Did you know?
That buying a car reduces your credit score because a car depreciates in value, but a home purchase increases your credit score because a home appreciates in value.
A credit score is primarily based on credit report information, typically from the three major credit bureaus, namely Experian, Transunion and Equifax.
In the U.K. there is much academic research into credit scoring.It is very difficult for a consumer to know in advance if he or she will have a high enough credit score to be accepted for credit with a particular lender. This is due to the complexity and structure of credit scoring which differs from one lender to another. Also, lenders do not have to reveal their credit scoring methods, nor do they have to reveal the minimum credit score required for the applicant to be accepted. Simply due to this lack of information to the consumer, it is impossible for him or her to know in advance if they will pass a lender's credit scoring requirements. If the applicant is declined for credit, the lender is also not obliged to reveal the exact reason why.
A FICO score is a credit score developed by Fair Isaac & Co. Credit scoring is a method of determining the likelihood that credit users will pay their bills. Fair, Isaac began its pioneering work with credit scoring in the late 1950s and, since then, scoring has become widely accepted by lenders as a reliable means of credit evaluation. A credit score attempts to condense a borrowers credit history into a single number. Fair, Isaac & Co. and the credit bureaus do not reveal how these scores are computed. The Federal Trade Commission has ruled this to be acceptable.
