Your Credit Score Could Make or Break You

Your free credit score can have a big impact on your life. That score determines whether or not you can buy that new car, be approved for that loan or hired by that new company. Anytime you’re speaking to a bank or lender about a loan, they will be pulling your credit history and score.

That means whenever you’re involved with a purchase that requires a loan, someone is pulling your free credit score and report. The higher your score, the more likely you are to be approved. You will also probably be granted a lower interest rate than consumers with scores lower than yours.

Your free credit score is determined by each of the big national credit reporting agencies. You may recognize the names TransUnion, Experian, etc. - these are the bureaus that hold your credit history in hand. Since there are three, that technically means you have three distinct free credit scores.

These companies determine your free credit score through a variety of factors. Your debt to income ratio plays a roll, as does the amount of credit you have open to you. Your payment history is also a factor, and late or missed payments can have a big affect on your free credit score.

From this information, the bureaus are able to assign each consumer a numerical free credit score based on their results. credit scores can range from 0 to as high as 990 depending on the credit reporting agency. Each agency has its own method of assigning free credit scores.

Typically, a good free credit score is anything over 700. A score of 700 or more will get you approved for most practical loans, and net you a decent interest rate as well. The higher your free credit score, the better interest rate you are likely to get.

Your free credit score can tell a lender or other inquirer a lot about you as a consumer. It lets them know whether you pay your debts on time, or whether you have any buying or credit history whatsoever. Even potential employers ask permission to pull your credit report and score to determine whether you’re eligible for employment.

Since your free credit score can have such a huge impact on your decision making, it’s important to stay on top of it. You should pull your credit report at least once a year, and utilize a free online service to get your free credit score. This will help you take care of issues if and when they crop up, ensuring that the next time you’re ready to make a big purchase, you don’t have to sweat about your free credit score.

Written by Tawana Rashing on July 7th, 2009 with no comments.
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