Your FICO Score

March 10, 2010

Credit scores affect whether you can get credit and what you pay for credit cards, auto loans, mortgages and other kinds of credit. For most kinds of credit scores, higher scores mean you are more likely to be approved and pay a lower interest rate on new credit. Here is some advice about the impact on your FICO score of late payments or over-extending yourself.

We all know that making late payments and maxing out our credit lines hurt credit scores, but how much? Recently the folks at FICO, whose scores are used by virtually all lenders, have revealed the actual penalties.

If your FICO score is 680:

  • a 30-day delinquency would drop your score 60 to 80 points
  • maxing out a credit card costs 10 to 30 points
  • declaring bankruptcy lowers it n=by 130 to 150 points
  • a foreclosure costs 86 to 105 points
  • If those same missteps are made by someone who has a FICO score of 780 or above, the reduction in score could be about 50 percent higher.

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