10 THINGS EVERYONE SHOULD KNOW ABOUT CREDIT SCORES

There are more than just 10 things you should

know about credit scores but here’s what 

we will deal with with for now.

1. CREDIT REPORTS ARE DIFFERENT FROM
CREDIT SCORES

Credit scores are calculated using the

information on your credit reports,

which includes details of your credit

accounts, how often you apply for credit,

debt collection accounts and some public

records, among other things.

2. YOUR SCORES ARE BASED ON 5 

IMPORTANT FACTORS

Those factors are (in order of importance)

payment history, credit utilization, average

credit age, account mix and inquiries. You

can find a more detailed explanation of each of those factors here.

3. CHECKING YOUR OWN SCORE WON’T HURT IT

Only hard inquiries when a lender looks at your

credit when you apply for a loan or credit card have

a negative impact on your scores, and the effect is

small and temporary.

4. YOU CAN GET YOUR SCORES & REPORTS FOR FREE

You’re legally entitled to a free copy of your credit report from each of the three major credit reporting agencies: Equifax, Experian and TransUnion.

your score is determined by 5 factors

5. THERE ARE MANY DIFFERENT SCORES & THERE ARE DIFFERENT CREDIT SCORE RANGES, TOO

When you’re trying to figure out where you

stand or if your credit is improving, make

sure you are comparing the exact same score

and that you know the range

wherever you’re getting the score from

should tell you that information. For example,

a 750 Fico score is not necessarily equivalent to

a 750 in another scoring model.

6. YOUR CREDIT CAN HELP YOU SPOT FRAUD

If someone runs up a large credit card bill or takes out credit in your name, it will show up on your credit report and affect your credit score. Watch your score for changes you did not anticipate

7. YOUR CREDIT SCORE CAN COST YOU THOUSANDS OVER A LIFETIME

A low credit score means you’ll probably have to pay higher interest rates on things like credit card balances and mortgages.

8. JOINT ACCOUNTS AFFECT YOUR CREDIT SCORES, BUT THERE AREN’T JOINT SCORES

If you open a loan or credit card with a partner,

the account activity will be reflected on both

your credit reports. Joint accounts are

different than authorized users, but whenever

you share credit, make sure you’re aware of who

will be responsible and who will be affected if a

payment is missed.

9. NEGATIVE INFORMATION EVENTUALLY AGES OFF

Different kinds of negative information will

remain on your credit report for different

periods of time (bankruptcy is an exception

to this, for example), but generally, negative

information ages off your report and no longer

affects your score after 7 years.

10. CREDIT SCORES AREN’T THE ONLY THINGS THAT MATTER FOR LENDING DECISIONS

A credit score isn’t the only thing lenders consider

when reviewing applicants.

If you have no credit or poor credit, you may be

able to secure a loan through an alternative lender,

and in some situations, making a personal appeal or

giving a lender more context to your credit report can

help you access financial products.

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Checking your score will not hurt it
 CHECKING YOUR OWN SCORE WON’T HURT IT
How to achieve a good credit score


A WORD OF CAUTION ABOUT TRAILING INTEREST


Trailing interest is the amount of interest that adds up between when a credit card bill is sent and when payment is received. 

It is also called Residual Interest.. It only applies when you carry a balance on your credit card

How do you get credit when no one wants to give it to you?

Why Its Important to know your score

To improve your score,

 To apply for a credit card

To apply for a mortgage, 

To apply for a rental To apply for a car loan, 

To apply for a personal loan

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