You have heard of credit scores, but what is this FICO?
Often you will see pop-ups on your screen regarding credit scores. You click on and you see FICO score, not credit score. What is this FICO? Is it a disease? Do I have it? Do I want to know if I have it?
It is not a disease. FICO is what the financial people refer to as your credit score. Guess they thought we would not figure that one out. FICO comes from a company that was started back in 1956 called Fair, Isaac Corporation. Fair Isaac was the creator of the credit scoring system. This system simply puts a number as your credit (FICO) score based on how good (or bad) you are at managing your debt.
OK, what does this number reflect? It reflects whether you pay off your credit card balances each month, whether you pay other bills on time, how many cards you have, and what percentage of your credit card limit you use each month, and possibly other data we don’t fully know about. This information is provided to them from the three credit bureaus that track just about every financial move you make. Equifax, Experian and TransUnion are the three credit bureaus.
This score allows a potential creditor to review your financial history so they have some idea of your future ability to pay back money that you want to borrow from them. This number indicates to the lender if you are going to pay that money back on time and in full, or if chances are you will default. The more of a risk they think you are the higher the interest rate they will charge you .
Yes, that would be why some people get a lower interest rate than you. They have a higher credit score (favorable) vs. a lower (unfavorable) credit score. So yes, you do want to know if you have it. More importantly, you should know what your credit score is.
Since making larger than minimum payments on your credit cards is a good idea, have you ever thought if only I could find some extra money? You have searched coat pockets or even the couch perhaps, but, have you ever searched the internet? CashUnclaimed.com is a website that searches state and federal databases to find unclaimed money. Yes, you could have money in an abandoned account just waiting for you to find it.
