Your Credit Rating Might Not Be What You Think
As if the credit rating system which lenders use to help decide whether or not to offer you credit - and at what interest rates - wasn’t complicated enough, not many people realize that there are actually multiple credit rating systems in operation and the credit score that you get from a report may well be different to the credit score a lender gets about you.
The most well-known system, FICO, is just one way that your credit rating can be measured, and a lender may access a PLUS Score or a Vantage score, or even a FAKO. This makes the whole system not very transparent for a consumer who’s trying hard to improve their credit rating.
So what can you do about it? First of all, it’s important to be aware of the imperfections of the system, which will help explain anomalies when you think your credit rating should have the lender offering you something better. It’s also important to study the report that comes with your credit score to determine what you need to do to improve your credit rating, regardless of the score. Concentrate on the methods of improving your credit rather than fixating on the score and you will probably come out on top.
This entry was posted on Wednesday, October 1st, 2008 at 5:56 am and is filed under Debt Management. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.
