Credit-Rating Clout

According to a recent article, Credit-Rating Clout featured on Forbes.com people have become increasingingly dependent on credit, however, few people know how credit ratings or credit scores are determined. This information is crucial to the debter though, because a difference in credit rating makes all the difference when purchasing a home. The credit score determines the likelihood that an individual will pay back the money he has borrowed. According to the article, "The primary factors used to calculate an individual's credit score are his or her credit payment history, current debts, length of credit history, credit-type mix and frequency of applications for new credit." An individual's FICO score, a term often used interchangably with credit score, is crucial to the amount he will pay monthly for a mortgage. The lower the individual's FICO score, the higher the risk and the more likely that individual will not pay his debts.

Read Credit-Rating Clout on Forbes.com for more information concerning credit ratings
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