There are several things that you need to know about your credit score.
Difference
The first thing is that you need to know that the credit reports are
different than the credit scores. The credit reports are going to the
details of your credit accounts while the credit scores are going to be
based on the calculations on the credit reports. The details on the
credit reports are going to be how many times that you have applied for
credit, some public records, and your debt collection accounts among
many other things that are related to your credit.
Factors
The second thing is that your credit scores are going to be based on
five core factors. The first factor is your payment history like if you
have made all of your payments on time. The second factor is how you
have utilized your credit. The third factor is the average credit age
that you have. The fourth factor is the mixture of credit that you have.
The last factor is any of the inquiries that you might be on your
credit.
Free
The third thing is that you will have the ability to get your credit
score and credit report for free. In fact, you are legally entitled to
receive a free copy of your credit report once a year from the major
credit reporting agencies. These agencies are going to include
TransUnion, Equifax, and Experian. You are also going to be able to get
your credit scores for free from a variety of different places. One
place where you are able to get two scores from is credit.com.
Checking
The fourth thing is that it will not hurt your score if you check it
yourself. The only times that your credit scores are going to be
affected is when there is a hard inquiry. This is when a lender will
look at your credit when you apply for any type of credit. This will
have a negative affect on your credit scores. But it is important to
remember that the effect is going to be small and will only last for a
short period of time.
Ranges
The fifth thing is that there are a variety of different scores and
ranges for the different credit scores. If you are trying to figure out
where you stand or if there is an improvement in your credit, you will
need to make sure that you are comparing the same exact score and that
you know what the range is. The place where you get the score from
should be able to give you all of this information. In other words, if
you have a 750 FICO score, then it is not going to be the same on the
other types of scoring models.
Fraud
The sixth thing is that looking at your credit scores is to help you to
spot any fraud that might be happening on with your credit. This means
that you are going to know if someone has ran a large credit bill up in
your name or if someone has gotten a credit card or loan in your name.
This is because it is going to be on your credit report, so it is going
to affect your credit scores. Therefore, you are going to need to watch
your score for any changes that you did not expect.
Costs
The seventh thing is that your credit scores can cost you thousands over
a lifetime. This is because when you have a low credit score, then you
will have to pay a higher interest rate on things like your mortgage or
credit card. Most of the time, the place where you check your credit
scores is going to have a lifetime cost of debt collector that allows
you to see how much the credit is going to cost you.
Joint Accounts
The eighth thing is that having a joint account is going to affect your
credit scores, but there are not joint scores. If you decide that you
want to get a loan or a credit card with your partner, then the activity
on your credit account is going to be reflected on both of your credit
scores. The joint accounts are going to be different than the authorized
users, but if you share a credit, then you need to make sure that you
are aware of who is going to be responsible for the bill and when the
payment isn't, those credit will be affected.
Negative
The last thing is that any negative information is going to eventually
age off. Most things will age off of the report in about 7 years. But
this is not the case for bankruptcy, which will be on there for a longer
amount of time compared to the other types of negative things.