| Your credit score, composed of just a few measly | | | | is considered acceptable. Scores below 650 will result |
| numbers, hold such power over the financial future of | | | | in higher interest rate loans. |
| your life. A score at the lower end of the scale can | | | | Banks depend on your score to figure out what the |
| cost you hundreds even thousands of dollars in | | | | risks are of making you a loan. If you're fortunate |
| interest costs over time. A lender will most likely reject | | | | enough to have a high score, you'll be considered a |
| you for a loan because of a low score. | | | | good credit risk. However if you have a dismal score, |
| This number is so potent it can drastically influence | | | | you'll be considered a poor risk for a loan with lenders |
| your power to get a new credit card and mediate the | | | | offering you a higher interest rate loan. |
| best interest rate for a loan. Your score even has the | | | | Insurance companies also place great weight on your |
| power to impact the premiums you pay for insurance | | | | credit score when evaluating you for a policy. Insurers |
| and your ability to secure a job. | | | | believe there is a direct correlation between the quality |
| So how is this score calculated? The combination of | | | | of your score and the likelihood of you filing a claim. |
| numbers is determined by a mathematical calculation | | | | Independent studies reveal the greater propensity for |
| based on your credit history. The appropriate numerical | | | | individuals with a low credit score to file a claim. |
| digits are assigned to your profile based on the | | | | Therefore, expect your insurance premiums to be |
| information gathered from your credit report. By | | | | higher than someone who has a better score. |
| extruding this information, they can estimate the | | | | If you have a low score, it's never too late to start |
| probability of your financial behaviors in the future. | | | | rebuilding it. You can start by ordering a copy of your |
| You'll be surprised to know there a literally hundreds of | | | | credit report from the three major bureaus (Equifax, |
| credit scores compiled in our country, but the standard | | | | Experian, and TransUnion) and verifying all the |
| for most lenders is the FICO score (Fair Isaac | | | | information is correct. Any incorrect information should |
| Corporation). The FICO score has been the | | | | be disputed with the bureau. |
| grandfather of all scores and ranges from 300 to 850. | | | | Next you should start establishing a positive payment |
| With a higher score, you can qualify for better interest | | | | history by paying your bills on time. If you don't have a |
| rates. Statistics reveal more than 75% of mortgage | | | | credit card, you can get a secured card to help you |
| companies and financial institutions depend on this | | | | establish credit. Over time, you can increase your FICO |
| score to evaluate potential borrowers. A score of 700 | | | | score. |