Credit Score

CREDIT SCORE

Your Credit score is one of the most important factors used to decide whether you will qualify for a major loan and what the terms will be. Understanding how your credit score is formulated is your first step when applying for a loan.

The five parts of your credit score are:

1.        Your payment history.................about 35%

2.        How much you owe.................... about 30%

3.        Length of your credit history.......about 15 %

4.        New credit.................................... about 10%

5.        Other factors................................ about 10%

So be smart…plan ahead…don’t open credit card accounts right before applying for a loan.

Reduce your debt. Creditors look for an optimal total debt load of around 36% of your household income.

Pay on time! The easiest way to raise an ailing credit score is to make all your loan payments on time every month. 

 Try if you can, to pay more than the minimum due.

Timing is everything… wait 12 months following a credit problem to apply for a loan.

Get your finances in order…..Pay down your debt. Transferring from one credit card to another is not going to reduce your credit score.