In this article we will explore the FICO (r) Score 9 and explain its meaning. We will also discuss MyFICO, the other options available for a FICO (r) Score and how rent payments could affect your credit score. Before we dive into the details, let's first discuss the three main factors that impact your FICO(r). It's likely that you will want to understand what each means, so continue reading.
FICO(r), Score 9
FICO(r), scores have been around over 25 year, but they are most popular and widely known. Lenders began using FICO (r) Scores for the first time in 1989. Since then, many things have changed: consumer demands, data reporting practices, and credit-granting requirements. This is what you need to know regarding the credit scoring system. And, as always, keep your score in mind!
The FICO(r) Score 9 has several changes compared to its predecessors. Because medical debt is not included in calculating your score anymore, you will likely have a lower score if you receive a bill from a surgeon for the same procedure. Because collections do not affect your rental history you can start building credit history by paying rent.
Credit score and the impact of past rental payments
While it may seem unlikely that rent payments will affect your credit score or your credit rating, they do. These information are reported by credit bureaus. The credit scoring process considers whether you've paid on-time or not. Most credit scoring models look at both your rental payment history and your overall credit history. However, there are some important things you should know about this credit reporting data. Continue reading for more information.
Experian recently found that 75% of participants experienced a rise in credit scores after including rental payments on credit reports. The increase could be anywhere between 11 and 29 points. This change will help you, even though it might not seem significant. While the immediate impact of this change isn't significant, it can help you improve your credit score. Read on to find out more about how your rental history affects your credit score.
MyFICO
You might be curious about MyFICO score 9, if you have low credit scores. You can get it free from your creditor, lender, or credit counselor. A negative credit report can also be a problem. However, you can dispute it to lower your score. Good news is that you can improve your score and maintain low interest rates. Here are some suggestions.
Medical Collections. According to the Consumer Finance Protection Bureau (CFPB), the impact of medical collections is smaller than for other types. However, medical collection accounts shouldn't be completely ignored. The new FICO formula takes medical collections into account, but it is unclear how much. The impact of medical collections on your score is not as severe as other types of debts.
There are other options to get a FICO(r). Score
FICO(r), or credit scores, have been around for more than 30 years. They are a simple measure of your creditworthiness that are correlated with one another. FICO(r),9 is the current version and was developed to be more credit-friendly for consumers. The new version takes into consideration things such as rental history, payment history and medical debt but is less negative. A FICO(r) score 9 can also be obtained through student loans, debt consolidation loans, and home equity loans.
Although FICO(r),9 may seem like an enormous change, there are many things you could do to increase your score. You can make your payments on-time, for example. Your FICO score will rise by 25 points if you do this. A service such as LevelCredit reports your payments to TransUnion, Equifax and Equifax. You'll be able access to up to 24 month of past payments for a minimal one-time fee. Remember that not all lenders yet use the newer model so you might have to wait a bit before your FICO score is available.