Assemble, budgeting bushido! I, Jeremy, am sporting my pointy hat and fu manchu in preparation to bestow upon you, Grasshoppa, some basic techniques in the ancient art of FICO defense.
[Wooden flute plays while I balance atop my bamboo cane.]
The terms “FICO” and “credit score” are essentially the same creature and those terms are interchanged by bankers, since FICO is the company many use to get your credit report. Despite your or my feelings about it, your FICO…is. Though shrouded in mystery, since it can work either for or against you, it is wise to study its ways. Let us begin…
If it is a mortgage you seek, you must face your FICO since banks employ it heavily in guiding their lending decisions. If married, you will not face it alone (though you may wish you could if your spouse has been tiger-style with their borrowing, yet sloth-style in paying back.)
FICO has no feelings about your borrowing history. FICO does not hear sincere reasons, nor poor excuses. It peers unbiasedly through you and gives you a score ranging from 300 to 850, with higher being better. Like middle-aged man’s abs, building your score up is long and difficult, while sagging is quick and easy.
FICO sees only darkness. FICO will not mention the time you ate only wild beetles, drank dew droplets, and lived without electricity to pay off your 30 year mortgage in seven grueling months. FICO will, however, point out the time you spent forty days meditating on Youtube cat videos and were late on paying your Target card…five years ago.
Let not your anger control you, Grasshoppa. Neither be seized by worry if you are now trying to remember every little thing you may have ever done wrong. The best course of action is to bring your FICO into the light. Journey to www.AnnualCreditReport.com where you can request your credit report once per year without charge.
[There are many sites (even some banks/credit cards) which offer this service for a fee. Unless you want to monitor your credit score more than annually, this is letting your money take the way of the cherry blossom in the wind.]
Like waxing car and painting fence, checking your score is more than going through the motions since they are not always accurate. Be not intimidated! FICO will back down when confronted with good evidence of payment sent on time. Even a sincere call to the company reporting a genuine late payment may suffice. “Hello, friendly cell phone carrier person. I see I had a late payment last year. I was unconscious due to a nunchaku-induced head injury, but I paid as soon as I woke up and was never late otherwise. What might I do to clear that up?” It might do the trick, if it is the honest truth.
Many an unwary mortgage shoppa has been bitten in the backside by FICO and thus denied in their quest. When next we meet, I will teach of the anatomy of the FICO, and how to avoid those attacks. I will offer you further techniques, but they will be more valuable to you once you have seen your credit report with your own eyes.
That will be all for now, enlightened one. Now go and find what it is you seek.