Your Credit Score is very important and here is why:
Your credit score is very important. It can determine the joys of getting approved for car loan, credit cards and even a higher purchase for a house. Your credit score is also used in determining also when opening your own business and many other important factors.
There are three credit bureaus that report your credit score. They are Trans Union, Experian and Equifax. Some are more accurate than others but they also focus on which area you live in the United States. You can always contact these agencies to have information corrected. It is very important that you stay on top of your credit and monitor your score, if there is a drastic drop in your score then there might be a situation of fraud and someone has got a hold of your information.
Many banks or lenders put you into a bracket or tier to see what rate and what you might qualify for by your credit score. So the higher the score, usually determines the better your credit is. The lower the credit score, the more improvement you need. Creditors do not know how much you have in your bank account, which can be withdrawn tomorrow. The only evaluation is by how you pay your credit card bills on time. We at Air Flash MLS recommend that you pay all your bills on time. Now a lot of people think that one day late is ok but it is actually not. For the credit bureaus, they count that as 30 days late. If your minimum payment is $10.00 for example and your pay history is bad it paints a picture that the consumer has bad money management and not able to pay their credit card.
Your credit score is determined by all the pieces of credit you have on your credit report. Your credit report shows, a lot of information about you. Information that your credit report shows is your address, and previous work addresses. Also your total amount of credit and balances you are carrying monthly. Your availability of credit. How much monthly is your revolving credit minimum payments. Your history of credit and how you paid your credit cards, car loans, student loans and mortgages. Anything that deals with credit will be on your credit report. There are also on the bottom of your credit report, credit inquires which shows lenders where you have applied for credit. The more hard inquiries you pull on your report, the more your credit score will drop. It tells banks that you are shopping and might be a risk, so if you do not have to run your credit, you shouldn’t.
Now just because you have a high credit score does not mean you have excellent credit, there are other factors that play a role. So for example how many trade lines which are pieces of credit you have also are important to determine what you qualify for.
Your credit score can determine what kind of interest rate, term and payment you can qualify for. The better your credit is, the lower your payment will be and more arguing power you have. If your credit is not that good you will see how difficult and how much higher your payments will be.