2. 2 What Does it Mean?

3. Determine how much money you can borrow, and how much interest you’ll pay. Each score is specific for each bureau Scores range from… – 300 to 850 for Classic FICO – The higher the score the lower the risk The score is generated by analyzing the information contained in the consumer’s credit report at a particular point in time 3

4. Equifax – BEACON® Score Experian – Experian/Fair Isaac Risk Model TransUnion – EMPIRICA® 4

5. Vantage Scoring Model – Unveiled on march 14 2006 – Driven by the Big 3 – Score range from 501-990 – Scores Combine a letter to the Score: A: 900–990 B: 800–899 C: 700–799 D: 600–699 F: 501–599 In 2013 adopted the 300-850 range

6. Plus Score – Developed By Experian Decision Analytics – Ranges from 330 – 830 – Used primarily for consumer reports Trans Risk Score – Developed By Transunion – Ranges from 300 – 850 – Used primarily for consumer report

8. 8 Consumer Default: What are the Odds?

9. 9

10. 10 FORGET IT!

12. 12

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15. 15

16. 16 What are the determining factors?

17. 1. Payment history 2. Amounts Owed 3. Length of credit history 4. Types of credit in use 5. New credit 17

18. 18 35% of Credit Score Credit Score

19. Many types of accounts are considered for payment history – Credit Cards – Retail Accounts – Installment Loans – Finance company accounts – Mortgage loans Public record and collection items are considered quite serious 19

20. FICO® Score considers this details on the accounts: – How late they were – How much was owed – How recently they occurred – How many there are Good track record on credit accounts will increase FICO® Score 20

21. 21 How long do delinquencies stay?

22. Bankruptcies – Chapter 7, 11 & 12 10 Years from filing date – Chapter 137 Years from the date paid, and 10 years if not completed Paid Tax Liens* 7 Years from date released (paid) (For California State Residents Only: or 10 years from the date file) Unpaid Tax Liens Remain on file indefinitely (For California State Residents Only: 10 years from the file date) Late Payments 7 Years 22

23. Charge-offs 7 Years from 1st late pay Judgments 7 Years from the date filed (For NY State Residents only: 5 years from the date filed) Collections 7 years from the initial missed payment that led to the collection (For NY State Residents Only: 5 years from the date of last activity) Inquiries 2 Years 23

24. 24 30%of Credit Score Credit Score

25. Amount owed on all accounts Amount owed on specific types, such as credit cards and installment loans. How many accounts have balances How much of the total credit line is being used and other “revolving” credit accounts How much of the installment loan amounts is still owed, compared with the original loan amount 25

26. 26 15%of Credit Score Credit Score

27. How long your credit accounts have been established, including the age of your oldest account, the age of your newest account and an average age of all your accounts How long specific credit accounts have been established How long it has been since you used certain accounts. 27

28. 28 10%of Credit Score Credit Score

29. The score will consider your mix of credit cards, retail accounts, installment loans, finance company accounts and mortgage loans. People with no credit cards tend to be viewed as a higher risk than people who have managed credit cards responsibly. A closed account will still show up on your credit report, and its history will be considered by your FICO Score. 29

30. 30 10%of Credit Score Credit Score

31. It’s OK to request and check your own credit report Don’t open new accounts to rapidly How many recent inquiries you have Length of time since credit report inquiries were made How long it’s been since you opened a new account 31

32. 1. Payment history 2. Amounts owed 3. Length of credit history 4. Types of credit in use 5. New credit

33. 33 Now you know!