How good is your credit score?

A credit score number is often called a FICO score, for Fair Isaac Corporation, the California company that developed the system upon which it is based. The score is supposed to distill all the information in your credit report, using a formula to calculate a single number that indicates your credit worthiness. It's designed to give creditors a fast and accurate prediction of the risk involved in providing you a loan.

According to Fair Isaac the median score is 723 whereas according to Experian (using the Fair Isaac risk model) the average credit score is 678. Each individual has three diifferent credit scores because the three credit agencies have their own, independent databases. As these databases are independent of each other, they may contain entirely different data. Many lenders check an applicant's score from each bureau and use the median score to determine the applicant's credit worthiness.


0-500 -Poor

500-700 -Avg

(500-580 -Bad

580-620 -Low

620-680 -Satisactory

680-700 -Good)

700+ -Excellent

Certain credit lenders may offer better rates and/or discounts if your score is over 720.

Your Credit card pays your rental car insurance

When you rent a car , do you know that you might not need to buy insurance from the rental company because probably the credit card that you have used to rent the car already provides you with the insurance coverage required to protect the rental car. Not many people know this. So they end up paying unneccesarily for the insurance that they do not even require in the first place. If you have more than one credit card, call up all your credit card companies to find out if they provide you with this feature. So next time you need to rent a car, you would know which credit card to use to rent it.

Credit check for costco membership?

Recently I was asked by someone if there is a credit check for Costco membership. Well, the answer is that you can easily get Costco membership as long as you pay the $50 for the membership fees, even if you have no credit history. Even I got the Costco membership without any credit history. But if you apply for the free American Express credit card offered along with the Costco membership, they will definitely pull up all the three credit reports, and this will be a hard credit enquiry which will last for two years on your credit report.