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FICO Score is No Respecter of Income

The common belief that income directly impacts the strength of one's FICO score is perhaps the longest-living credit myth on record. The truth is whether you make $25,000 or $250,000, your FICO score couldn't care less.

While it's true that a six-figure income shouldn't hurt your ability to pay your bills or get approved for that next home or auto loan, it's important to understand that FICO scores are based solely on information provided in your credit reports. And your income, for example, is one piece of information that will never find its way onto your reports.

So, the next time a friend or relative tries to explain how your raise this year will help boost your FICO scores to the next level, do your part in putting an end to this credit myth and set them straight.

If you're interested in reading more about other credit myths as well, visit our Credit¢ents blog under the category Credit Myths.

on Sun, 2010-01-24 16:00