Wednesday, April 7, 2010

Truths & Myths About Your Credit Score

Your credit score is a number between 300 and 850 that reflects your credit risk. It gives lenders a snapshot of how likely you will be to repay the loan they are considering giving you.

Checking Your Own Score Pulls it Down

    This is a common myth. Your score is not affected by you checking it. It is minimally affected when you apply for new credit accounts.

You Have to Pay a Fee to Find out Your Credit Score

    Yes, this is true. However, you do not have to purchase a monthly credit monitoring package to get it. You can pay a small one-time fee to www.annualcreditreport.com, when you get your free credit report.

I Have to Work with a Credit Repair Company to Improve my Score

    Often this is not the best way to improve your score. Pay your bills on time, lower your balances and reduce the number of credit card accounts you have.

A Bad Credit Score Never Changes

    False; you can improve your score by taking proactive action like paying down credit cards and paying every bill on time.

Minorities are Treated Unfairly about Credit Scores

    Age, gender, race, and marital status are not included in your credit report all. It is only credit-related information.

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