Why Your Credit Score is Important

Your credit score can either haunt you or reward you. It all depends on how you handle your credit and payment activities. Your credit score determines what interest rates you will pay and if you are even approved for a loan or a credit card at all. In addition, your credit score can play a factor in renting your next apartment or getting hired from a potential employer.

Your credit score is compiled from the information on your credit report. The performance of your credit activity is rated on a numerical scale from 350-850. This number is your credit score. The higher your credit score, the better. Late payments, delinquent accounts and maxed out credit limits are all things that can lower your score. Below is a general guideline to determine what your credit score means in terms of getting approved for a loan or receiving credit and what type of interest rates you can expect to pay.

750-850: Is considered to be an excellent credit score. You can expect approval and should receive a great interest rate.

680-749: Is considered to be a good credit score. Generally you should be approved and given a favorable interest rate.620-679: Is considered to be a middle of the road score. You will more than likely be approved but you may have to pay a higher interest rate.

550-619: Is considered to be a low credit score. You can find lenders who will approve people with poor credit scores but they will probably charge very high interest rates and fees.

300-549: Is considered to be a very bad score. It will be a challenge to find a lender that will offer you credit at all.

Do you know what your credit score is? Having this information can save you the time and hassle of trying to get approved for loans that you may not even be eligible for. There are many reputable companies like http://www.credit-report-credit-score.com that can provide you with your credit score for free.

If your credit score is lower than you need it to be, there are many ways to get your score up. It will take some time and diligence but it can happen. There are credit repair companies available to help get your credit situation back into shape. But there are also actions you can take on your own to improve your credit score.

First, you have to be sure to make all of your future payments on time. Late payments can be very detrimental to your credit score. Secondly, you should try to stop charging if you have a lot of credit card debt. If you do have a lot of credit card debt, you should try to pay the balances down as much as possible. Do not attempt to obtain new credit and do not fill out excessive amounts of loan applications. New accounts and numerous credit application inquires can be a hazard to your score.

If you currently have a good credit score, then make sure you keep it! If you are beginning to have financial trouble and your monthly payments are becoming a challenge, try at all costs to avoid defaulting on any of your loans, especially your mortgage. Taking out a debt consolidation loan is an option that can help ease your monthly payment obligations and keep you from ruining your credit score.

With all of this said, you can see why your credit score is one very important little number.

-------------------------
Note: This article may be freely reproduced as long as the authors bio paragraph at the bottom of this article is included, the article is published "as is" (unedited) and all URL's are made active hyperlinks with no syntax changes.
-------------------------

This article was written by Beth Pardue who has over 10 years of experience in the financial industry assisting clients with assorted financial needs. To learn more about credit reports or to get a free credit report online please visit: http://www.credit-report-credit-score.com

More Resources

Unable to open RSS Feed $XMLfilename with error HTTP ERROR: 404, exiting

More Credit Information:

Related Articles

New Credit Advice: Dont Pay off Those Credit Cards!
Credit needed for real estate mortgage financing differs from credit needed for consumer loans. If you need help getting a home mortgage, these credit tips will help you.
Credit Verus Debt
Secured and unsecured debt - what's the difference?It's easy to just think that debt is just debt, but in reality, there are different types of loans, and it's important to know what which type you have.You will need to understand the differences in order to be a good money manager, or, if the worse happens and you find yourself turning to credit or debt counseling, you'll need to understand how different types of debt can be handled.
Dont Dig Your Own Pit
If you want to enjoy your life out of spending, enjoy if you have your own resources and money.But don't enjoy your life by becoming a debtor to somebody.
Special Credit Information for Married Couples
If you are married, establish separate credit accounts.Try to finance real estate in just one partner's name to increase your investment financing potential.
What Should I Do If I've Become a Victim of Identity Theft?
Identity thieves take advantage of everyday opportunities to discover your personal information and use it to commit fraud or other crimes. The good news is a victim of identity theft has more options today than ever before.
Why Consumers Need a Nationwide Credit Freeze NOW
What do a shoe retailer, an online discount broker, and a popular clothing retailer all have in common? All three - DSW Shoe Warehouse, Ameritrade, and Polo Ralph Lauren - sustained breaches to their customers' accounts. Unfortunately, these three are not alone when it comes to security breaches.
Give Yourself Credit
The Beginning of the Credit Card EraIn 1951, Diners Club issued the first credit card to 200 customers who could use it at 27 restaurants in New York City. From that modest beginning, credit cards have become an indispensable part of modern life.
Grants, Loans, Free Credit Cards And Credit Repair: The Whole Truth And Nothing But The Truth
You got creditors calling you everyday. You could lose the car or house.
Harassment of People in Debt by Creditors
HarassmentHarassment of people in debt by creditors or their agents is a criminal offence under the Administration of Justice Act 1970. It is often difficult to know what to do when you feel a creditor is not dealing with your account fairly.
Like It Or Not, You Have A Score To Settle!
Like It Or Not, You Have A Score To Settle! (Part 1 of 2 on Credit Scoring)Just when most people finish with school and can stop worrying about test scores, there's a new kind of scoring that enters the picture. It's called credit scoring.
Maximizing Credit Card Rewards
We spend money every single day on many different types of products and services and the banks' newest offer is that of saving when spending if you use their services; that is if you pay for your expenditures with special credit cards. These credit cards are part of a wide offer and the best thing to do is read as many bank-offers as possible before choosing a particular card.
Shoppers Beware - Tis The Season
It's the number one complaint from consumers and it only takes a moment for you to become a victim. While you search for holiday bargains, identity thieves are searching for targets - unsuspecting consumers.
5 Steps You Can Take to Get Paid!
There are always some companies that have past due invoices and can't seem to get them paid. They might be quietly waiting to get paid not wanting to contact the client for fear of appearing "desperate".
Warning: Todays Non Profit Credit Counselors Are Yesterdays Bill Collectors!
Here's a dirty secret, today's "non profit credit counselors" are often just front organizations paid lucrative commissions by creditors to keep consumers from declaring bankruptcy!In the "debt collection biz", creditors will sell your outstanding debt along with the debt of hundreds of others to a collection agency for cash up front.The collection agencies will work this debt until they've made all the money they can.
Credit Report - How Your Credit Score is Determined
Most consumers are aware that they have something known as a credit report that is used to determine whether or not they would qualify for a loan. Fewer are familiar with the FICO score, a creation of the Fair, Isaac, and Co.
Credit Cards - A Blessing or a Curse?
Owning a credit card can be quite an advantage. Whethermaking online purchases, booking an air ticket or a hotelroom on the phone or simply being in need of someemergency cash, having a credit card can be a big help.
Choosing The Credit Card That Is Right For You
Credit cards represent an important part of our financial lives. Having the right credit cards is essential and will make a big difference to your finances.
What is Credit Card and Debit Card Blocking?
Have you ever been told you were over your credit card limit, or had your debit card declined, even though you knew you had available credit or money in your bank account? If this happened shortly after you stayed in a hotel or rented a car, the problem could have been card "blocking."What is Blocking?When you use a credit or debit card to check into a hotel or rent a car, the clerk usually contacts the company that issued your card to give an estimated total.
Credit Help for Real Estate Financing: Five Categories of Your Credit Score
1. Payment History -- 35%The number of accounts paid as agreed and a good payment history give you a higher score.
SuperCharged Secret 1 of 5 - Credit Card Utopia
I AM THE CONSUMER. AND I HAVE LOW-RATE SUPER-POWERS!Note: The following is part 1 of a 5 part series.