If you have a low FICO score, you face difficulty in getting credit or purchasing or renting a property. This is because any lender would run a check on your FICO score, which a sign of your credit worthiness. It is easy to comprehend that a low FICO score is an indication of low credit worthiness.

The Fair Isaac Corp. has developed a computer model that takes into account different information about your credit status, both recent as well as long-ago (history). After gathering all this information, the model weighs the information against the credit status of thousands of other people and then allocates you a score. The FICO Score has a range of 300 to 900 points.

A low FICO score is usually considered to be below 600. At times, even a score of 650 is considered low. It actually varies from lender to lender and their capacity to take risk. A credit score that one lender considers acceptable may be regarded as unacceptable by other lenders for similar a credit instrument. Every so often, the lender would have other circumstances and restrictions that you would be required to qualify.

The Fair Isaac model takes into account five aspects while appraising your credit worthiness. Your average FICO score can be adversely affected by past payment history, balance owed, length of credit history, amount of new credit, and the type of credit used.

You can always work towards a better score, all you need is a little bit of financial education and restraint. By just paying all you bills on time you can increase you score. Every entry of a 30 days late payment, a collection or a judgment can reduce your score by 15-40 points each.

Similarly you get a penalty points for 60 day payment. You can lose as much as 20-40 points for credit and retail cards.

It is important to note that the only true credit score quick-fixes are to pay off debt and to successfully dispute negative information on a credit report.