My credit score...not sure what it means
- Thread starter EboniGoddess
- Start date
Principessa
Expert Member
Yup, that is correct. :yup: Everytime you apply for an instant credit, a cell phone or any type of charge card it shows up on your credit report.
And that partiallly explains why so many people are in foreclosure now. :frown1:
That's fucking excellent! Consider yourself lucky.
Your credit score is a number generated by a mathematical algorithm -- a formula -- based on information in your credit report, compared to information on tens of millions of other people. The resulting number is a highly accurate prediction of how likely you are to pay your bills.
Lenders can use one of many different credit-scoring models to determine if you are creditworthy. Different models can produce different scores. However, lenders use some scoring models more than others. The FICO score is one such popular scoring method. Its scale runs from 300 to 850. The vast majority of people will have scores between 600 and 800. A score of 720 or higher will get you the most favorable interest rates on a mortgage, according to data from Fair Isaac Corp., a California-based company that developed the first credit score as well as the FICO score.
transunion gives me 721, experian 714 and equifax 711. how can they all be different. I don't have any bills to be late on. Im confused. Do they all use different scales or something? [/QUOTE] As a matter of fact that is correct, they all use a variation on the FICO scoring method. :biggrin1:Lenders can use one of many different credit-scoring models to determine if you are creditworthy. Different models can produce different scores. However, lenders use some scoring models more than others. The FICO score is one such popular scoring method. Its scale runs from 300 to 850. The vast majority of people will have scores between 600 and 800. A score of 720 or higher will get you the most favorable interest rates on a mortgage, according to data from Fair Isaac Corp., a California-based company that developed the first credit score as well as the FICO score.
Currently, each of the three major credit bureaus uses their own version of the FICO scoring method -- Equifax has the BEACON score, Experian has the Experian/Fair Isaac Risk Model and TransUnion has the EMPIRICA score. The three versions can come up with varying scores because they use different algorithms. (Variance can also occur because of differences in data contained in different credit reports.)
No matter which scoring model lenders use, it pays to have a great credit score. Your credit score affects whether you get credit or not, and how high your interest rate will be. A better score can lower your interest rate.
The difference in the interest rates offered to a person with a score of 520 and a person with a 720 score is 4.36 percentage points, according to Fair Isaac's Web site. On a $100,000, 30-year mortgage, that difference would cost more than $110,325 extra in interest charges, according to Bankrate.com's mortgage calculator. The difference in the monthly payment alone would be about $307.
No matter which scoring model lenders use, it pays to have a great credit score. Your credit score affects whether you get credit or not, and how high your interest rate will be. A better score can lower your interest rate.
The difference in the interest rates offered to a person with a score of 520 and a person with a 720 score is 4.36 percentage points, according to Fair Isaac's Web site. On a $100,000, 30-year mortgage, that difference would cost more than $110,325 extra in interest charges, according to Bankrate.com's mortgage calculator. The difference in the monthly payment alone would be about $307.
There are three credit reporting agencies. Unfortunately, they do not have to show your credit scoring to be the same. Equifax, Experian and TransUnion. One may provide your rating at 700 while one of the others show 670.
When (if) you apply for credit, the company may contact only one of the agencies and determing your score. Depending on which one, you could be denied credit.
This isn't fair but that's the way it is.
BTW, applying for too many charge cards can affect your credit rating. When car shopping, all your visits are usually submitted.
You can obtain a free copy of each once a year.
When (if) you apply for credit, the company may contact only one of the agencies and determing your score. Depending on which one, you could be denied credit.
This isn't fair but that's the way it is.
BTW, applying for too many charge cards can affect your credit rating. When car shopping, all your visits are usually submitted.
You can obtain a free copy of each once a year.
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