rating or credit score is a number assigned to individuals that assesses how
well a person manages his or her money.
A credit score is a calculation of how much debt a person has in
relation to his or her available credit, type of credit available to that
person, the person’s payment history, and the length of time a person has had a
credit history. A higher credit score
gives lenders confidence about a person’s ability to manage money, while a
lower score gives lenders concern about a person’s ability to manage
credit reports to how well a person has managed their money over time. A credit report includes details about
payment history and credit availability to support the credit score.
The total balance
of the amount owed on credit accounts should not exceed 30 percent of the
available credit you have in order to keep an excellent credit score . Closing credit accounts can be dangerous to
your credit score as it lowers the ratio of debt to available credit and can
lower your credit score as a result.
be applied for in a prudent manner. Credit
score agencies do not penalize you for shopping for auto or mortgage rates in a
short period of time, but lots of other types of inquiries on your credit history
is a red flag and can lower your credit score.
history is built upon at least six months of credit and payment history. If borrowing money is in your future, it is
best to start small with a credit card used to purchase gas and groceries. These balances should be paid in full or
almost in full on time every month to establish a good credit history.
You can check your credit score for free once
each year through one of the credit agencies like Equifax, Experian, TransUnion.
It is important to make sure that your
credit history is accurate and does not have errors before you apply for