Obtain A Free FICO Score

If you’ve read or heard anything about credit scores, you’ve heard mention of a FICO score but may not know what it is. The FICO calculates all your financial activities into a score ranging from 300 to 850. The higher your score, the better credit risk you are. The FICO is a tool used by lenders to help them decide if you’re a good credit risk. Anyone who applies for a loan will likely have their credit checked and their FICO number could make the difference between being approved for the loan or turned down.

Your credit report, used to calculate your FICO score, is an accounting of all your financial activity. Returned checks (NSF), late payments and loan defaults are all reported by your creditors to the three major credit history companies. If you pay off a loan early or make all your payments on time, there’s no glowing recommendation made. A credit report and the resulting FICO score are merely a dry accounting of financial facts.

You can and should receive a free credit report and FICO score every year from the three major credit-reporting companies. By calling or going online, it’s easy to keep an eye out for any erroneous information or mix-ups on your credit history.

The more responsible you’ve been with credit, the better your FICO score will be. Your score above 700 identifies you as an excellent credit risk and qualifies you for lower-interest loans as well as access to higher credit limits. You’re still considered a good risk if your score is above 680 but less than 700 but if the FICO sinks below 580 you’re considered a poor credit risk.

Your FICO is your credit reputation, just as your family name is your character reputation. It’s important to check it at least yearly to be sure that you’re not a victim of credit fraud. Your financial reputation is nearly as important as your personal reputation in this age of credit and credit abuse. Perhaps you want to buy your first home and have worked hard the past few years to establish yourself as a good credit risk; without regular checks of your credit report, all your conscientious efforts can be ruined by fraudulent activity of which you were unaware.

Like everything else, your credit report and FICO score needs to be watched. It would be wise to designate a certain time of year to request your credit report. By checking your credit regularly you can maintain your reputation as a good credit risk, prevent or quickly report fraudulent activity and avoid being the victim of identity theft.