| Your credit report, also known as a FICO score, is | | | | adults living in the United States is 720 points. |
| used by banks and other financial institutions to | | | | There are five main factors involved in the calculating |
| determine the statistical chance of you not repaying | | | | of your credit score. These factors include, in order of |
| your loan. This score takes into consideration your | | | | importance, your payment history, amounts you |
| previous and current financial activities and calculates | | | | currently owe, the length of your credit history, new |
| them into a numerical representation of the risk | | | | credit accounts, and the types of credit you have |
| involved for the bank. The higher your score is, the less | | | | used. |
| risk for the lender, and the better your rates and terms | | | | How Can I Raise My Credit Score? |
| will be. | | | | One of the most important factors in maintaining a |
| What is the Average FICO Score? | | | | good credit score, is to frequently check your report, |
| The FICO scoring system, created in 1956, has | | | | as the majority of people have errors, fraudulent |
| become a standard way for many mortgage lenders | | | | charges, out of date entries, or other factors that can |
| to judge risk-factors that may effect their loans. This | | | | negatively effect their financial standings. The easiest |
| score generally ranges between 300 to 850, with 850 | | | | and most cost efficient way to check your credit is by |
| being the best possible credit and 300 being the worst | | | | taking advantage of one of several websites offering |
| possible credit score. The average median score for | | | | free FICO reports online. |