BUILDING OR REBUILDING YOUR CREDIT
“FY-koh”) actually stands
for Fair Isaac corpora-
tion., the company that
developed the FICO
score. Find out more
about FICO at
their web site,
Why is Good Credit So Important?
If your financial goals include major purchases, you’ll probably need to take out a loan.
Most people don’t have $100,000, or even $15,000, at one time, so instead, we
borrow the money, and pay it back over time.
Your lenders are interested in one thing: how reliably you will pay them back—your
financial future. Your financial history shown in your credit report helps lenders
judge your future. Your credit report may determine whether you can get a loan,
and how much the loan will cost you.
If you’re worried that your financial history doesn’t really reflect what you believe your
financial future looks like, just remember this:
Your financial future begins today.
You can’t erase the past, and your past can remain on your credit report for years. But, you
can demonstrate good habits starting today that can show lenders that your financial future
is a bright one.
Why is Your Credit Score So Important?
● It’s used by lenders, insurance companies and even potential employers and landlords, to
help them determine whether you are financially responsible.
● When you’re opening new accounts (even phones or utilities) a bad credit report can
meant that you will have to make a large deposit in case you stop paying your bill.
● A bad credit score indicates that you are more risky that other potential borrowers.
This can lead to:
● Higher Fees and Rates
● Being declined for new accounts
● No credit line increases
● Being rejected for jobs or apartments or insurance
How a good FICO score
can save you money:
The higher your score, the less you may
be charged for a loan. See this example
of the monthly payments on a 48-month,
$10,000 used car loan. If your score is
below 590, you ma