Credit cards are a part of our everyday life and are the easiest way of buying things when we haven’t got enough money. If you don’t have one yet, check this out.
When it comes to credit cards, the requirements are not as clear and standarized as those used by mortgage lenders, for example.
A credit card lender may use only two credit scores. A FICO 8 score, referred to as a Bankcard score, is usually amogn them. The difference between a standard FICO score and this one, is that the Bankcard Score doesn’t consider all credit to be equal. The FICO 8 Bankcard Score focuses on your behavior with credit cards specifically, and rewards or penalizes you according to this.
Anthony Sprauve, a senior consumer credit specialist at FICO explained that:
“This version of the base FICO Score was developed at the request of our credit card customers to give them a FICO Score that more closely addressed their needs.”
Other credit card lenders still, might use in-house credit scoring models as an additional way of verifying your credit score, but most of them don’t reveal which credit card bureaus they use.
However, there are more things that make it difficult to know how card lenders evaluate the risk you pose: the methods used change frequently and they use much more diverse standards. The minimum score required by a card lender may vary too. It can be of 700, while others have no problem approving a 650 credit score.
This is why he Bankcard score is becoming popular among card lendres: it weighs many factors and provides a different score for a credit card lender than it would for a mortgage lender.
The fact that the requirements, and the factors taken into account change from one lender to another, makes it very difficult to speculate whether you will be able to qualify or not for the card you choose initially. So, keeping up with the good credit habits you have always been using to strengthen your base FICO score is stll the best bet.
These habits include:
• Paying your bills on time
• Keeping your credit utilization ratio low
• Establishing credit as soon as you can
• Limiting new credit applications
• Keep a healthy mix of credit accounts on your report
Note: the first two factors that appear to carry more weight than the others