Breaking credit score myths

Breaking Credit Score Myths-You Need To Know This!

We are all familiar with the terms credit report and credit score.  People’s credit score is a sensitive subject. Your credit score can have a significant impact on your financial well being. There is a lot riding on your credit score: interest rates on your loans, your ability to buy/rent a home, buy a car, even get a job. It is a an indicator of your financial responsibility if you will.

credit report and a credit score are not the same thing

First thing first, you need to understated that credit score and credit reports are 2 different things. A credit report is a report that contains a person’s credit file maintained by a Credit Bureau (i.e Experian – Transunion – Equifax). The information in that file is than translated through a complex mathematical process to determine your credit score, which is a  number that usually ranges from 300 (bad) to 850 (perfect).

Is checking my credit score bad?

People often assume that checking their credit score will have a negative effect on it. Well if a creditor check your score when you are applying for a loan there is a small chance that it will have some negative effect on your score.Your personal  inquires however will not lower your score.

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Knowing my score  and managing my credit report is only important when I’m applying for a loan

You already know that late payments or unpaid balances will lower your credit score. Even if you are the most organized person and pay all your bills on time you still might be a victim of identity theft. That is why it’s wise to check your credit report frequently for signs of fraud. If someone obtains your social security number, only a few additional pieces of information are necessary to commit a fraud in your name. Common types of identity theft include fraudulent bank accounts, credit cards, utilities, and loans. According to the FTC, victims of identity theft spend an average of 175 hours and $800 to clear their names. Early detection is the key to avoid suffering long-term financial consequences. So make sure you check your credit report and score frequently, even make it a weekly habit.

Your credit score and credit report is an important issue that should be taken seriously and has great impact on your financial situation. That is why it is wise to monitor it closely and make sure you are in good standing,If you want to view your credit score instantly you can do this at FreeScore360 where you can view your score for only $1 for 7 days.