How good is my credit score

Credit score varies from individual to individual. It depends upon the personal transactions made the individual. So before knowing how good your credit is, you need to know what is credit score and on what parameters they are given score.

Credit score is determines by various credit bureau. A person can itself know about its credit score through various websites also such as www.goodcredit.com. All the banks first check the credit scores and only then they give loan to people.

There are various models which are used to give the credit score but out of all models, FICO model is commonly used worldwide.

FICO model (or score) is first established in 1989. It analyze the score on basis of following parameters:

  • 35% payment history- this helps to check whether the person is not bankrupt or liar o bankrupt.

  • 30% debt burden- this helps to check whether the person is able to afford new credit returns or not.

  • 15% length of credit history-this helps to know about the usage and timely return of money.

  • 10% on credit searches- this helps to tell what kind of further loans a person is applied for.

These parameters are used by various websites such as www.goodcredit.com to carry out the correct evaluation of credit score.

And the range formed after analysis is this:

  • The range between 300 and 579 is considered poor and person falling in this range is need to deposit money or pay some fees in advance to get the credit.

  • The range between 580 and 669 is considered as quite fair and the person can get loan from few borrowers.

  • The range between 670 and 739 is considered good and some real good opportunities are available for this.

  • The range between 740 and 799 is considered very good and person get the more than average deal in it.

  • The range between 800 and 850 is considered as exceptionally good, and people get the top money lender and very good credit.

The range of credit score is between 300 and 850. But the best credit score is 700 and above.

  • So, if you have a credit score above 700 then you are in a good position. You will get all the good deal from the elite finance companies and other moneylender. You will get loan at low interest and credit card with a good credit limit. But if you credit score is 500 and below, then it is considered low and you are having a bad credit score. You now seriously need to work on your finance and to check your credit limit. So how all this can be done. It is very simple. You have to follow some basic things which can help you in maintaining good score such as,

  • Use the safe credit card

  • Close the card and account which is not in use

  • Pay the EMIs on time

  • Pay the credit card bills on time

  • Do not delay in any of your payments