Credit Improvements Enhance Loan Leveraging

Physician's Money Digest, December 2005, Volume 12, Issue 16

FDIC Consumer News

It doesn't matter how much money youmake or how successful you appear tofriends and family. Without a clean creditreport and a good Fair Isaac CreditOrganization score, or FICO as most of usknow it, your chances of obtaining a loan orcredit card with a great rate will drasticallydiminish. In short, the higher your score,the better your chances are of securingwhatever financial line of credit yourheart desires. But if your score is below620, considered fair on a scale of 375 to900 and a credit risk to lenders, do notfret. According to ,even a moderate improvement in your credit,such as paying down high balances andcorrecting errors on your credit report, canincrease your credit score enough toimprove financial offers. For example, if amortgage lender requires a credit score of680 or higher, and you are teetering ataround 660, taking the steps to improveyour score even 20 points can potentiallysave thousands and thousands of dollarsover the course of a 30-year mortgage.Want to check your score? The Federal TradeCommission has decreed that every US consumercan request a free credit report fromeach of the three credit reporting agenciesonce every 12 months. To obtain your freereport, contact Equifax (800-685-1111;www.equifax.com), Experian (888-397-3742; www.experian.com), or TransUnion(800-916-8800; www.transunion.com).