GOOD CREDIT SCORE

Personal Credit score is important, it drives many things!!!

  1. Approve or Not
  2. Qualify For
  3. Interest Rate

The first thing it’s going to drive is whether you get approved or not. That’s one factor this is going to go in and how much, maybe, you can qualify for. Maybe the most important thing is the interest rate that you’re going to pay because the credit score is reflecting your financial behavior to perspective creditors. It’s a reflection of the risk. If your risk is high, then they’re going to be compensated for that in terms of interest rate and the interest rate will be higher. Your credit score is very good, the risk is low, you’ll pay lower interest rates.
There are people at every company that they do sort of loans that have risk management people that’s what they do is calculate how much of a risk you are to make your payments or not.
The one that you should really focus on is the FICO score. That’s the one that’s most common and most used everywhere. Every lender will use that FICO score a little bit differently but you can pretty much know the score range. It’s 300 to 850, higher is the better. If you’re in that kind of mid 700 or 750 plus,  That’s excellent credit. The average score for Americans is somewhere between 670 and 680 that’s the average.

Where is the troublesome spot?.. Once it gets below what is considered troublesome! Once you start to get, maybe, around 602, 600 and below, that’s where it becomes trouble some and you’re going to be paying higher interest rates and maybe even having some trouble getting approved. Let’s back up a little For people who may not have a lot of credit in their past, how should go about getting credit or attaining good credit? If you have no credit, here’s the best way to do it. Start small and BUILD. You don’t want to go with no credit an ask for a $60,000 BMW loan. You’re probably not going to get that. So lets be logical  start with a small credit card 500 to $1000, somewhere in that range. Possibilities in getting qualified for it or getting a cosigner that will vouch for you. But make sure you pay all bills on time so nothing negative hits there credit!!

The one element that really goes into effect it is time. If your credit, if you’ve established but it’s low, pay on time. Use things like auto pay to make sure that you can stay up on time on your payments and then the further any derogatories get in the past, the less impact they have on that score. It is good stuff. Having good credit score and keeping those interest rates low!

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