Your creditworthiness could soon go up due to some new credit score calculation changes in 2014, thanks to changes brewing at Fair Isaac, the company that calculates the widely used FICO credit score. Currently, if you fail to pay a bill, your credit will continue to take a hit years after you settle with the collection agency. However, under the new terms, debts that were delinquent but have been paid will no longer affect credit scores. Unpaid medical bills that have gone to collectors may still influence your creditworthiness, but they will not be weighted as heavily.
The changes are intended to make it easier for borrowers to get access to loans. Nessa Feddis, senior vice president of consumer protection and payments at the American Bankers Association, tells The Wall Street Journal that this could stimulate spending nationwide.
“It expands banks’ ability to make loans for people who might not have qualified and to offer a lower price