The Beacon Score

Maybe you have already heard about credit score but if you are not familiar with the beacon score then read this article. This article will give you the information about beacon score, the difference between the two major types of scoring and the advantages of your business for having a good beacon score. After reading this article, you should have an idea about beacon and the vantage score and the benefits it gives for having a good score.

There are three credit bureaus that take care of the credit score. These are Experian, Equifax, and TransUnion. The three of them follow their own variations of the FICO credit scoring system. The beacon score refers to your credit score that is used by Equifax bureau. The beacon score is based on certain factors of your life which includes your job, income, debts, loans, and changes of address. The beacon score gives the credit firms or banks the right interest rate to be given on your loan.

Here are the difference between the two major types of scoring namely the FICO beacon score and the Vantage score. The typical FICO beacon credit score ranges from 300-850, with 850 being excellent rating while the vantage score ranges from 501-990. A beacon score of 620 is the dividing line between lower interest rates and much higher rates. FICO beacon score has 5 criteria in credit scoring namely; payment history, credit-to-debt ratio, length of payment, recent inquiries, and credit mix. The Vantage score has the five criteria of FICO beacon score and with the addition of the available credit. The FICO beacon score weighs 35%, 30%, 15%, 10%, and 10% respectively and the Vantage score weighs 32%, 23%, 15%, 13%, 10%, and 7% respectively.

There are two major advantages of having a good beacon score for a business. Having a good to excellent beacon score will give you an opportunity for getting a loan that enables you to expand your business in any way you want it. The other main reason is that having a good beacon score gives you an advantage of getting lower interest rates. This way, it would be easier to get the capital you need to buy your equipment and the monthly payments will be lower than others who have poor credits. Due to the fact that you have lower payments, you have more cash left over for the other items you need to pay for, but can't finance.

Now that you know the benefits of having a good beacon score, you should now see how it helps you considerable amount of money in the long run. The trick to keeping a high credit score is to only take out a loan when it is absolutely necessary and to pay it back on time.