IMPORANT CHANGES IN THE WAY YOU ARE SCORED
September 8, 2009 by Eleanor
Filed under About Scores and Credit, Score Strategies
There are some misconceptions that if you look at your credit report, and there’s a missed payment 2 years ago – you should write a dispute letter. I wouldn’t be so fast to do that.
With the newest version of the FICO credit-scoring system, some minor delinquencies are now overlooked in calculating creditworthiness.
Under the updated scoring model, called FICO 08, small, missed payments lingering in collections with original amounts of $100 or less will no longer do damage to your credit score. Consumers also are less likely to be penalized for any single delinquency if it occurred two or more years ago-and if their credit history is otherwise unblemished, says FICO, formerly Fair Isaac Corp…. which developed the FICO scoring system.
“There’s more flexibility with missing a payment,” said Careen Foster, director of global scoring product management for FICO. “If you have a more habitual pattern of paying accounts late, you’re more likely to get penalized for that.”"If a consumer’s credit usage is high, that will be more likely to hurt his or her score with FICO 08. But getting close to your credit-card limits-even if you always pay on time-is penalized in some way in every FICO score, not only the recent edition,” Foster said.
If you are considering purchasing a home in NC, and have questions about your how to improve your bad credit, call Steve Thorne, 919-649-5058 – we really know how to help folks purchase a home!
WoW! Thank you very much for that enlightening article
You’re the best! Take care.
I really like your blog and i respect your work. I’ll be a frequent visitor.
Hmm… I read blogs on a similar topic, but i never visited your blog. I added it to favorites and i’ll be your constant reader.
Are you a professional journalist? You write very well.
Very interesting and amusing subject. I read with great pleasure.
In truth, immediately i didn’t understand the essence. But after re-reading all at once became clear.
Thank you! You often write very interesting articles. You improved my mood.