FICO, a predictive analytics company, has launched a new program called FICO Score Open Access for Credit & Financial Counseling, which aims to aid consumers or borrowers with credit management problems through financial guidance, reports Housing Wire.
This new program by the company is expected to help almost one million of its consumers per year, notes the outlet.
In the latter part of 2013, the software company had already launched the Score Open Access program to let the consumers know their FICO scores for free, according to Housing Wire. These scores are important as they are used by lenders such as banks to determine if one would be eligible for a loan or not. Such loans may be home loan, auto loan or credit card.
By knowing one's FICO score, a borrower may be guided in what financial decisions to pursue to get a higher score. High score will improve a borrower's credit-worthiness in the eyes of the lenders. However, doing it by yourself is hard because you would presume what actions to take without the key people guiding you.
Thus, with this new program by the company, consumers will not only receive their FICO scores for free, but they will also receive substantial and relevant advice from "qualified non-profit credit counselors" and government entities, too. Housing Wire notes that FICO will be giving "credit education material" to address concerns from consumers, especially to let them understand how credit scoring works. Furthermore, FICO will also teach them about being wise and responsible about financial management.
For those with low credit scores, here are some tips to improve your scores:
Remember to Pay Your Bills on or Before Their Due Dates
Zillow says that payment history alone accounts for more than one-third of your credit score. Thus, you have to remember to pay on time because late payments reflected on your account will create a big drop on your score.
It would be wise for you to have a list of your payables and their due dates, says the blog. Post some reminders where you can see them like on your journal or a personal calendar. You may also create phone alert to notify you of these important dates, a few days before.
Access Your Credit Report Regularly
The blog suggests for you to review your scores regularly, like every four months, so that you could easily report any deviation or error from the report. If you see any outstanding balance which you already paid, do not hesitate to point it out. Remember that financial institutions and lenders will see these data as such. Not reporting any outdated information will just put you on the losing end. Don't wait till you need to get preapproved for a mortgage loan. Report it as soon as you can.
Use Only 20% of Your Credit Card Limit
According to Forbes, although some lenders ignore FICO scores, 90% of the lenders still use them as their guide. Thus, you might as well follow one tip, the news site states that you should not maximize your line of credit and just use one-fifth of it for a healthy score.
