Your fico score is actually the credit score that is derived from the free credit report that you can request from any of the credit bureaus. The score represents your credit history, your payment regularity and other aspects of your financial responsibility. Try to manage your fico score to avoid hassles in future credit dealings.



FICO score is used to determine the creditworthiness of a credit user. The lending industry relies a lot on the Fico score and hence it becomes essential for all credit users to maintain a good credit score and credit report. In simple words your FICO score lets a lender assess your ability to pay off your credit. This standard score is looked at by almost all lending companies, banks and other financial institutions. The FICO score is a credit score which has been developed by the Fair Isaac Corp. Fico score refers to the credit score derived from free credit reports which you can request from any of the three major credit bureaus once a year.

When one applies for credit, the lender will obtain the credit report of the applicant from a credit bureau. The bureau would prepare an annual credit report and calculate the fico score based on the standardized method developed by Fair Isaac Corp. Based on the fico score the lender would determine if you are worthy to get a loan. The fico score ranges from 300-850 and those who have a current score of 600 or higher are considered by the lenders as good credit users who are good at making payments on time. Those who score 499 or less are considered to have bad credit. But to have a low fico score doesn't mean that you are not eligible for loans. There are lenders who would provide you low credit score loans based on the assets you have, your employment status considering that you might also have to pay higher rates of interest.

How to raise your fico score?

Raising your fico score requires time and planning on your part. You cannot think to increase it just days before you decide to apply for a loan or mortgage. To keep your fico score at good positions you have to be consistently on time with your payments. Pay your bills on time, always keep your credit card balance below 30% of your credit limit and pay off the old negatives which are on your credit report. If you stick to these basics, your fico score will always be impressive and you won't have any problem with your lenders in the near future if you apply for a loan.

By federal law, you are entitled to have a free copy of your credit report if by any chance you have been wrongfully denied a loan or credit by a company. The company or the lender you applied for credit must furnish you the name and contact information of the credit bureau from where they obtained your credit information from. Once you have the contact of this credit bureau, you should contact them within 60 days using the information of your rejection, ask them to correct the wrong information on your report, and then obtain your credit report after the correction was made. This report is actually yours for free. The credit bureaus calculate your score and provide all information to the lenders who seek your credit report.

You can apply to obtain your fico score online. You can request a free annual credit report from any of the three credit bureaus and download it for free. You just have to visit the site of the bureau you wish to request your credit report from, and follow their instructions to receive free credit report.