Most people are curious about their FICO rating and wonder how it is calculated. The exact formula for calculating this rating is not known. However, an online credit score simulator will give you a great estimate of what your score is. Everything that the financial bureaus use to determine your FICO is on your actual free online credit report. Therefore, if you have a copy of the report, you have all of the information needed to get your rating. The Fair Credit Transactions Act was passed and allows people one free copy of their report each year. One can be requested from Equifax, Trans Union and Experian. Each one of these agencies will provide you with a free report, giving you three reports.
After you obtain your copies, you can successfully use a score simulator to determine your FICO. You will first put in the requested information. It is important to make sure that the information that you are entering is accurate so that you can receive the most accurate results. The simulator will give you an approximate rating based on the information that you have entered. The score is not 100% accurate, but you will find that if you compare the number given on the simulator to your actual FICO, the numbers will be within the same range. You should not take this information to a financial institution or a bank requesting a loan or credit. This tool is for personal use, and is designed to give individuals an idea of their financial worthiness.
After you obtain your copies, you can successfully use a score simulator to determine your FICO. You will first put in the requested information. It is important to make sure that the information that you are entering is accurate so that you can receive the most accurate results. The simulator will give you an approximate rating based on the information that you have entered. The score is not 100% accurate, but you will find that if you compare the number given on the simulator to your actual FICO, the numbers will be within the same range. You should not take this information to a financial institution or a bank requesting a loan or credit. This tool is for personal use, and is designed to give individuals an idea of their financial worthiness.
All of the three reporting agencies use a formula similar to the score simulator. Have you ever noticed that each of the reporting agencies have a different number for your FICO score? This is because they all use different variables. While your results may show 660 at Experian, it may be 668 at Equifax and 640 at Trans Union. It is rare that the numeric results match. Score simulators also provide feedback as well on how you can actually improve your finances. This is an additional benefit that can be a great way of learning specifically what you can do to improve your score based on your current rating. Simulators will also allow you to play with the data allowing you to view how certain actions will affect your score. Online score simulators are great tools for finance management. They are very useful and are available to anyone with access to the web.
Credit reports are pointers to your credit worthiness. It gives information about your credit history - past and present loans from various sources and payments made late payments and payment dues to the creditors. From the free online credit report, the credit score is derived. The credit report is the basis on which you will be able to apply for various loans. The better your credit report, the better chances you will have of getting a loan. A good credit report will always fetch better loan amounts, lower interest rates and easier payment options. From a personal point of view, a credit report can help you to keep an eye on where you stand as regards to your credit situation.
Credit reports are pointers to your credit worthiness. It gives information about your credit history - past and present loans from various sources and payments made late payments and payment dues to the creditors. From the free online credit report, the credit score is derived. The credit report is the basis on which you will be able to apply for various loans. The better your credit report, the better chances you will have of getting a loan. A good credit report will always fetch better loan amounts, lower interest rates and easier payment options. From a personal point of view, a credit report can help you to keep an eye on where you stand as regards to your credit situation.
Having stated the importance of a free online credit report, let us look at how to get totally free online credit reports. According to Fair and Accurate credit transaction Act, the three top credit agencies in the USA Experian, Trans Union and Equifax are obliged to provide free credit reports to those who seek them within a period of 12 months. The act has been enacted to ensure that every American knows what reports the credit bureaus are providing about him. It is also a measure to curb the increasing identity thefts and errors in the reports. So, getting your credit report periodically and manning it for errors and omissions has been made easy now.
