3 Credit Scores – The Measure Of Your Creditworthiness
When we wish to borrow money, our credit worthiness needs to be high. All that the lender needs to ensure is that they will get their money back before the loan is approved. Information on the borrowers are provided by credit bureaus to the lenders. The bureaus have access to the credit history of a person and by analyzing this, they come up with the person’s credit score. The credit score figure shows the credit worthiness of the person and the chances of the issuer of getting back the amount. When the credit score is high, the lender can know that it is relatively safe to issue the loan. Planning to apply for a loan – get informed about these three credit scores.
There are three separate American credit bureaus. These are, the Experian, the TransUnion and the Equifax credit bureaus. Each of them performs a statistical analysis of individual credit data, and comes up with a credit score. The extent of credit worthiness of the person is shown by this credit score. Different techniques are however often taken up for calculating the credit score by these three credit bureaus. And thus what the actual finding would be of these 3 bureaus can often differ. The credit score is generally calculated by an automated software. This software is created by Fair Issac Corporation (FICO). Hence, credit scores are also known as FICO scores.
In an individual credit report, all these three credit scores are considered to come to a conclusion. Apart from these three credit scores, each of the bureaus also calculate the VantageScore separately. The VantageScore ranges between 501 and 990. The FICO credit score varies between 300 to 850.
Did you know that you can get the credit score and that too free? There are many credit report monitoring services of the credit bureaus, and you will need to subscribe to any one of them. Such information about a person is also provided to the lender who can thus take a knowledgeable decision. These credit scores are crucial when it comes to accepting or denying the loan application.
But why for all reasons should you know what your credit score is? Did you know that there may be an error in your score, and thus you should try to find out if this is the case. The agencies often maintain your credit reports for up to 7 years and thus, it always makes sense to verify whether it is correct or not. So go ahead and find out how you can find out about your 3 credit scores and also learn whom to approach for this. You must definitely have the information about this.
Tags: 
