Diana Hill
Online Trading Academy
If you have had the opportunity to be part of our Financial Matter Classes you may have heard a great class on credit. I thought I’d provide you some basic information about credit scores.
Let start with FICO:
In 1972, Fair Isaac developed the first automated credit processing system. Wells Fargo was the first to implement it. This development made it possible for companies to extend credit safely and efficiently to as many consumers as possible, which further helped to make the use of credit cards nearly universal. In 1979, the company developed the numerical credit scoring system–FICO–that is commonly used today. While it was not the first automated credit scoring system, it grew rapidly to become the market leader, boosted in the mid-1990s by the endorsement of FICO by Fannie May and Freddie Mac.
Below are the scores and the letter grades associated with them.
FICO Score Range
There is also another scoring system in town. It’s called VantageScore. The nation’s three major credit reporting companies (CRC’s) – Equifax, Experian and TransUnion, all worked together in 2006 to develop a generic credit scoring model that is regularly revalidated. This is the first time the three CRC’s have worked together. Why, you might ask? Well, they pay a license fee to FICO for using their credit scoring model and I imagine that they found it was more cost effective to create their own.
Vantage score has recently come out with its new model 3.0. The range of scores now go from 300 to 850 using a numerical scale that is more commonly accepted – previously the scoring model was 501-990.
Here are a few things you can do to improve your credit score:
Pay your bills on time
Apply for credit only when needed
Keep outstanding balances low
Reduce total debt
Build and maintain your credit history
Remember, I love to hear from you so feel free to email me with questions.
This content is intended to provide educational information only. This information should not be construed as individual or customized legal, tax, financial or investment services. As each individual's situation is unique, a qualified professional should be consulted before making legal, tax, financial and investment decisions. The educational information provided in this article does not comprise any course or a part of any course that may be used as an educational credit for any certification purpose and will not prepare any User to be accredited for any licenses in any industry and will not prepare any User to get a job. Reproduced by permission from OTAcademy.com click here for Terms of Use: https://www.otacademy.com/about/terms
Editors’ Picks
EUR/USD looks offered below 1.1900
EUR/USD keeps its bearish tone unchanged ahead of the opening bell in Asia, returning to the sub-1.1900 region following a firmer tone in the US Dollar. Indeed, the pair reverses two consecutive daily gains amid steady caution ahead of Wednesday’s key US Nonfarm Payrolls release.
GBP/USD slips back to daily lows near 1.3640
GBP/USD drops to daily lows near 1.3640 as sellers push harder and the Greenback extends its rebound in the latter part of Tuesday’s session. Looking ahead, the combination of key US releases, including NFP and CPI, alongside important UK data, should keep the pound firmly in focus over the coming days.
USD/JPY drops toward 155.00 as focus shifts to US data
USD/JPY meets fresh supply and inches closer toward 155.00 in the Asian session on Tuesday. The Japanese Yen holds the upper hand over the US Dollar after Japanese Prime Minister Sanae Takaichi led the ruling Liberal Democratic Party to a historic landslide win and on intervention talks. Traders brace for key US economic data that could offer more clues on the Federal Reserve's monetary policy.
Editors’ Picks
AUD/USD meets initial resistance around 0.7100
A decent rebound in the US Dollar is behind the AUD/USD’s daily pullback on Tuesday. In fact, the pair comes under modest downside pressure soon after hitting fresh yearly peaks in levels just shy of 0.7100 the figure on Monday. Moving forward, investors are expected to closely follow the release of Chinese inflation data on Wednesday.
EUR/USD looks offered below 1.1900
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Gold remains on the defensive and approaches the key $5,000 region per troy ounce on Tuesday, giving back part of its recent two day. The precious metal’s pullback unfolds against a firmer tone in the US Dollar, declining US Treasury yields and steady caution ahead of upcoming key US data releases.
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