FICO Credit Rating Score Explained

Understanding your FICO score is reliably easy. Your credit rating is based on a number of factors, payment history, length of credit payment history, and indicative marks on a credit file. Unfortunately in a down economy many people are finding themselves with low credit scores. Lack of money available for payments on credit cards, mortgages and other unsecured loans can make a credit score drop dramatically. Many people are finding themselves in this situation due to a lack of employment, lack of resources and a slumped economic downturn.

Credit Ratings or Fico Rating can be easily computed as follows. A score under 600 is considered questionable although some lenders may allow a person to finance a car or possibly a home with a higher interest rate. Scores above 600 are generally considered good scores with scores above 750 excellent. Your credit rating is your livelihood. In a society which looks at people as a number and not much else, it is imperative to maintain a good credit score. Through hard work and maintaining a good credit rating your options will be much less limited.

Credit scores have been around for a long time. In a consumer driven economy people are constantly spending and constantly consuming. The more a person spends the more they owe. We as a nation live in a consumer driven economy. The more consumers spend, the more the economy is driven in a positive upswing. The less we spend the less money is being funneled into the society. When this happens we head towards recession. When consumers stop spending, businesses suffer, building sufferers and no one is making money. Because of this credit scores can plunge from scores in the high 600's and 700's and plunge below 600 leaving people vulnerable to homelessness, poverty and depression.

Credit scores have always been a determining factor in a person's credit; This is the way our economy and society work. If a person's credit is low, creditors are less likely to give the person any type of opportunity to finance. Flashy ads on TV depict people buying nice cars, homes and other items. Much of this bought on credit and the reputation a good credit rating can bring. However on the flip side a poor credit rating of 600 and below may make the person feel that they are a target of the system when in fact it is just the way the numbers add up. Maintaining a healthy fico score can be the difference between feeling on top of the world or feeling buried by it.

Source by Aileen L. Gardner

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