A strong prestige score has come to be more important than ever due to these uncertain economic times. Restrictions for lenders have gotten a lot tighter since the mortgage meltdown. There's no way of getting nearby it anymore - if you have bad credit, you won't be eligible for a home loan.
So you're probably wondering, "why is my prestige score so important? And how is it determined?"
Ensure a Strong prestige Score
At its basic level, a prestige score is the number that indicates to lenders and creditors how likely you are to pay back the debt you owe. The score is essentially based on your borrowing history. It will determine if you are eligible for a loan to buy a home, car, or finance your college tuition.
How do you know if you have a good prestige score?
Scores range from practically 300 to 900, with the median prestige score in America being at about 693 according to Experian. Generally, if you have in the middle of 660 and 719 you're in good shape. Pay extra attention if you begin to fall below 620, as it will be highly difficult to qualify for any loan with this bad of credit. 720 and above means you have excellent credit!
What's in a prestige Score?
While the exact method to calculating a prestige score is still unknown by the normal public, we do know what your score is comprised of from a normal standpoint.
• Timeliness of payments = 35%
• Amount of debt in relation to the number of your total prestige = 30%
• Length of prestige history = 15%
• Type of prestige in use (installment loans, revolving, branch store cards, etc.) = 10%
Bankruptcies, foreclosures, and other judgments are all blemishes that can negatively impact your score. The more of these problems you have, the more lenders are reluctant to offer you a low interest rate.
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