Are banks the only ones looking at my FICO score, and do they have to pay the same fee I do?

No and no. The sites show a scale of interest rates for different types of loans, but did you know that your insurance agent also uses an insurance score to help determine your premiums? The Fair Isaac Company developed the first insurance scoring model in 1998 and there have been some updates since then. Concrete information on this subject is very sketchy, but my personal insurance agent told me that home owners' policies cost up to 40% more if your credit is in the toilet, but vehicle insurance premiums more than double with bottom-of-the-barrel credit scores. I asked if I could get a table with this information and was told that I couldn't. Farmer's Insurance is not using the FICO score specifically, but they do have a score-based model that uses credit report data.

Employers are relying more on credit scores for hiring decisions and for promotions, but it doesn't stop there. Many utility companies will require a deposit prior to connecting service and some are using your credit score to determine your kilowatt/hour RATE! Just imagine, you might be paying more for electricity soon based on a low credit score.

I'm sure that no one is surprised to find that banks and insurance companies pay a fraction of what you pay to get the same information. On Myfico.com you will pay $15.95 to get FICO Standard, which only provides scores and bureau information for Equifax and Trans Union. Due to an on-going law suit between Fair Isaac and Experian, you cannot purchase your Experian FICO score at Myfico.com. As a national mortgage lender, we can purchase all three FICO scores with the matching bureaus for $9.86. I'm sure the big banks get an even better discount.

What version of FICO is being used to generate my score?

Remember when Microsoft's Windows '95 was getting all the press? Since then there have been a multitude of newer and better versions of the operating system, and right now Microsoft is promoting Windows 7. FICO is nothing more than a software algorithm that crawls through the data on your credit report; much the same way as Google will crawl through web sites looking for content. The purpose of the FICO software is to try and predict your chances of defaulting on future debt obligations within the next 2 to 3 years. So how many versions of FICO are out there?

At least three that we know of. Until recently, the mortgage industry was able to use a version written back in 1998. This was only available for the data contained in a Trans Union report, but nevertheless, there were instances when the 1998 version gave you a higher Trans Union FICO score, and those 5 to 10 points were sometimes the difference in getting a loan.

Most banks using FICO are using the version created in 2004, which is commonly referred to as FICO Classic. The Fair Isaac Company is aggressively promoting the newest version of FICO which has been dubbed FICO '08.

Important Information To Check In your Credit File

Most people focus exclusively on the negative trade lines reporting on their credit file.

The following is some other important data that should be considered as well, courtesy of MSN:

Are your employer and your job title listed? If you've had the job less than two years, your previous employer and job title should be listed as well.

Is your address listed and correct? If you've been there less than two years, is your previous address listed as well?

Is your Social Security number listed and correct?

This is the way most lenders will identify you.

Is your telephone number listed and correct? Many lenders may not extend credit if they can't call you to verify information.

Does your report include all the accounts you've paid on time? Some lenders don't report regularly to credit agencies, and some report to only one or two, rather than all three.

You can ask the creditor to report the account to an agency that doesn't list it. If the creditor refuses or doesn't respond, you can send a letter to the agency with a copy of your latest statement and canceled checks to prove you've been paying on time.

Financial Empowerment Network Team and Prime Financial Credit Services

Credit and Debt Terms to Know

APR

The annual percentage rate, or APR, is the interest rate charged on the amount borrowed. It is the annual cost of borrowing money. APR makes it easier to compare different loans and credit cards, because you can easily see which loan/credit card would be cheaper. There are two different types of APRs. The nominal APR is the interest rate that's stated on a loan. The effective APR includes fees that have been added to your balance.

Balance Transfer

A balance transfer is the process of moving credit card debt from one credit card to another. Balance transfers are subject to a balance transfer fee that's a percentage (usually 3-6%) of the amount being transferred.

Billing Cycle

The billing cycle is the period of time between billings. It may start on the 1st day of the month and end on the 30th day. Or, it may go from the 15th of the month to the 15th of the next. Billing cycles are varying lengths, ranging from 25-45 days, depending on the credit card and issuer. During the billing cycle, purchases, credits, fees, and finance charges are posted to your account. At the end of the cycle you are billed for all charges and fees made during the billing cycle. Your credit card payment is 20-25 days after your billing cycle ends. The period of time is known as the grace period.

