There are very few financial decisions that can be made without some sort of credit check. Unfortunately for some, this type of background information is mired with problems and situations that may not have been under full control. Most creditors don't look at that, they simply look at the numbers and if the numbers don't match up, then a person can end up without the next step of their life. For those unfamiliar with how a credit score chart works, it's simple; it's a listing of what good vs. bad credit is and how the numbers represent each stage. Without knowing the numbers a person can be blindsided by the information they are given when they try to purchase a home, a car, or even rent an apartment. It's standard for a company to look at the numbers before giving anyone any sort of major trust, which is why it's crucial to understand the following numbers.
A Rudimentary Credit Score Chart
700 – 850 Good Credit (The Higher The Better)
620 – 699 OK Credit
500 – 619 Poor Credit
The above is just a very simple calculation of the numbers. For more elaborate representations there are a great deal of options to look at online. However, for the sake of understanding the numbers, the above can be far simpler than other options. The way the numbers are tabulated is a point of interest, and need further explanation in order to fully understand the complexity of a credit score chart.
It has been stated by financial professionals that there are 5 components to a FICO score, which is one of the major keys to an overall financial picture. If you can somehow master the five elements presented here, you will never have to worry about the future of finance in your life.
The first two things to pay attention to will make up roughly 70% of your overall score. You will need to remember this always, even if you forget everything else stated above and below. Pay your debts on time; never miss a payment, even if you're not paying off the maximum amount owed. Neglecting to do so will drop the numbers far below what is good. The second piece to the puzzle is the credit to debt ratio. This is vastly important to lenders because they want to know that if they give you a loan, you're not going to be crippled or over burdened and unable to pay back the principal amount.
The aforementioned two factors are so large, that without them, a credit score will never rise above poor status. The next three things are simply rudimentary at best. The 3 being the length of your history, the amount of credit accounts you have open and how many new accounts have been opened in the past few years. That's about it; these 3 items do not make up a whole lot of the score, and in some cases can't be fixed without time. The older a person gets the stronger their credit scores will be; it's just a natural progression.