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Standard 2 - Personal and financial goals can be achieved by applying economic concepts and principles to personal financial planning

, budgeting, spending, saving, investing,borrowing, and insuring decisions. Benchmark - - Evaluate the benefits and costs of credit; describe the three C's of credit and explain how these attributes can affect one's ability to borrow, rent, get a job and achieve other financial goals. FICO Score Chart

A lot of people are interchanging the term FICA score with FICO Score. Many people misspell and mix up FICA and FICO. But there’s a big difference between the two. Let me show you. Firstly, there is no such term as a FICA score. Although FICA does exist, it is the abbreviation for Federal Insurance Contribution Act, it has nothing to do with FICO and credit scores. FICO, on the other hand, is the abbreviation for Fair, Isaac and Company, the company that first started credit scoring system in 1958 and used widely today to evaluate a borrower’s credit worthiness. Understanding FICO Score Now that we’re clear with the confusion between the two. What exactly is a FICO score? What is a Good FICO score? FICO score is a 3-digit numerical index which represents an estimate of your financial credit worthiness. It is the most important number lenders used to determine who qualifies for a loan, at what interest rate, and to what credit limits. It is based on a subset of the information in your credit report, typically from the three major American credit bureaus: Equifax, Experian, andTransUnion. Though the scoring system used by all three credit bureaus are different but all point to one conclusion and

personal credit line or any other credit issues by the bank. Score Range 760 – 850 700 – 759 660 – 699 620 – 659 580 – 619 Below 579 Credit Rating Excellent Very Good Good Below Average Poor Very Poor . could result in much higher interest rates or having your application rejected outright. The higher is your credit score is. A low score. The following FICO Score Chart may help you to determine where your score is in relation to others. Creditors or lenders. This scores have proven to be very predictive in assessing the creditworthiness of a person or the likelihood that person will pay his or her debts.that is whether or not you have good or bad credit. Conversely. such as 500. such as banks and credit card companies. FICO Score Chart FICO score ranges between 300 to 850. so to speak. primarily use FICO scores to determine credit limits and interest rates every time when you apply for new credit card. those with a credit score of 760 – 850 would get the most favorable interest rates. mortgage. auto loan. the lower the risk is to the lenders and the easier you’ll obtain a loan.

charge higher interest rates.What’s In FICO Score? A credit score can be broken down into 5 components. every credit and lending decisions are based on an individual’s FICO score. it will be a good idea to first check where you stand on the credit score scale as where you’re on the scale can have a huge effect on the interest rates you’ll get and your ability to borrow money. it’s important to keep a healthy balance and ensure that you always make your payment on time. loans can be tough to obtain and can cost you thousands of dollars in higher interest rates more than they would if you had a decent score. It’s one of the most important factors to evaluate how much risk you are as a borrower. . Christopher Lewis. As such. Needless to say. getting mortgage with a 560 credit score is almost impossible nowadays. A low FICO score means banks and other financial institutions may deny credit. demand more collateral. According to Providian Financial executive J. some carry more weight than the others. What is a Good FICO Score? If your credit score is on the low side. your FICO credit score represents the likelihood that you’ll pay your debts or default on your loan. In general. or require extensive income and asset verification. consumers could save $16 billion just on credit card finance charges if they raised their average score by 30 points. If you are thinking of applying for a loan. Since the bulk of your credit score comes from your payment history and the amount you owe.

Knowing that your FICO score is important.Equifax.About . get your score (plus 3 in 1 credit report) from creditreport. Nothing on this site should be considered legal. How is the score determined? for a free trial.Sitemap . you're entitled to receive a free copy of your credit report annually from any of the 3 credit bureaus .look at the highlights in yellow}. Questions: 1. what might you start doing? Copyright © 2009 . Explain the difference between a high score and a low score. financial or other advice of any kind.Google+ Privacy Policy Disclaimer . Do you think it is a good idea to try to get your "free credit report" {hint. To view the actual score that the lenders are seeing. Describe what your FICO score is. What are the consequences of a low score? 4. you should consult with an independent financial adviser.2012 Credit Score Scale . 5. Disclaimer The purpose of this site is purely educational. this free report will not reveal your actual credit score. If you're looking for professional advice. and TransUnion.Although by law. Experian. 2.