With all of the confusion of between credit ratings, credit scores, FICO scores and credit reports, for some people, finding out the differences between the two is all that is needed to be able to keep ones finances and financial livelihood up to par standards. If you need to repair your credit, you need to examine your FICO score first and foremost to see where the score is hurting the most.

What exactly does FICO stand for? FICO stands for the Fair Isaac Corporation and was established in 1956 to help creditors and debtors come together in the financial world to prove a person's credit worthiness. Having a low FICO score will inhibit you to repair your credit.

The FICO score is broken down into roughly five parts; your payment history and how timely you make your payments make up roughly 35% of your FICO score. The total amount you owe to each creditor that reports to the major credit bureaus makes up around 30%. Your overall length of credit history or the amount of time that you have accrued debts reported to credit reporting agencies makes up roughly 15%. The amount of new credit that you have recently opened makes up around 10% of your FICO score and the types of credit that you use such as credit cards, vehicle loans and mortgages make up the remaining 10%. If you are looking at repairing your credit, you need to make sure all of the above factors are taken into consideration before you can begin to resolve low FICO score issues.

Make sure that your payment history is spotless before applying for a loan or a new line of credit. When repairing your credit your how well you have paid your debts in the past is the only predictor to lending institutions of how well you will be paying off future debts.

If your credit card balances are high, you need to work on bringing them down, this is one of the ways you can successfully repair your credit without even doing anything else. Try adding a small amount of even five to ten percent additional to your minimum payment each month, and you will see a fast decrease in your balance at this rate.

Lenders look closely at your overall length of your credit history length and take this into consideration when giving you the interest rate for your loan. If you are looking for a great rate and a low monthly payment, you need to be sure that you have a sufficient credit history. An example of a good credit history length would be a minimum of five years. To repair a weak credit history you will need nothing but time and accounts that remain in good standing.

Have you opened up some new department store accounts lately? Have you bought a new home or vehicle? If you realize that your lenders may be skeptical of your credit, your FICO will keep track of how many new accounts you have, and if you have too many, this could slightly reduce your score. When you need to repair your credit you need to take that into consideration.

There are many key factors that go into determining your overall FICO score. Keeping all of your accounts current and paying bills on time is the ideal way to repair your credit and make it better.