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Credit Score
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What is considered a good credit score?
Your credit score is a system creditors use to help decide whether or not to give you credit. Your credit score usually takes the following types of information from your credit report into consideration:
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- Payment history
- Outstanding debt
- How many and what types of credit accounts you have
- Have you applied for new credit lately
- How long you have had a credit history
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There is a direct relation between your credit score and your chance of defaulting on your credit obligations based on your credit history. The higher the credit score the lower the risk of default.
Credit scores range from 300 to 900. The average score is 750 and above 700 is generally considered good credit. If the 3 major agencies report different scores, a lender will usually use the middle number.
Improving your credit score can differ between creditors and different types of credit. But since most credit scoring systems take the above 5 factors into consideration, doing things like paying your bills on time, reducing your debt, and not increasing your debt with new debt will generally improve your credit score. Remember it will take time to improve your score.
Your credit report is important to your credit score. Be sure it is correct before applying for any more credit......get a copy of your credit report today!
