A Look At Credit Reports And Credit Scores
A credit report is basically a consolidated account of your previous borrowings and repayments. Each time you borrow, pay or delay, it will be reflected in your credit report. Lenders use it to assess how much of a risk it would be to lend to you.
Through your credit report you will be issued a credit score. They will calculate your borrowing and repayment against the time taken to repay and come up with a score which ranges from 300 to 850.
The higher it is, the more financially stable you are considered to be. It means that you are good for a credit card, a loan or a mortgage. If it’s low, it means that your application for borrowing money is unlikely to be accepted.
If you have a credit score of over 700, you are considered to be in excellent credit health. If credit score is below 600, then you are considered a ‘high risk’, and you should look to improve your credit score by paying off some of your debts.
So, why exactly is it important to be have a good credit score?
- Once you have gotten yourself a good credit score, it means easier access to more finances. This could be a car, an apartment, or even just a simple bank loan for your business. Today, it’s practically impossible to get a mortgage with a bad credit score.
- If your credit score is above average, you’re seen as a reliable person who promptly takes care of their debt. This encourages lenders to offer you better deals. You may find yourself getting longer repayment periods or healthy discounts.
- When applying for a job, employers may run a credit check on you. Applicants with the best credit scores are in an advantageous position, as they are seen as being more reliable and honest.
—
Get my free credit report here http://www.myfreecreditreportgov.com/
