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How to Check Your Credit Score

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Tips on How to Check Your Credit Score

Credit scores can be a scary thing. In a nutshell, they’re a specific number credit bureaus assign to you, one that quickly encapsulates your entire credit history and assesses your financial credibility as an individual. Although they’re merely comprised of a three-digit number between 300 and 850, they directly influence some of the most important financial facets of your life, from the mortgage rates on your home to the potential loans available to you as a student or a first-time car buyer. If that wasn’t enough, bad credit scores also make it tougher to start a small business, obtain insurance, and even obtain a job in some situations — an issue that has only become more pervasive since the economic collapse of ’08 and a general tightening of credit standards by regional banks.

Like most scores, you credit score is a culmination of multiple components (in this case five). The first and largest portion of your scores relies on your payment history — whether you’ve paid your bills on time or neglected them — but it’s quickly followed by the amount of money you owe, the amount and type of credit you possess, the length of your credit history and how long it has been since you last opened a credit line. Your given score is a crucial factor, if not the most important factor, potential money lenders use to evaluate your risk level. The higher the credit score or rating, the less risky you’ll likely appear and the greater the economic opportunity afforded to you will be. Or, you hope so, anyway.

However, although each of three major credit reporting agencies — Equifax, Experian, and TransUnion — offer a free copy of your credit report once a year in compliance with the Fair Credit Reporting Act of 1970, none of them offer free access to your official credit score unless you pay an upwards of $5. Thankfully, credit-monitoring websites like Credit Karma and Credit Sesame offer free estimates of your credit score without adversely effecting your credit, whenever you’d like and as often as you’d like. It’s the closest thing to an official FICO score as you’re going to get.

Here’s our quick guide on how to check your credit score.

Check your credit report (and score estimate) using Credit Karma
Step 1: Create a Credit Karma account — Navigate to the main Credit Karma homepage, click the orange Get started now button and enter your appropriate email address and password before click the blue Next Step button to create a user account.

Step 2: Enter your personal information — Once directed to Step 2, enter your personal information in the resulting text fields, quickly listing your name, current address, birthday, and the last four digits of your social security number among other information. When finished, click the blue Next Step button to create a user account.

Step 3: Confirm your identity — Once directed to Step 3, confirm your identity by correctly answering the three or four resulting questions in order. To do so, check the bubble directly left of the correct answer below the corresponding question. Questions vary, but they often include information regarding your previous county of residence, loans and other pertinent information.

Step 4: View your credit score — Once properly completed, your TransUnion Credit Profile will be properly linked and verified. Generally, a score hovering around 650 is considered okay, with a score an upwards of 700 being good. Anything below 600 is trouble. More at HOW TO CHECK YOUR CREDIT SCORE

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A Guide to Credit Score Scale

“Where you fall on the credit score scale is important. Let this guide help you. Check it out now!”

All About Credit Score Scale

Our financial lives are dictated with terms such as credit score, credit ratings, credit history and so on. These are the terms which often crop up when you are applying for loans or credit cards. No money lender or a finance institution approves a loan without reviewing the applicant’s credit scores and credit history. Although, most people have a vague idea regarding what are credit scores, most of them are unaware about the credit score scale.

Credit Score Scale Guide
Credit score is a statistical technique of determining the probability of an individual repaying his debt within a specific period of time, by evaluating and analyzing his previous credit history. In short, it is your creditworthiness represented by a number. The evaluation and analyzing work is done by three credit bureaus namely, TransUnion, Experian and Equifax. These bureaus have their own parameters and mathematical formulas for deriving a person’s credit score. The software program that uses the mathematical formulas to find credit score is devised by Fair Isaac Corporation (FICO), hence the score is also called FICO score. The scores derived by each of these bureaus may vary slightly, owing to the differences in the information in their databases.

Typically, following parameters are taken into consideration while deriving a person’s credit score. A fixed weightage is assigned to each of these parameters, which is as follows:
Payment history (35%)
Outstanding current debts (30%)
Length of credit history (15%)
Types of credit accounts owned (10%)
New credit applications (10%)
Credit Score Scale Chart

The FICO scores are expressed in a numerical range of 300 to 850.

Excellent
The credit scores between 760 to 849 are considered as least risky with a very high creditworthiness. The credit score of 850, which is an ideal credit score is the highest score possible in this range. People with excellent credit scores are entitled to fastest approvals and enjoy lowest possible interest rates.

Great
The next best category is ‘great’ with credit scores in the range of 700 to 759. People in this credit score range also enjoy almost all the privileges as those with excellent ratings.

Good
Good credit score range is a category in which most Americans falls. Credit score range of 660 to 699 is not a problem while seeking loan approvals. However, you may not get the best possible interest rates, enjoyed by the above two classes.

Fair
Credit score range of 620 to 659 is considered as low to medium risk. Although getting loans may not be an issue, getting them at affordable interest rates certainly is. People with fair or average credit scores should look for ways to improve credit scores so that they too can enjoy good interest rates.

Poor
You may have to run from pillar to post to obtain a loan, as money lenders regard poor or bad credit scores as high risk. Even if you manage to obtain a loan, you will have a tough time keeping up with the payments, owing to very high interest rates.

Very Poor
People who have very poor credit scores below 580 should consider credit repair before they approach a loan institution. Consistent efforts towards credit improvement may eventually help you attain a better credit score range. More at Credit Score Scale Guide

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