Do i have Bad Credit

It is more important that ever today to know how your credit score stands. If you have bad credit you cannot purchase a home, car or borrow on credit. With the economy as it is today it is hard to borrow money even when you have decent credit. Credit card companies are canceling cards and reducing credit limits under the new regulations. Finding money to borrow is getting more and more difficult and impossible if you do not have good credit. 

You need to be aware of your credit score on an ongoing basis in order to resolve problems before they arise if possible. The credit score is also knows and FICO. There are three organizations that track and report credit scores. Each agency uses a little different formula to determine the score.  

There are over than twenty things that are taken into consideration to determine the FICO. How you pay your bills is one aspect that thirty five percent of your score is based on. Whether you pay on time or have filed a bankruptcy will damage this portion of the score. How much due you own verses the amount of credit you have makes of for the next thirty percent of your score. Do not think that applying for a lot of credit cards that you will not use will help you raise this portion of the score because it will not. 

The next fifteen percent of the score is based on how long you have been using credit. Longevity is helpful as it can demonstrate your track record of repaying your debts. If you are trying to build your credit when you receive a credit card you should pay your balance every month.  

Ten percent of the credit score comes from the variety of credit you have. Do you have an auto loan, mortgage, credit cards or student loans? The remaining ten percent is determined from new applications. Every time you apply for credit your score is checked and that works against your credit score.  

If you have bad credit you need to begin to pay your bills on time all the time. If you have troubles meeting an obligation call the creditor to work out a mutually agreeable term. Do not wait until they begin to hound you for their money. When you are able to pay off a credit card you may want to close the account reduce your debt to available credit ratio.