How Does Credit Score Affect Your Life?

Credit score becomes an essential part of our life since we get our first credit card. This is the number between 300 and 850 that is checked by lenders whenever you decide to apply for a car loan, mortgage or any other type of credit. Proper understanding of what your credit score consists of may help you improve it and receive significant benefits, since good credit history leads to lower interest rates and makes lenders more willing to give you loans.

What is a Credit Score?

Banks, credit card companies and other lenders use credit scores to evaluate the potential risk posed by lending money to certain consumers. The lower your number is, the more risky it is for lenders to grant you a loan and, consequently, the more reluctant they become to provide you with loans. In the US people have three different credit scores from three major credit bureaus – TransUnion, Experian and Equifax.

How the Credit Score is Calculated?

Though the credit bureaus do not reveal the entire process of credit score calculation, it is known that your credit rating consists of several aspects. The largest part, 35 percent of the score, is determined by your payment history and may be damaged by late payments of loans. The credit utilization factor (the ratio of the current revolving debt to the total available revolving credit) makes 30 percent of the credit score. The length of your credit history impacts 15 percent of the rating. The types of loans you take determine 10 percent of the credit score and another 10 percent are determined by recent credit inquiries.

How Can I Learn My Credit Rating?

Unfortunately, there is no legal way to get to know your credit score free of charge. However, you can visit the official Experian website www.experian.com and check all three credit ratings for $40. Note that all companies that promise to calculate your credit rating for free cannot provide you with your actual score, they are only educational resources and can only make estimates. Each if the three credit bureaus can provide you with the copy of your credit report once a year or in case you’ve been rejected for credit. Such reports contain the information used to calculate your credit rating, however, the actual credit score is still not provided.
Keep in mind that even if you have a bad credit rating or no rating at all you may still request a short-term loan at fast1500.money, since the majority of lenders from our network do not perform any credit checks.