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There are credit scores out there that you don’t even realize!
Posted on Dec 22, 2006 by Michelle Pastor
The FICO credit score you can buy from Equifax or Fair Isaac is the score that mortgage lenders use to determine your mortgage interest rate, but auto lenders and insurance companies see a different score that you should understand so you can look your best for these companies.
As you would imagine, auto lenders care more about how you’ve kept up with auto-related payments than anything else. So if you pay your auto loans consistently, your auto-loan FICO score will be higher than your traditional FICO score. If you have late payments on an auto loan or a repossession, your auto-loan FICO score will take more of a hit than your traditional FICO score and you’ll pay a higher interest rate on your car loan. If you’re a first-time car buyer, you won’t be penalized – your traditional FICO score will be very similar to your auto-loan FICO score until you get a car loan.
Although you can’t find out your auto-loan credit score, keep on top of your credit report and check for errors, especially those related to auto loan payments and correct them before you need a car loan.
The auto and homeowners’ insurance industry takes a different angle on interpreting your information. You would think that your insurance score would be based on your past insurance claims, but that’s not how it is. Your score takes into account how timely you are with your creditors above everything else – and even more than your traditional score does. You can see your auto and homeowners insurance scores for $12.95 each at ChoicePoint’s web site.
As always, keep an eye on your credit report so there are no surprises with your auto loan rates or insurance premiums.
Tags: credit report, credit score, FICO
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