wasim tariq 
The credit score is a rating between 300 and 850 points that is use to determine the probability that a person will pay a debt within the establish term. In the United States, a country whose economy is based on credit, the credit score is one of the most important data of any person.
What you should know about your FICO credit score
- The FICO credit score is a score between 300 and 850 points. From 670 the score is consider good, and from 800, excellent.
- This qualification is taken into account when applying for credit cards, mortgages, insurance, car loans, and even opening accounts for utilities and cell phones.
- To improve your credit score, you must maintain active credit cards with a balance below 30 percent of the credit limit, in addition to paying all debts on time.
- Once a year, everyone is entitled to a free credit report from each of the three major credit bureaus.
- As of February 24, 2020, migrants applying for adjustment of status must provide their credit score, except asylees, refugees, TPS and other vulnerable migrants.
- The new form I-944 allows denying adjustment of status due to public charge and takes into account credit, bankruptcies, age, knowledge of English, income, receiving public benefits or requesting not to pay immigration fees.
The credit report is a compilation of information about how a person handles their credit and debt. It includes how much you owe, where you work, how you pay your debts, where you live, if you have filed for bankruptcy, if you have had a home foreclosed, judgment for non-payment, a car repossession, etc. From the credit report prepared by one of the credit bureaus, FICO determines the credit score.
How does the FICO credit score affect you?
The FICO Score can affect a wide variety of financial situations. Below we detail the most frequent.
Credit card application
The credit score determines if the request is approved and the interest rate that is applied to you. The lower the FICO credit score, the higher the interest.
Rent housing
Large real estate companies use the FICO score to approve or deny a rental application. People without good credit are limited to renting from small companies or individual owners.
Car insurance
Insurers depend on the insurance score (insurance score, in English) to decide whether to insure a driver and the cost of the policy. One of the factors that make it up is the driver’s credit history, along with his previous accident and insurance history.
Cell phone bills and public services (utilities)
Some companies that provide telephone, electricity, water or cable services use the credit score to determine if they require, as a condition of providing the service, the payment in advance or the consignment of an amount in deposit. Also the cost of the service may be higher.
Your credit history and job opportunities
No company can deny a person employment because they have a low FICO number. However, you can decide not to hire a candidate if you believe that they have an unacceptable credit history. This record for work purposes, known as a business credit report, contains data, for example, how much obligation for contracts, understudy loans, vehicles, charge cards, and so forth and installment history. However, it does not include the FICO score. In 11 states, this practice of credit reporting is prohibit without the express consent of the person who aspires to the job.
What is a good FICO score?
The FICO credit score ranges from 300 to 850 points and is govern by the following guidelines to determine how good it is:
- Less than 300: no credit history or less than 6 months
- 300–579: poor
- 580–669: fair
- 670–739: good
- 740–799: very good
- More than 800: exceptional (exceptional)
As a general rule, credit applications are approved for people with a good rating or better. The very good or exceptional usually entails, in addition, a lower interest rate. Because credit scores affect people’s financial and everyday lives, having a good FICO score makes life in America easier.
How is the FICO credit score created?
To determine what a person’s FICO score is, the following factors are computed and given different weights.
Credit history is the most important factor, accounting for 35 percent of the total FICO score. They negatively affect late payments, unpaid debts recovered by a collection agency, foreclosures, bankruptcy declarations, etc. The most recent problems have greater weight than those that occurred years ago.
The level of debt makes up 30 percent of the FICO score. It is the amount of debt a person has compared to their credit limit. It is recommend to keep your credit card balance below 30 percent of your limit.
Length of credit history is 15 percent of the FICO score. For this reason it is advisable to keep the oldest credit accounts open and continue to use them.
The number of requests to check a person’s credit is 10 percent of the FICO score. In English this is known as Inquire, and for FICO only those relate to applications to request a new credit (known as hard inquire) are take into account. Only those made in the last year are compute, although they remain on the credit report for two years.
Ultimately, the different types of credit you have make up 10 percent of your FICO score.
