What Is Credit Scoring?

Credit Scoring Simplified

What Is Credit Scoring?

Credit Scoring is a tool utilized by creditors to assess your creditworthiness and determine the terms of credit extended to you. When applying for credit, lenders typically request your credit report and score from major bureaus like Equifax, Experian, or TransUnion. In some cases, all three bureaus are consulted, especially for significant transactions like mortgages.

What is Credit Scoring

Credit Score Facts

A FICO score above 700 secures a good mortgage rate, while a score above 720 offers even better rates, potentially saving you thousands. Conversely, a score below 700 can hinder loan approval and should be improved.

Repairing an undesirable credit score involves correcting mistakes on your credit report, a tedious process. Regularly obtaining copies of your credit report and disputing any misinformation with the major credit bureaus is the key to higher credit scoring. 

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