04-23-2010 07:21 PM
What’s hurting your FICO® score
The negative factors listed here are reasons why your FICO® score is not higher. You should focus on changing the behavior that caused these negative factors. These factors are listed in order of their impact to your score, the first has the greatest negative impact and the last has the least.
Please note that a negative factor can be provided even if you are better than the national average on that factor. This means that there is still some room to work on this factor.
You have a public record or collection, as well as a serious delinquency on your credit report.
The presence of a public record [?] (such as a bankruptcy or tax lien) or a collection [?] as well as a serious delinquency are powerful predictors of future payment risk. If these are valid, satisfying the public record or paying off the collection will not remove it from your credit report. The fact that it occurred is still predictive of future payment risk and will be considered by your FICO score. However as the items age and fall off of your credit report, their impact on your score will gradually decrease. Most public records, collections and delinquencies stay on your report for no more than seven years - though there are certain items that could remain longer. Only about 1% of FICO High Achievers [?] have a 60 days late payment or worse listed on their credit report.Virtually no FICO High Achievers have a public record listed on their credit report.Virtually no FICO High Achievers have a collection listed on their credit report.
Reason Code: 38
You've recently been looking for credit.
Each time you apply for credit a credit inquiry is added to your credit report. Your credit report shows recent credit inquiries, which indicates that you've recently been seeking credit. People who are actively seeking credit pose more of a risk to lenders than those who are not. Your FICO score was lowered due to the number of credit inquiries performed within the last 12 months. Your FICO score will consider these recent inquiries less as time passes, provided no new inquiries are added.
Note that your FICO score usually identifies when you are rate shopping for a mortgage, auto or student loan and treats those multiple inquiries as a single inquiry.
Keep this in mind: As a general rule, if you don't need or plan to use credit, don't apply for it.About 72% of FICO High Achievers [?] did not apply for credit in the past year. Of those that did, about 20% applied for credit just once.
Reason Code: 8
You have a consumer finance account on your credit report.
Consumer finance companies typically grant loans to people with poor credit histories. Their customers often cannot get loans from traditional lending companies such as banks or credit unions. These are often high-interest loans because the consumer finance company is assuming more risk by lending to people with less than perfect credit.
The fact that you have a consumer finance company loan on your credit report means that you represent a higher risk to lenders than someone with no consumer finance loans. Even if this consumer finance account is closed, it will still lower your FICO score. However, its impact on your score will lessen as time passes.
What to do about this: You should try to stay current with all of your payments and avoid opening any new credit accounts that you don't need.Only 12% of FICO High Achievers [?] have a consumer finance account.
Reason Code: 6
You have a short credit history.
Your FICO score measures the age of your oldest account and the average age of your accounts. In your case, either your oldest account was opened recently or the average age of your accounts is relatively low. People that do not frequently open new accounts and have longer credit histories generally pose less risk to lenders. Therefore, as your credit history lengthens and you pay your bills on time, this factor should have less of a negative impact on your score. FICO High Achievers [?] opened their oldest account 19 years ago, on average.Most FICO High Achievers have an average age of accounts between 6 and 12 years.
Reason Code: 14
So far it looks good on the post message screen - we'll see what happens after I hit "Post". Cross everything!
04-23-2010 07:30 PM
So far, so good.
And this is what people hate about myfico.com/12 - the scale that cheers you up with positive items is gone (that's because it's just a nice-nice - there are only negative FICO codes) and you'll always see this:
What’s helping your FICO® score
Since your FICO® score is not good, there are no positive factors that we can list which are helping your score.
When I first saw this I kind of flipped out. But now I know what to expect - always four negative reasons (the same four FICO codes your lenders see when they pull your credit report) and always no positive reasons. (Again, the positive side of the scale is a nice-nice myfico does to help us cheer up and also to know what we're doing right - they are never part of a lender initiated credit pull). So on myfico.com/12 you are seeing the same (always 4) FICO reason codes the lenders see.
Also, if you do pull myfico.com/12, your reports are available on myfico.com for about a year or so - you can always go back and pull them up.
Hope that helps!
04-23-2010 08:13 PM
you know, this is worth buying a fico98 for. i'm curious. i wonder why i didnt get this type when i ordered before from /12? thank you so much for posting this! that was kudos worthy.
myFICO is the consumer division of FICO. Since its introduction 20 years ago, the FICO® Score has become a global standard for measuring credit risk in the banking, mortgage, credit card, auto and retail industries. 90 of the top 100 largest U.S. financial institutions use the FICO Score to make consumer credit decisions.>> About myFICO