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As mentioned on our mainpage, your credit score
is composed of 5 different factors. Below are more detailed explanations of
what these factors consist of:
1. Your payment history: People
that have not made payments in the past usually have a tendency to not make
payments in the future either.
2. Way Credit has been used:
Somebody who always maxes their credit cards out, or is usually close to
that limit, is supposed to be a bigger risk for lending companies, compared
to people that don't use up their credit card limits.
3. Age of
credit file: It is assumed that people who have had credit for a long time
are less of a risk, compared to people that are just getting their first
credit approved.
4. Number of times a person asks for credit: Asking
many times for a credit card, loan or mortgage in a short period of time
will negatively impact your credit score.
5. Your mix of credit currently in
use: Someone who has only one credit card is considered riskier than someone
who has a combination of rolling loans and installments.
What does your Credit Score mean? In order for
you to find out what your credit score means, we are offering a
categorization of the possible scores. See in what category your score
falls, and you will find out what lenders will think about you. Don't know
your score? Get a
FREE creidt report.
660 and above
Your credit score is rated "acceptable",
which basically means that you have good credit and your credit files will
only have to go through a basic review when you are applying for your loan.
You will usually find your loan quickly and should also be offered a
competitive interest rate. 620 to 660
The credit
report companies classify your credit risk as "uncertain", which means that
you still have a good chance at getting your loans, but your credit history
will have to go through a thorough review, and you might be asked to provide
some additional documents to the lender, before your loan will be approved.
Below 620
This score indicates "high risk", which means that you might have
a difficult time to obtain traditional financing. It doesn't mean that it
will be impossible, it will just be a lot more difficult, compared to people
having a higher credit score.
How to improve your Credit Score
Doing the following things will help you improve your credit score and
should allow you to receive the necessary financing:
1. Pay your bills on time and stay current.
2. Keep balances as low as
possible on credit cards and on other revolving credit.
3. Pay off your debt
instead of just moving it around.
4. Don't close your credit cards as a short
term strategy.
5. Don't open new additional credit cards, just to
raise your available credit.
6. Apply for and open new credit accounts only
as needed
7. Remember that it's ok to check your credit report. You
should always keep an eye on your credit. So, get your
creidt report
today from one of the providers listed on our homepage. |
