There are many misconceptions
about credit scores out there.
There are customers who believe
that they don’t have a credit
score and many customers who
think that their credit scores
just don’t really matter.
These sorts of misconceptions
can hurt your chances at some
jobs, at good interest rates,
and even your chances of getting
some apartments.
The truth is,
of you have a bank account and
bills, then you have a credit
score, and your credit score
matters more than you might
think. Your credit score
may be called many things,
including a credit risk rating,
a FICO score, a credit rating, a
FICO rating, or a credit risk
score. All these terms refer to
the same thing: the three-digit
number that lets lenders get an
idea of how likely you are to
repay your bills.
Every time
you apply for credit, apply for
a job that requires you to
handle money, or even apply for
some more exclusive types of
apartment living, your credit
score is checked.
In fact, your
credit score can be checked by
anyone with a legitimate
business need to do so. Your
credit score is based on your
past financial responsibilities
and past payments and credit,
and it provides potential
lenders with a quick snapshot of
your current financial state and
past repayment habits.
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What Does Your Credit Score Tell You?
When you apply for a loan or a mortgage, the first thing the lender does is to check your credit score. Based on your credit score, the lender decides the amount of finance you are eligible for and the interest rate at which you will be charged. So what is this credit score and how does it influe …
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In other
words, your credit score lets
lenders know quickly how much of
a credit risk you are.
Based on this credit score,
lenders decide whether to trust
you financially – and give you
better rates when you apply for
a loan. Apartment managers
can use your credit score to
decide whether you can be
trusted to pay your rent on
time. Employers can use
your credit score to decide
whether you can be trusted in a
high-responsibility job that
requires you to handle money.
The problem
with credit scores is that there
is quite a bit of misinformation
circulated about, especially
through some less than
scrupulous companies who claim
they can help you with your
credit report and credit score –
for a cost, of course.
From
advertisements and suspect
claims, customers sometimes come
away with the idea that in order
to boost their credit score,
they have to pay money to a
company or leave credit repair
in the hands of so-called
“experts.” Nothing could
be further from the truth.
It is perfectly possible to pay
down debts and boost your credit
on your own, with no expensive
help whatsoever.
