The credit score
It is a three-digit number that lenders use to assess your creditworthiness and your ability to pay your bills on time.
- The score ranges between 300 and 850.
- The higher the score, the more creditworthy you are, and the more likely lenders will lend you money at a lower interest rate.
- The FICO score is the most widely used, but there are also other systems.
- Your history of payments determines your score as well as your credit utilisation.
- Your credit report determines your credit score.
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Factors that make up your credit score
- Late or missed payments will drive down your credit score and remain on your record for seven years.
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Credit scores are different from credit reports
A credit report documents your credit history, your current status of accounts and payments, and when companies have pulled your report when you've applied for credit. A credit report is the source of your credit score.
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Credit repair companies
Common factors that could damage your credit score are negative items, such as bankruptcies, foreclosures, late payments, high credit utilization, and credit inquiries from potential lenders.
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