Be aware of what influences your credit score

Mar 21 2010 Though most of us know that if we have to get the best interest rates for any loan that we take, we need to have good credit scores, very few of us are aware about how these scores are determined and what we can do to improve them.

When you go looking for a mortgage or car loan, your FICO score is the one that is taken into consideration and this is system of credit rating is utilized by consumer credit monitoring companies such as Experian, Transunion and Equifax.

Your credit score is dependent on factors such as payment history, existing debt, the different credits used, the period of credit usage and the new credit accounts that have come into use. Each of them has specific weight ages and that is how the total credit score is determined.

Of this almost two-thirds of the credit score is contributed by your track record of making payments as well as the new liabilities you have built up. All debt repayments, whether they are of credit card, car loans, house loans and retail are taken into consideration. However, any pending payments on utilities or rent are not taken into account.

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