A credit score is a snapshot of your financial history and is used to help determine your creditworthiness.
Because this score is an indicator of the likelihood of you paying your bills, it is used by financial institutions to determine whether you may be eligible for credit or debit cards, loans, utilities or other credits. You can also improve your credit scores with the help of experts such as https://www.myoptimumcreditsolutions.com/.
Your credit report is also a factor in assigning a credit limit and determining your interest rate credit given. As a way to decide if you are responsible with money, many employers and owners, research your credit history as well.
By law all US residents are allowed a free copy of their credit score once every twelve months.
The 3 major credit bureaus; Experian, Equifax and TransUnion use algorithms somewhat different to arrive at your score, you could have a variety of scores at each of the three offices.
The basic makeup of a credit score:
– 35% payment history. debts to pay, including the end of your mortgage, car payments and credit cards will lower your score. If you make your payments as agreed will increase your score over time.
– 30% is attributed to the use of credit. This is the ratio of your total credit in use in relation to the total limit available. Your score can be improved by paying part of the debt, which in turn lowers your utilization rate.
– 15% goes to the credit history length. As the age of your history increases your score will increase assuming you pay your debts as agreed.
– 10% goes to the variety of credit used. By using many forms of credit, including consumer credit, revolving payment and you can also give your score a boost.