A High Credit Score Is Golden
Follow the numbers. Creditors and lenders take your credit score very seriously and so should you if you want to receive preferential treatment from them. Lenders and credit card companies offer borrowers with high credit scores better financing terms and interest rates. When you need a mortgage, car loan, student loan or insurance your credit score will have an impact on the options you are offered.
Save Money With A Good Number
Credit scores range from 350 to 850. The closer your number is to 850 the better. At that level creditors and lenders consider you a low risk therefore offer you the better insurance premiums and loan interest rates. You become a high risk and pay more when your score drops below 750.
Make Your Score Golden, Learn The Breakdown
Some parts of your credit score have a greater impact than others. Here’s the breakdown:
Payment History (35%)
Timely bill payment accounts for 35% of your score, needless to say, your payment history has the greatest impact. Also included is negative collections and delinquent accounts, so be careful.
What You Owe (30%)
How much you owe makes up 30% of your credit score. That’s a fairly large chunk. Keep your account balances low and keep the number of accounts that have balances to a minimum.
Your Credit History (15%)
The length of time you have been tracked by a credit report makes up only 15% of your credit score. But don’t take that lightly just because it’s only 15%, your credit history makes up a good portion of your score. The longer you have had a credit history the better.
Types Of Credit (10%)
Your credit mix makes up 10% of your score. By using installment and revolving credit it looks better than if you always just use one type.
New Credit (10%)
The new credit card accounts you have recently opened compared to your total number of active accounts makes up 10% of your credit score. Try to minimize the number of new accounts you open if you are trying to improve your score.
If you are trying to pinch pennies, can’t seem to make ends meet, are living from pay check to pay check you might think about checking out your credit score, it could be costing you money.