March is national credit education month, which means it’s time to learn about the importance of your FICO score. We hear about them all the time and Sally Taylor, VP and General Manager of Scores FICO, told us how to improve yours.
A FICO score summarizes your credit report into a three-digit number. Your FICO score looks at things like how much credit you have, how long you have been building credit, and how much of your available credit is being used. It helps lenders determine how likely you are to repay a loan. Sally says this affects how much you can borrow and how much you will pay interest.
There are several ways consumers can improve their credit scores. Paying your bills on time and actively monitoring your FICO score are the most effective. Research shows that consumers who frequently check their scores are likely to have a higher credit score.
Those with limited credit history pose a challenge to lenders’ ability to assess credit risk. To support these consumers, FICO developed FICO Score XD and the Ultra FICO Score, which enhances the traditional credit bureau data with additional info like how you pay your utilities as well as banking and checking account information.
FICO is also committed to financial education. They have started the nationwide Score Better Future education program to help consumers understand their credit and financial health. This is a free program open to the public.
Visit myFICO.com to find your accurate FICO score.