A credit score is a system which your creditors use to determine whether you qualify for the credit or not. In addition, the credit scoring system with Credit Repair Co credit repair virginia beach is used to determine the terms that your credit will be offered under. The system collects information such as; your pattern of paying bills, the types of accounts you own, the experiences you have with paying credit, and the number of years you have owned your accounts, from your credit report. The system thereafter statistically analyses the information statistically compared to other profiles and you are given your score. The credit score therefore determines the likelihood of you repaying your loans and repaying them on time. Interrelationships between Your Credit Score and Credit Report The contents of your credit report directly influences your credit score because the information that bases your credit score is derived from the score. This makes it very critical for you to be very keen on your credit report details in case there are some errors. You have the right under federal law to receive your annual credit score from the three credit bureaus, your score is gotten from the national credit reporting companies for a fee. How the Score is Developed In the course of determining your score, the national credit scoring companies analyses samples of information of random customers statistically so that they can discover the characteristics relating to the risk. Thereafter the risks are given a weight according to the strength of the predictor to determine whether it would be a bad or a good risk. Each company is entitled to its own credit-scoring model. The equal credit opportunity act curtails the credit scoring companies from using some of the customers information in coming up with the credit score. These characteristics include race, sex, origin, religion, or marital status. Age is allowed with a condition that any age is treated as equal. How to Improve your Credit Score The credit scoring system can be complex and different according to the different companies and types of credit. Since credit score is very important in your credit, life it’s always good to find ways through which you can improve the score in order to live a credit healthy life. These factors include: Paying your bills on time. Make sure you pay the credit you owe to the creditors within the stipulated time you had agreed. Paying bills late causes collection of the account or the account being declared bankrupt. These vices affect negatively your score thereby lowering it. Reduce amount of debts you have. Credit scoring systems analyzes your debt amount in relation to the credit limits. Having too many debts affects the report negatively. This will subsequently affect your scores if not managed. Reduce the credit accounts you have. You should minimize the amount of the credit accounts you have too many credit accounts are tiring to manage. Do not give yourself the pressure of offsetting many of your credits.
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