Finance Review Journal » FICO Score http://www.financereviewjournal.com A compilation of information on business, commercial, merchant, trade and personal finance topics Mon, 27 Jul 2009 07:14:44 +0000 http://wordpress.org/?v=2.8.4 en hourly 1 Simulated Credit Scores with Ten Questions http://www.financereviewjournal.com/simulated-credit-scores-with-ten-questions/ http://www.financereviewjournal.com/simulated-credit-scores-with-ten-questions/#comments Mon, 21 Jul 2008 10:24:37 +0000 David Chin http://www.financereviewjournal.com/?p=26 Bankrate.com has a credit score calculator (dubbed the FICO Score Estimator) that uses a set of 10 questions.

Answer these questions and you'll get an estimate of your score.

Get started on the simulator right here.

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]]> http://www.financereviewjournal.com/simulated-credit-scores-with-ten-questions/feed/ 1 What is the best company to obtain FICO scores from? http://www.financereviewjournal.com/what-is-the-best-company-to-obtain-fico-scores-from/ http://www.financereviewjournal.com/what-is-the-best-company-to-obtain-fico-scores-from/#comments Mon, 23 Jul 2007 09:02:21 +0000 David Chin http://www.financereviewjournal.com/credit-reports-scores/what-is-the-best-company-to-obtain-fico-scores-from.php There is general consensus among various user feedback and reviews that the most reliable and trusted source for FICO scores is myFICO.com.
But you'll need to consider several factors before handing over $49.95 (correct as of July 2007) to the company for the information.

Visit Wikipedia for the complete definition of, and history behind FICO.

myFICO.com has FICO scores from all the three credit reporting agencies, namely Equifax, Experian, and TransUnion.

Are you planning to get a mortgage?
$50 is a lot of money to waste if you're not intending to get a mortgage in the next 6 to 12 months.

Why is this so?

FICO scores are primarily intended to be used by mortgage lenders to assess your creditworthiness before issuing you the loan, so, if you're not about to apply for the loan, there's not a justifiable need to get this information.
However, if you're the type who likes to keep your financial matters in order, there's no harm in buying the report. At least you know where your score stands, and will be fully prepared in the event you find yourself suddenly needing to get a mortgage or housing loan.

Other considerations
The main reason for purchasing your FICO scores is to know what your current credit situation is.

The higher your FICO, the lower your loan repayments will be, and the easier and faster it is to get your loan approved.

myFICO.com has a chart on their homepage showing you how much lower the APR (annual percentage rate) and monthly payments would be the higher your FICO scores are.

That chart allows you to compute the APR and monthly repayments for each US state or just the National Average.

Loan types shown are a 30-year fixed mortgage, a 15-yr home equity loan, and a 36-month auto loan.

You're allowed to input the loan amount, and the data is then re-calculated accordingly.

Just one example from the chart shows that a person applying for a $300,000 fixed mortgage for 30 years has to pay $2,600 per month at an APR of approximately 9.853%, vs another individual with FICO scores ranging between 760 to 850 - that person only incurs a $1,874 monthly repayment and enjoys a lower APR of 6.387%.

That's a huge motivation for increasing your FICO score.

Alternative sources of credit scores
If you're not preparing yourself to get a mortgage loan, working with the credit reports and regular scores from Equifax, Experian, and TransUnion is a perfectly viable and cheaper means of improving or maintaining your credit.

Yet another alternative is to try out a free FICO score estimator that's offered by Bankrate. Lifehacker.com has a post about the estimator, and the reader comments make for some interesting reading too.

FICO Score Groupings
You can determine whether your FICO score is "good" or "bad" and your corresponding credit standing depending on the which group your credit score falls under:

  • 700 to 850 » Excellent, or very good credit
  • 680 to 699 » Good credit
  • 620 to 679 » Just acceptable, or average credit
  • 580 to 619 » Low credit
  • 500 to 580 » Poor credit
  • 300 to 499 » Bad credit

You can estimate what your credit score is with a FICO calculator.

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