credit score rating
is much more than a three digit number. It is used to determine your creditworthiness. Credit scores are calculated using information in your credit reports on file with the three major credit bureaus, which are Equifax,Experian and TransUnion. These privately run companies collect credit and other information about individuals. This information can be accessed by other institutions for a number of reasons, that may be to determine your creditworthiness or background checks for employment.The leading scoring formula is called the FICO, which was created by the Fair Isaac Company.FICO scores range from 300 to 850, with higher scores indicating a lower risk of default on financial or
Your credit score is important because it determines how much you will pay when you borrow money.It is used by insurance companies to set premiums when applicants are evaluated, and cell phone carriers also use it to decide whether to sign you up for a service.Your credit score is adjusted, anytime there is a action that concerns your finances. A simple act as a check of your
or a late payment on any of your bills will affect your score. Even maxing out your credit cards will lower your score.The better your score is, the more vulnerable you are to losing points after any credit mishaps.If your score is 780, you can lose at least 100 points if a payment is missed.
You are allowed two free annual reports of your credit file,and you can also dispute any errors such as transactions that are not yours, or reports of late payments that were actually made on time.It is possible to manage your credit score rating and boost your rating if you have control of your finances and know how the credit rating system works.Unfortunately, you cannot
raise your credit score
if you don`t use credit. The credit score rating is used to predict how well you are likely to use credit in the future, by how well you may have used it in the past.There are many strategies that you can use to boost your credit score.
More than thirty percent of your score depends on how much credit you are actually using. There should be a big gap between the balance you carry on revolving debt and the limit that you are allowed. The less of the available credit you use, the higher your FICO score is likely to be.If you need to use credit cards, it may be better to manage smaller balances on many cards,than to have to have a large balance on one card.
Credit repair takes time, but you will most likely see improvements in your score within thirty days, if you pay down a significant portion of any credit card debt.The lower your scores, the longer it may take to increase your FICO scores, but it is possible and perhaps anyone can hit the 740 mark by consistently using credit responsibly.Patrolling your credit reports closely and paying down all debts with regular payments, can easily contribute to raising your credit score rating.