Believe it or not, this week was the first time I’ve had a glimpse of my credit report and score. Don’t be like me. It’s advisable to check your credit report regularly especially now that identity theft is prevalent.
When I saw my credit score, the first question that came to mind was what is considered a good credit score. After a few searches, I found out I have an excellent credit score. What a relief.
I don’t know much about credit, so I’m posting here my questions, some answers I found and links to articles that I found helpful…
What is a good credit score?
FICO score ranges from 300 to 850, 850 being the best. It really depends on the lender whether your credit score is excellent, good or not. A good credit score is usually 700 or above.  720 and above can get you the best interest rates. Below 620 is usually seen as high-risk by lenders.
Links:
Do you have a good credit score?
What is a good credit score?
How is credit score calculated?
35%Â Payment History
30%Â Amounts Owed
15%Â Length of Credit History
10%Â Types of Credit Used
10%Â New Credit
Links:
What’s in your FICO score
How your credit score is calculated
How can I improve or maintain my credit score?
- Pay your bills on time.
- Maintain your balance at less than 25% of your total credit limit.
- Keep and maintain your accounts in good standing. The longer the length of a good credit history, the better.
- Don’t close your accounts especially those that have open for a long time and are in good standing.
- Refrain from opening several new accounts in a short period of time.
- Pay your debt instead of transferring it to another or new account.
- A mixture of different types of credit can improve your credit score as long as you keep them in good standing of course.
- Check your credit report for accuracy. With identity theft, you might find information that are not yours included in your report. By checking your credit report regularly, you’ll get to dispute these information before applying for new accounts.
- Avoid bankruptcy.
- If you’re looking to build a credit report, open savings and checking account. They are considered signs of stability among lenders.
Links:
Improving your FICO credit score
9 ways to build a killer credit score
How to improve your credit scores
The 3 credit agencies are actually in a battle with FICO. They are trying to roll out their own types of scores to take away Fair Issacs monopoly. All the banks and such still use FICO. We’ll see if that changes in the future.