Your Credit Score

Your credit score is a number that predicts how credit-worthy you are. It is based on information in your credit report such as your bill-paying history, the number and type of accounts you have, late payments, collection actions, outstanding debt, and the age of your accounts. A statistical program compares your information with consumers who have similar profiles, and determines a total number of points.

Your credit score guides companies and banks in their decision whether or not they will do business with you and on what terms.

Credit score numbers range from about 350 (low) to more than 800 (high). The vast majority of these scores are produced by California-based Fair Isaac Company. Fair Isaac collects credit information from all three of the large credit bureaus and computes a credit score (called FICO® score), which credit bureaus in turn use to determine many factors, including:

• Whether you qualify for a mortgage, and how much money you can borrow
• Whether a landlord should trust you to pay your rent on time each month
• What kind of limit you should have on your credit card
• What sort of interest rate will be available to you
• Whether you qualify for an increased credit line

According to myfico.com, in the eyes of most lenders, FICO credit scores above 700 are very good and a sign of good financial health. FICO scores below 600 indicate high risk to lenders and could lead lenders to charge you much higher rates or turn down your credit application.

You can find out your credit scores by contacting one or all three of the credit bureaus - Equifax, TransUnion, or Experian - or by going to www.myfico.com. To get your score more than once in a year from any of the three bureaus, you will pay on average a fee of $15. Since each of the bureaus may contain varying information, it is better to purchase credit scores from each reporting agency. You may also purchase FICO Deluxe from www.myfico.com, which provides credit reports and scores from all three bureaus.

How can I better understand my credit score history - and how can I affect it? Learn more