Your FICO

Credit is not as big of a part of life on Saipan as it is in the mainland U.S., due in no small part to the lack of a genuine mortgage industry here. Still, credit cards and auto loans are important parts of Commonwealth life…which means that your “FICO” credit score is also important.

I have some good news on this point, and it’s good news that will hold until March 26. Up until that date, the guys behind the FICO score, the Fair Isaac Corporation, are discounting some useful consumer on-line services by 20 percent.

Of most interest is a service called Score Watch. I pony up $79.95 a year for the service, but the 20 percent discount would bring it down to $63.96 for new subscribers.

That’s a good deal, and for a good service.

Here’s the concept: You go to MyFico.com, fill out a simple on-line form, and, presto, you get a look at your FICO score. Various tools allow you to analyze this score, and evaluate scenarios that might change it.

The service also monitors various aspects of your credit file, keeping a hairy eyeball on changes that might indicate the dreaded specter of identity theft or other weirdness. Any such changes will trigger an e-mail that not only alerts you to the situation, but also quantifies its impact on your credit score.

Neat, eh? I think so.

The Score Watch includes the FICO score and monitoring based on data from just one of three major credit reporting agencies, Equifax.

Things can get kind of complicated, and more expensive, if you want them to.

If you want your FICO score based on data from either of the two others, TransUnion or Experian, you’ve got to pony up $14.95 each time. It seems normal for the scores to vary a bit by agency, but a substantial difference would indicate that you might have an error somewhere, and it might be time to start digging into your credit reports. As for TransUnion and Experian, they offer their own credit monitoring services as well.

Anyway, as for the FICO credit score itself, it’s a single number based on a scale of 300 to 850. The higher the score, the better your credit is.

The exact formula behind the score is quite mysterious, but the following factors, gleaned from the MiFico.com web site, are said to be included, in descending order of importance:

1). Payment history

2). Amounts owed

3). Length of credit history

4). New credit, and, tied with this,

5). Types of credit used

This list doesn’t mention that certain “inquiries” (which occur when you apply for credit) can reduce your credit score, so that’s a factor to consider as well.

Well, as you can see, there is a lot to this credit score stuff. Fun? Hardly.

Important? Yes. So MyFico.com is one excellent service that I felt compelled to call to your attention. As much as we blabber about the Commonwealth’s economy, it’s your personal economy that really matters.

(Ed Stephens Jr. is an economist and columnist for the Saipan Tribune. E-mail him at Ed@SaipanEconomist.com.)