There’s a big change coming to your FICO score, courtesy of Fair Isaac, and it hits this summer. Let’s talk about it.
Welcome to Monday Transportation in Minutes. It’s true. There will be a change to the credit scoring system that Fair Isaac Corporation, known as FICO, puts out and it starts this summer. When you pay something late or your slow pay on something or you’re defaulting on something or you’ve had a repossession or a bankruptcy or a foreclosure on your home, you will be dinged harder because of the FICO change. Here are some ways that the change will occur. They’re going to put a greater emphasis on delinquent payments. They’re going to put a greater emphasis on excessive debt, I. E. credit card balances and the word on the street, particularly according to Forbes, who we’ll reference in this video down below, specifically talks about what it’s going to do to the economy because it may hurt you or it may help you. For example, maybe your credit score is actually a little bit lower than it should.
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Well, maybe this algorithm change at FICO might bump your score up. Listen. If you get over a 700 credit score, you’re going to get lower rates. When you go to borrow money, that’s good for you. However, if maybe you haven’t been dinged as much because you’re carrying big credit card balances or you’ve got a couple slow pays from a while ago, you may see your credit score go down and it is being estimated that your credit score might go down as much as 20 points. That’s a big deal. If you’re operating at a 710 and now you go down to a 690 your cost of borrowing is about to change. So, how do you prevent it? Number one, you got to pay your bills on time. Number two, you got to keep your credit card balances low. What is low? Somewhere in the 25% of the balance, so if you have a $10,000 limit, you want your credit balance to be 2,500 bucks or below. You don’t want it to be 7,500 bucks. That’s going to hurt your credit score and then you may actually see an impact on some of your past blemishes. Come back to haunt you a little bit. So let’s take your credit seriously. Let’s make sure that we adjust to the algorithm change and we keep our credit scores over a 700. Stick around for the bonus tip.
Thanks for watching. If you enjoyed this video and it sort of woke you up and you said, boy, I haven’t had my credit looked at in a while, we want to recommend a company called Credit Blueprint. Our friend Carl over at Credit Blueprint is ready to help you fix some blemishes that may be on your credit report. We trust credit Carl, we trust Credit Blueprint and we’re going to give you their link and you can go talk to them about how your credit might be able to get it and keep it in that 700, maybe even the 800 range. So, Credit Blueprint, our friend credit Carl over there is ready to help you. And that’s our bonus tip for the week. We’ll see you down the road.
About Commercial Fleet Financing, Inc.: At Commercial Fleet Financing (CFF), our pros have given smart advice to fleet owners and owner-operators in the transportation, moving, towing or construction industries for more than two decades. With CFF, finding the right financing solutions is a phone call away and most borrowers secure commercial vehicle financing with ease. To talk directly with one of our finance pros and get started with a credit approval in as little as two hours, CFF’s phone number is (469) 281-2962.