What is the beacon credit score - find it on line
If you are an American adult then you will likely know all about good and bad credit scores and the most commonly used FICO score. Two of the three big credit bureaus, Equifax and TransUnion, both use the FICO score algorithm when they are calculating credit scores. Equifax uses the Beacon credit score which works a little different to the FICO score. The Beacon score will consider different aspects such as your income, job, debt, credit inquiries and changes of address. So this calculation doesn't only take into consideration the debt part of your status, but it considers other aspects to rate your stability.
Lenders will often request a Beacon credit score when they want to determine how risky it would be to offer you a loan. The score that they receive may play a big factor on the size of loan they will offer and also the amount of interest that they will charge. Credit scores generally range between 300 and 850 with 300 being the worst and 850 the best. The average American will have a credit score somewhere between 600 and 800.
If you are applying for a bank loan then to be approved and to get a good interest rate, you will need to have a credit score of above 750. If your credit score is above 750 then you will save a lot of money by receiving a lower interest rate. Some banks with lower interest rates will want you to have a minimum score of 640 while other banks with mid to high interest rates will give you a loan even if your score is as low as 540. Banks will not always use the Beacon model when basing their decision but they may look at your credit score from all three of the credit bureaus.
Whether you pay your bills on time will account for 35% of your credit score and late or missed payments will have a negative effect on your score. 30% of your score is determined by how much credit you are using in relation to how much credit you have available. So if you have credit cards and they are all maxed out then this will have a negative effect on your credit score, however if your credit cards are not being used so you have all that available credit, then this will have a positive effect on your score. The length of good credit will account for around 15% of your score so the longer you can keep up the good work and pay your bills on time the better it is for your credit score. 10% of your credit score is counted by how much reputable credit you have so when you take out a loan or apply for a credit card always use a reputable financial institution. Do not open too many credit card accounts all at once either as this is a big red flag to lending institutions and credit reporting agencies.
Your Beacon credit score is easily assessable online. There are also a number of sites that have online calculators so you can determine your credit score and try to raise it before applying for a loan. If your score is lower than you expected then it can be beneficial to spend a few months raising your score before applying for a loan, by doing this you will be able to get a better loan with a low interest rate.
TAGS: what is the beacon credit score, beacon credit score, what is my beacon score
Article Source: Messaggiamo.Com
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