Credit Score

Each credit bureau will calculate your credit score differently. However, all of the scoring models are uniform so that no matter what your credit score is, your credit rating will be the same. Therefore, your credit score is less important for you to know than your actually credit rating. Therefore, a credit score from Trans Union of 600 will hold the same weight as a 600 from Equifax.

Generally credit score range from between 350 to 850. While each individual lender will determine what score they are comfortable lending to, if your score is high you are in good shape.

Any credit score above 700 is very good, while if your score is below 600 you will have a very difficult time acquiring a loan.

Your credit score is based on five different variable that all of the major credit bureaus will look at:

  • Payment History—Do you make your payments on time? You frequently miss payments, so you sporadically miss payments. Have your accounts ever been turned over to collectors? A composite of all of these factors make up your payment history.
  • Outstanding Debt—Do you have a lot of outstanding payment on your credit time at the present? This will have a slight effect on your credit rating.
  • Average Balance—Do you usually carry a high balance on your credit card. This is not always a bad thing. You are a good credit card customer if you often carry a high balance but you make your payment regularly.
  • Credit History—How long have you had your credit cards?
  • Pursuit of new credit—How many times in the past have you inquired about getting new credit? The report will also show how recent these requests are. Types of credit you have—How many credit cards do you have and what kind of cards are they? Gas cards, diners club cards ect… These will all effect your overall credit score, although the two factors that you should always watch are how well you pay off your credit after you make a purchase and what your balance is. If you use your credit card a lot, and you always pay it off, you probably have a very high credit score. This will help you get more credit and the cycle will continue.

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