Your Fico score is used to judge your 3 C’s – your capacity, character, and collateral. Capacity means how much you owe and whether you can pay these. Creditors look at your employment history, your income, the likelihood that your income will increase, as well as what credit lines you hold, their balances and limits, and your history of payments. Collateral – your assets – indicates to lenders what chance they have of getting their money back in case you are unable to pay your debt. Character refers to how trustworthy you are where money is concerned. It is a good practice to raise your credit score because creditors look at your past credit history, meaning how diligent you were in paying debts, if you have had any credit defaults and why, and how stable you are. Stability is measured by how long you have had your job, whether you rent or own your home, and whether you have savings and checking accounts.
With a good Fico score you can get additional credit faster, credit decisions on your applications will be fairer, if you make a mistake or two lenders will tend to be more lenient, and you can get better credit rates and terms. You can use your good credit standing to achieve your goals and build a better life and future for yourself and your family.
Financial success means being debt-free – not owing anybody. If you do borrow money, you pay off your debt on time. Having a good Fico score will help you achieve that success faster than other people if you continue to be careful about your spending habits and payments. Always strive to keep your Fico score high and make sure that any credit you apply for is in your best interests, and is paid promptly.
If you set a goal of achieving complete financial freedom, practice strong discipline, maintain your good credit standing and Fico score, live within your means, and put money away in liquid investments, you will be on your way to greater heights and an even better life than you are enjoying now. With the good Fico score that you have, you’re already halfway there. It takes just a little more work, if you use your Fico score as the motivation to achieve, you’ll achieve your goals before you know it.
Comments
Angelina February 26, 2009 02:51:54 PM 2:51 PM Another good advantage of having a good credit and a high Fico is when you are looking for a job. These days so many employers and companies are using credit check to filter job candidates so it always helps to keep a clean credit report and a high Fico score.
Juliana March 10, 2009 08:10:35 PM 8:10 PM FICO score is the important factor which represents our trustworthiness related to finance we can say. It is the important calculation which tells you whether we are eligible for credit or not.
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