Credit Secrets You Should Know

Did you Know, 35% of your FICO score is based on your payment history? 

Fair Isaac Corporation (abbreviation FICO) provides "software for calculating a person's credit score" (Dictionary). It is the largest and best-known of several credit- socing companies located in the USA.

Building or repairing your credit can take years. Consistently making late payments can severely damage your credit score, so make sure you make every payment before the due date. It can take a few days to get the creditor which could negatively impact your credit score. 

Many entrepreneurs don’t always get paid on a set frequency. That can throw their accounts into a tailspin if they are not carefully managing their budget. 

Financial fitness refers to having a healthy and stable financial situation. It involves managing your finances effectively by creating a budget, saving money, and investing wisely. You can achieve financial security and reach your long-term financial goals by being financially fit.

Here are some additional facts related to credit scores:

• Lenders use your credit score to determine your creditworthiness.

• Your credit score influences your ability to obtain loans, credit cards, and even jobs or housing.

• Payment history is the biggest factor in determining your credit score, accounting for 35% of your FICO score.

• Other factors that impact your credit score include credit utilization, length of credit history, types of credit, and new credit inquiries.

• You can improve your credit score by making on-time payments, keeping credit card balances low, and maintaining a long credit history.

• Checking your credit report regularly can help you identify errors or fraudulent activity that could impact your credit score.

• There are several credit monitoring services available that can help you stay on top of your credit score and credit report.

According to FICO.com, "ninety percent (90%) of top Canadian lenders and credit unions use FICO® Scores." Canada's two main credit bureaus are Equifax and TransUnion if you live in Quebec, and they both use the FICO system. FICO scores range from 250 to 900 depending on where you live. A new borrower will need a minimum FICO score of 580 to 620 to qualify for a loan or down payment program.

How is today’s economy affecting your credit? Share in the comments.

Disclaimer: I am not a certified financial planner. I am just a life coach sharing information.

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