Your credit score is one of the most important numbers in your life. It can determine whether you can get a loan, how much you’ll pay for that loan, and even whether you can rent an apartment. But what is a credit score, and how do you keep track of it? A credit score is a number that summarizes your credit history and creditworthiness. Your credit history includes all of the credit you have ever applied for, credit cards you have held, loans you have taken out, credit repayments…
How can I keep track of my credit score?
There are several free tools like Credit Karma, credit sesame and myFICO available to you so that you can keep track of your credit score without any cost to you. Three of the largest credit bureaus in the country, Experian, Equifax and TransUnion, offer free credit scores on their websites. You can also sign up for a credit monitoring program that will send alerts when something changes in your credit report.
What factors go into my credit score?
Your creditworthiness is based on several factors, most of which aren’t public knowledge. These include:
– credit history (older credit accounts and credit accounts with a larger credit limit usually contribute to a higher credit score)
– credit card utilization (the amount of credit that you use compared with the total amount of credit available to you is an important factor)
– credit inquiries (when someone checks your credit score, it temporarily lowers your credit score)
– type of credit you have (installment loans, like mortgages and car loans, are considered more reliable than revolving credit, like credit cards)
What can I do to improve my credit score?
There is no one answer to this question, as your credit score is based on your unique credit history. However, some things you can do to improve your credit score include:
– paying your bills on time
– keeping your credit card balances low
– not opening too many credit accounts at once
– disputing any inaccurate information in your credit report
Credit scores are important, and you should make it a point to keep track of your credit score from time to time.
Authorized by federal law, you can request your free Annual Credit Report for free on an annual basis here.
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