Updates on Determining Credit Scores
A couple weeks ago we discussed credit scores. Sharon Natarus over at Wells Fargo passed along some information to me about how the credit score structure is changing a little. This may prompt you to do one of your alloted credit checks for the year.
The changes made by the Fair Isaac Corp, creator of the FICO score, announced a new scoring rubric which has been instituted by the Better Business Bureau.
Credit scores range from 300 to 850, with a higher score a better score, and are used for a bank to determine the likelyhood a borrower will default on a loan.
The new criteria is designed to be more forgiving of minor slip-ups, allowing those things to have less of a negative impact. Fair Isaac believes more people will see their score increase rather than decrease. For instance, debts less than $100 will have less of an impact on your score.
The new system also takes a more comprehensive look at the creditor