What's My Credit Score Mean And How Important Is It?
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by: Ben Sparks
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Word Count: 391
Date: Tue, 25 May 2010 Time: 12:44 PM
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A common question these days is "What's My Credit Score Mean and How Important is it?" A credit score can range anywhere from 300 to 850. 300 is the lowest score possible, which would be very bad credit. 850 would be the highest score possible, meaning perfect credit. A credit score is very important in determining if someone qualifies for a loan, credit card, a mortgage, or even a cell phone.
If someone would like to check their credit score they can contact a credit reporting agency. There are a few different credit reporting agencies to choose from but it is best to contact each one because each one reports a credit score a little differently.
Everyone should know their own credit score. A credit score plays a huge factor in determining whether or not one can be approved for credit. Having bad credit means that most likely a loan will get denied. It can be a very long, hard process trying to fix bad credit. If someone is a victim of identity theft, that can also take a long time to get resolved.
To have good credit means that people need to make credit card and loan payments on time. Missing payments will hurt the credit score. Having high balances on credit cards can hurt the debt to income ratio which will negatively impact the credit score. Having too many lines of credit or loans will raise ones debt to income ratio which can also look bad on the credit score.
If someone is having trouble fixing their credit, then a good thing to try is to get a secured credit card. This is important for anyone who plans on purchasing a home or needing a vehicle loan. A lot of companies offer secured cards and they normally report to the credit bureau which will help build some good credit history. Just be sure to make payments on time every month and not to max out the card.
Having good credit is very important. Most people want to purchase a nice house or a nice car one day and it is hard to do either without good credit. It is a good idea to always monitor your credit and work on things that are negatively impacting it. This will pay off in the end.
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