk category. That means low risk individuals pay less and save more on borrowing money, obtaining insurance and landing that new job.
Challenging your credit score.
Credit bureaus make mistakes, identity theft, mistakes made by creditors and unverifiable reporting can be the cause of a low credit score. The process of protesting these negative items can be tedious and frustrating. CreditDefenseLegal.com has the power of our team of attorneys to demand inaccurate items be removed from your credit report and as a result increase your credit score. Call 915 533-2020 or email us email@example.com today. The cost of restoring your credit is far less than maintaining a low/fair credit score during your lifetime.