Checking your credit score regularly is one of the best gifts you can give yourself. Your credit score is more than just a number banks use to determine what you can borrow for a home, car, or personal loan. It’s also the number future employers use to determine whether they’re going to hire you, and it’s the same number insurance companies use to provide you with car insurance quotes. If your credit score is low or if there are mistakes on your report affecting your score, you will pay more interest charges and fees for any loans or services. You might even lose a potential job if your score is low.
Checking your credit helps you find and fix mistakes on your credit report before they become a problem for your financial future. It also allows you to determine whether credit repair companies are something you could benefit from to increase your score and your financial future. To keep your credit profile in check, learning to check your report is vital.
Contact the Three Credit Bureaus
Equifax, Experian, and TransUnion are the three major credit reporting bureaus, and this is where you go to find your scores. Each one is required to offer you one free copy of your credit report each year. All you must do is make the call and ask for the report by proving your identity. This requires providing personal information to each credit bureau to verify you are the person you’re claiming to be. Each company will issue you a copy of your report.
AnnualCreditReport.com is another reputable source for a copy of your credit report. This company provides one free copy to each consumer every year. The best course of action is to obtain a copy of your credit report each quarter from one of these sources to obtain four free reports each year. Doing this each quarter allows you to check regularly for misinformation, mistakes, and on the progress of your credit score.
How Credit Scores are Factored
Education is the most important aspect of improving your credit score. When your score is lower than it should be, you must improve it. This is not an easy task, because it takes time. Credit scores are calculated using very specific information.
– Payment history
– Credit utilization
– Length of credit history
– Account inquiries
– How many types of credit you utilize
The most important factor in determining your credit score is your payment history. This is worth 35% of your total score. The amount you owe is the next most important factor, and the length of your credit history is the following most important. This is why credit repair agencies and financial experts recommend you never close old credit accounts when you receive new ones, as it shortens the length of your credit history and affects your score in a negative manner.
How Credit Education Helps Consumers
Education for credit repair purposes is widely available to anyone who wishes to learn more about their credit and how to improve their scores. It’s information that’s useful for all consumers regardless of their credit score. Credit repair involves paying off debts as quickly as possible, learning to utilize less than 30% of your available credit at a given time, and it involves learning to make all your payments on time every month.
It’s not just your ability to secure a mortgage or car note that’s affected by your low credit score. Employers are sometimes hesitant to hire employees with a low score, particularly when those employees are applying for jobs in the financial sector. Insurance companies, utility companies, and even cell phone companies search credit scores to determine whether customers must pay a deposit when they open accounts. A low credit score is costly, but it’s not something you must live with if you take the time to learn how to manage your score, your finances, and your future.
By: Kevin Faber