Credit Limit

A credit card limit is the maximum amount that can be borrowed on a credit card without a penalty. Exceeding your credit limit results in an "over the limit fee". Your credit card issuer might also raise your interest rate to the default rate if you go over your credit limit. The default rate is the highest rate charged by a creditor or lender, usually as a penalty for missing a payment or exceeding the credit limit. Exceeding your credit limit or even getting clost to it impacts your credit score. Your credit utilization measures the amount of your credit limit that's being used and counts 30% of your credit score. The higher your credit card balance, the lower your credit utilization and the more your credit score is hurt. It's best to keep your credit card balances within 10% to 30% of your credit limit.

Keith Dienstl is a member of the Financial Empowerment Network Team and Prime Financial Credit Services you can also visit Credit Repair Services for more information on Keith Dienstl.

New Rules Issued by the Federal Reserve and Federal Trade Commission about Consumer Credit

Consumers taking out auto, home mortgages, credit cards and other types of loans will be notified when they are offtered an interest rate that is higher than is customary due to their poor credit histories. This is under new rules issued on 12/23/09 than become effective on Jan., 1 2011.

Lenders traditionally offer borrowers rate and terms based on their credit reports, which reflects the borrowers' ability to repay the loans. This is called "risk-based pricing."

The new rules set forth by the Federal Reserve and the Federal Trade Commission entitle borrowers who receive pricing notifications to also be entitled to a free credit report to check the accuracy of their credit report.

Borrowers will be notified about the higher interest rates "after the terms of credit have been set, but before the consumer becomes contractually obligated on the credit transaction," according to the rules.

This notification is required when the lender - based on the borrowers' credit report - offers credit terms "that are materially less favorable" than the terms offered or provided to other consumers, the regulators said.

Lenders will not have to provide this notification if they offer borrowers a free credit score, Federal Reserve attorneys explained. A consumer must normally pay a fee - between $8-$11 - to obtain their credit scores, the attorney said. Credit reports don't contain credit scores, they said.

This provision, announced yesterday, is aimed at helping borrowers better understand the rates they are being offered on particular loans and to get more information about their credit reports.

Keith Dienstl is a member of the Financial Empowerment Network Team and Prime Financial Credit Services you can also visit Credit Repair Services for more information on Keith Dienstl.

Mistakes and Other Inaccurate Information

Mistakes and other inaccurate information on your credit report aren't your fault and in a perfect world, wouldn't affect you.

Our world is not perfect, however, and while you may not be responsible for some or all of the questionable items on your credit report, you are probably being held accountable for them.

The Fair Credit Reporting Act gives you the right to contact credit bureaus directly and dispute items on your credit reports. Just as in a court of law, you have the right to plead "not guilty" to questionable information on your credit reports, and leave the burden of proof to the credit bureaus.

You can dispute any and all items on your credit reports that you feel classify as inaccurate, unverifiable, or misleading. If the bureaus can not verify that the information on your reports is indeed correct, then those items must be deleted.

I am a member of Financial Empowerment Network Team and Prime Financial Credit Services

Your Credit Score Is Yours to Control

Are you confused by credit, and how to create a better credit score? Don't feel bad, many consumers and business people find it hard to understand why their credit score is low. They pay their bills. And when they are a little late on a payment, they pay extra fees to the Lenders to make up for that. The Lenders enjoy great profits, and yet, the Borrower gets penalized more. Is it fair? I say NO! Enough! It's time for us to take control of our credit scores, and get them to reflect accurately, what kind of people we really are. In fact, the United States government agrees. Toady, there are laws to protect us, and allow us to take back control of our credit histories and credit scores.

Use these laws to make sure you aren't forced to pay more for auto loans, credit cards, mortgages, insurance and utilities. Besides costing you more money in monthly bills, we've been hearing more about people who get job offers that are later taken back, because of a "bad" credit score, a result of having been out of work for a year or longer. They didn't use credit to support a luxurious lifestyle. Ironically, they are penalized by taking away the very thing that they need to get back on their feet and to get back to paying their bills. Is it just me, or does it seem ridiculous to you as well? Credit reporting agencies, and Lenders, seem to believe that it's their right to penalize consumers to any level that they choose. The US government says it isn't their right. It is their right to report late payments and defaults on payment agreements, to the extent that they report it accurately. Is the information on your credit report accurate?

Frits Tessers is a member of the Financial Empowerment Network Team and Prime Financial Credit Services
you can also visit Personal Coaching for more information on Frits Tessers.