What Determines Your Credit Score
Your credit score is an important number that can determine your financial reliability or credit risk-basically how likely you are to repay a loan and make payments on time. It is a complex mathematical model that depends on a multitude of factors. To help make it easier to understand how your credit score is calculated, here are a few important aspects of your finances that determine your credit score:
Payment History-This includes your account payment information, whether you have filed for bankruptcy, how long overdue payments are, the amount that is past due, and how long it has been since you've experienced any of the proceeding issues.
Amounts Owed- The entire amount you owe in every single account you have is considered. This includes the number of your accounts with balances, the proportion of credit line used, and how much you still owe on current loans.
Length of Credit History- As you might expect, this is the amount of time you have had a credit line open, as well as how long it has been since your accounts have been used.
New Credit- The number of recently opened accounts and how frequently you open them. If you have only a few accounts, but they are opened at the same time, this might affect your credit more than you believe.
Types of Credit Used- Types of credit include loans, mortgages, retail accounts, and credit cards.
Remember that credit scores can change over time, reflecting your current financial behavior and length of credit history. Keep an eye on your credit score, especially if you are planning to stop in to Titus-Will Ford to purchase a new car.