Credit Scoring

Understanding FICO scores

  • FICO scores are your credit rating
  • Most lenders base approval on them
  • They range from 300-850, higher is better
  • Higher scores mean lower interest rates

FICO scores are calculated based on your rating in five general categories

CCCS Credit Scoring Graph
  • Missing payments (regardless of $ amounts . . . It takes 24 months to restore credit of one late pay)
  • Credit cards at capacity (i.e. maxing out credit cards)
  • Closing credit cards out
  • Shopping for credit excessively
  • Opening up numerous trades in a short time period
  • Having more revolving loans in relation to installment loans
  • Borrowing from finance companies
  • Transferring balances