Recently, FICO (The consumer credit score used by more than 90% of lenders use to make lending decisions) announced a new pilot program in which the 12 largest credit card issuers in the United States would be allowed to use alternative data to identify credit worthy individuals or borrowers who would unlikely be able to obtain traditional credit.
Bad credit is a consumer with a FICO score below 600. If you have a poor track record of paying your bills on time in the past you may have a difficult time of securing credit cards, auto loans and home mortgages. The change will incorporate new data into the formula for your credit score using payment data from your phone, cable, electric and gas bills. FICO’s new credit program is designed to help those with limited credit history to obtain a credit card so that they can continue to rebuild their credit history.
A consumer with a bad credit score needs to set out a path repair and to rebuild their credit. Part of this process is to review your credit report. Fixing your credit is more than just about fixing your credit score. It is about repairing the errors so that your credit is a true and accurate reflection of your credit history. Every error, outdated and incomplete account history should be carefully reviewed, verified and corrected. It requires diligence and thoroughness in order to get the job done correctly. Inaccurate, unverifiable and incomplete information must be deleted, removed, updated or re-characterized by the credit bureaus and creditors.
The new FICO credit program is a great benefit to those consumers with bad credit who would like to rebuild and get their credit back on track. It will help consumers obtain credit card(s) and establish a good payment history. When you are rebuilding your credit remember to pay all of your bills on time, keep your credit card balances low or pay them off every month. All of the good you do for your credit will help it to grow and improve and it will reward you in return with a solid credit history and a great credit score.