Frequenlty Asked Questions
About Improving Credit Score
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Your credit score, or FICO score, is essentially a calculation used by lenders to determine your eligibility for a loan, how much you can borrow and the corresponding interest rate.
Previously, your credit score was a mysterious, hidden computation that was primarily based on your payment history. Today, the breakdown of your score is a more clear-cut computation based on numerous important factors.
The five different factors used to calculate a score range of 300-850 need to be carefully examined and understood:
- Payment history
- Amounts owed
- Length of credit history
- Credit mix
- New credit
Debt reduction is the answer. An unhealthy debt-to-income ratio is essential to a solid credit score and financial health. Too much debt makes it impossible to obtain good lending rates or a balanced monthly budget.
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