If you’ve got credit score questions, you’ve come to the right place. The idea of a credit score can be a bit confusing. Who develops a credit score? What do credit scores mean? Who looks at a credit score? These and many other credit score questions are bound to arise for anyone who is interested in having a healthy credit rating and good borrowing power. Here are some of the more common credit score questions and answers.
A credit score is a measure of your risk level to a potential lender. In general, the higher the score, the better a risk you are, meaning the less likely you are to default. The three major credit reporting bureaus, Equifax, Experian, and TransUnion, all provide credit scores, but it’s important to note that they offer their own proprietary scores in addition to the score that lenders look at.
A good credit rating tends to be a higher credit rating. People with high credit scores usually can be relied upon to make their loan payments. If your score is not quite in the highest category, you are still a fair risk for lenders, but you probably won’t get the most favorable rates. If your score is low, you may struggle to get approved for a loan, and the loan you do get will probably be at very high interest rates or with large payments built in.
The best way to raise your credit score is through responsible borrowing and budgeting practices. If you make payments on time, pay more than the minimum due, and limit yourself to only three or four credit cards, you will be well on your way to a higher credit score.
“Can I find out my credit score ?” If you've asked yourself that question recently, the answer is YES! Checking your own credit score is not damaging to your records, in fact it is recommended. You can get a free credit score here at CreditScore.com. It’s a great idea to review your report and score to make sure that everything is as it should be. Moving forward, you'll be alerted to major activity with either your score or credit report, which is an important defense against identity theft and an effective way to manage your credit information.