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Farm Bureau Bank News Your FICO® Score Is Not Just Any Number
Understand how lenders evaluate your credit risk

June 20, 2017

FICO® Scores are numbers that summarize your credit risk. Scores are based on a snapshot of your credit file at particular consumer reporting agency at a particular point in time, and help lenders evaluate your credit risk. FICO® Scores influence the credit that's available to you and the terms, such as interest rate, that lenders offer you.

According to FICO, when evaluating your credit risk, the items that lenders generally pay the most attention to are:

  • Your FICO® Score
  • Your payment history – to see if you have paid your bills on time
  • Your current debt – to see if you are able to reasonably take on more debt
  • Whether you have had any collection accounts
  • Any public records, such as bankruptcies, judgments and liens
  • The types of financing you have successfully managed
  • The length of your credit history
  • Recent activity, including new accounts and credit inquiries by other lenders
  • Your income – to determine your ability to make required payments

Based on this information, a lender will decide whether to approve or decline your credit application. If they approve it, they will set your credit terms, such as interest rate, credit limit and down payment requirement.

Check Your Credit Report for Errors:

It is very important to make sure that the information in your credit report is accurate. Your credit report contains important information, such as your:

Personal Information: Name, address, Social Security number, date of birth and employment information. This information updates from information you supply to your lenders.

Credit Accounts: The type of accounts you have opened (credit card, auto loan, mortgage, etc.), the date you opened the account, your credit limit or loan amount, the account balances, and your payment history.

Requests for Credit: When you apply for a loan, you authorize the lender to ask for a copy of your credit report. This is how inquiries appear on your credit report. Inquiries are listed within the last two years.

Public Record and Collection Items: The type of accounts you have opened (credit card, auto loan, mortgage, etc.), the date you opened the account, your credit limit or loan amount, the account balances, and your payment history.

What is an Inquiry, according to FICO®? When you apply for credit, you authorize those lenders to ask or "inquire" for a copy of your credit report from a CRA. When you later check your credit report, you may notice that their credit inquiries are listed. You may also see listed there inquiries by businesses that you don't know, such as lenders who have mailed you a credit card solicitation. The only inquiries considered by FICO® Scores are the ones that result from your applications for new credit.

Public Record and Collection Items: Information on overdue debt from collection agencies and public record information such as bankruptcies, foreclosures, tax liens, legal suits and judgements from state and county courthouses.

Plus, one of the best ways to protect yourself from fraud or identity theft is to know what's on your official credit report. Your credit report has sensitive personal information and it's important to make sure all information found is accurate.

Check Your Credit Report for Errors:

If you are a Farm Bureau Member Rewards MasterCard® primary cardholder, you can now view your FICO® Score within your Online Banking account. Each month, your most recent FICO® Score will be updated allowing you to keep an eye out on your score regularly. In addition, this new benefit will also include:

  • Free, unlimited online access to your FICO® Score
  • Key factors that affected your FICO® Score
  • Educational content on FICO® Scores and financial health
  • And more!

Check your FICO® Score out today by logging in to your Online Banking account, or call a Customer Care Representative for assistance at 1-866-644-2535, anytime!

Interested in a Farm Bureau Member Rewards MasterCard? Contact your local agent to apply today!

 

FICO is a registered trademark of Fair Isaac Corporation in the United States and other countries.




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* Rates disclosed as Annual Percentage Rate (APR) and Annual Percentage Yield (APY). Farm Bureau, FB, and the FB National Logo are registered service marks owned by, and used by Farm Bureau Bank FSB under license from, the American Farm Bureau Federation. Farm Bureau Bank FSB is a service-to-member institution which provides banking services to Farm Bureau members and others in participating states. Services are not available in the following states: IL, KS, MI, MO, NY, OH, and WY.