Common Sense About Credit Scores
Protecting Your Good Name
Your personal credit record is one of the most valuable things you own. Protect it as much as your other assets. Your credit score may influence:
- Whether you qualify to borrow money.
- How much you can borrow.
- The interest rate.
- Payment amount.
- Payment schedule.
Signs of Good Credit
- Long history of responsible payments on a variety of debts.
- Regular payments made before or on due dates.
- No late payments.
- Long-term debts paid in full.
- Short-term debts paid in full.
- Stay within your credit limit.
- Manage credit cards responsibly.
- Keep low balances on credit cards and other revolving credit.
- High credit score on your credit report.
- A steady work record and continued residence at the same address.
Signs of Poor Credit
- No payments.
- Late payments.
- Late fees.
- Bounced checks.
What's in a Credit Report
Usually once a month, credit card issuers, banks, retailers, finance companies, credit unions, etc. send updates to credit reporting agencies such as Equifax, Experian and Trans Union. It includes information about how you use and pay your accounts. Lenders make decisions by purchasing and evaluating your credit report.
Your credit report may include:
- Types of credit you use.
- How long your accounts have been open/closed.
- Your bill paying history (on time or late).
- How much credit you are seeking or have used.
- Names of lenders (credit cards, retailers, banks, mortgage, etc.)