Beacon scores are the score given to you by the credit collection companies, Equifax and Trans Union, and are built by grouping data into predictive characteristics in five categories. These scores are used by financial institutions and credit companies in order to determine your credit worthiness.
Past Payment Performance = 35%
• The fewer late payments, judgments, liens, or collections, the better.
• Recent late payments weigh more than those made two years past.
Credit Utilization = 30%
• Low balances on several cards are better than high balances on a few cards.
• Balance should be at or below 30% of the available credit.
• Too many cards can be a detriment.
Credit History = 15%
• The longer accounts have been open and in good standing, the better.
• Avoid ‘credit surfing.’ Opening new accounts and closing established accounts will negatively impact on a credit score.
Types of Credit in Use = 10%
• Finance company accounts score lower than traditional banking or retail accounts.
• Deferred payment options funded by finance companies impact the score accordingly.
Inquiries = 10%
• Looking for new credit over a short period of time can be indicative of higher risk.
• Promotional or administrative inquiries (i.e. credit grantor updates) will show on the report but do not affect the credit score.
Past Payment Performance = 35%
• The fewer late payments, judgments, liens, or collections, the better.
• Recent late payments weigh more than those made two years past.
Credit Utilization = 30%
• Low balances on several cards are better than high balances on a few cards.
• Balance should be at or below 30% of the available credit.
• Too many cards can be a detriment.
Credit History = 15%
• The longer accounts have been open and in good standing, the better.
• Avoid ‘credit surfing.’ Opening new accounts and closing established accounts will negatively impact on a credit score.
Types of Credit in Use = 10%
• Finance company accounts score lower than traditional banking or retail accounts.
• Deferred payment options funded by finance companies impact the score accordingly.
Inquiries = 10%
• Looking for new credit over a short period of time can be indicative of higher risk.
• Promotional or administrative inquiries (i.e. credit grantor updates) will show on the report but do not affect the credit score.
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