Credit scores impact every consumer's financial life. The ability of a person to get a home loan or new credit is greatly influenced by their 3 digit credit score.
Costa Mesa, CA -- (ReleaseWire) -- 03/24/2011 -- Credit scores impact every consumer's financial life. The ability of a person to get a home loan or new credit is greatly influenced by their 3 digit credit score. This number is a summation of all past financial history including payment history, use of credit, and the amount of businesses inquiring into credit. It was designed to help companies assess risky behavior and make better informed business decisions.
Understanding how credit numbers are calculated has importance because they can be improved. If consumers have basic knowledge of how the credit system works, they would be much more likely to stick to a plan that will land them a prime credit score. Once a good credit number is established, it can be used to qualify for lower interest rates, new credit, and more easily available loans. Landlords also can use this score to decide whether a potential tenant is trustworthy.
Most people don't take an active interest in finance, because it isn't as interesting as what's on television. But with all of the economic uncertainty in recent times, keeping closer tabs on debt, credit, and personal finances have become more important. In the last few years new credit is much harder to get and lenders go over all application with harsher scrutiny. FICO scores that may have been o.k. 4 years ago, no longer make the grade for a home loan. Increasing your credit limit is also difficult.
Investing in yourself by learning finance is one of the best ways to improve earning potential. Work is difficult to come by, so each dollar counts as if it were ten. Personal finance is one of the most important lessons that we can learn in life, and unfortunately no one teaches it in highschool.
http://greatcreditscore.org was created in order to help spread honest information about credit, debt and personal finance. The website covers topics such as how credit scores are calculated, the impact of bankruptcy on credit, and how reducing debt can affect your FICO score.
Also visit this link at http://greatcreditscore.org/scoring-factors/what-determines-your-score/ to see a breakdown of how credit score numbers are calculated.