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Lenders use the FICO credit score to rate your credit history. Read the
information on this page to prepare for your loan negotiation and find out how you can
improve this important score.
The FICO Credit Score
An FICO credit score is a numeric score that summarizes your credit history. FICO
scores are provided to lenders by credit
reporting organizations. The score is intended to be a predictor on you
ability to pay back a loan.
The higher your FICO credit score is, the greater your likelihood of being approved for
the loan, and potentially with a lower interest rate.
How is My FICO Score Determined?
FICO scores are calculated and provided by Fair, Isaac & Co.
The calculation is based on the statistic analysis with the credit histories
of many borrowers. The specific factors that are used, and how they are used, are proprietary
to the company.
What is "A" Credit?
While factors vary, typically individuals with FICO scores above approximately
620 are deemed to be "A" credit borrowers.
- Review your credit report to correct any mistakes by a
credit bureau.
- It usually takes one full year of good credit behavior to see a significant change in
your credit score. This means that you should exhibit a full year of
responsible payment behavior in your credit report, including:
- Close unneeded accounts
- Pay off credit cards on time and keep your debt reasonable
- Be careful with new credit card use
- Take care of collection accounts
- Keep your job
- Don't change your address often
Improve your credit and then keep it good is critical. For a bad record
to entirely disappear, it takes seven years! If you have a bad credit today, you
will have a hard time to get a loan even if you have improved your financial situation
significantly within this period.
You may consider using a professional service to remove negative credits quickly from
your credit history, such as the Academy Law Firm.
Avoid Dealer Scam: Get Your FICO Credit Score before Shopping for a Car
Get your credit history report along with your FICO
credit sore. This is extremely important to protect you against this dealer scam.
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