What are credit scores and their meaning?
Credit scores are numbers which range from 300 to 850. These scores are computed on the basis of credit scores. They are then processed through software to get these numbers. The credit reports are based on payment histories of debtors, types of loans taken in the past, default and non payment history, credit card history and various other factors are considered while making these reports. The credit scores are vital numbers for evaluating the creditworthiness of debtors. Scores of 300 to 499 mean very bad crediting, 500 to 580 are poor credit scores and 580 to 619 are low credit scores. The scores of 680 to 699 are considered to be good credit scores while the scores of 700 and above are excellent credit scores.
How to access your free credit scores?The free credit score are provided by the three main credit bureaus. As per the FCRA or the Fair credit reporting act three main credit reporting bureaus have to provide all citizens with a free credit report. This credit report has to be made at least once a year. The consumers can change the time for availing these reports and can access three different credit reports, every 4 months, from each of the bureaus. This way they can get the latest reports and also check the errors on the same. Though the credit reports are not provided free of cost by applying for the same along with free credit reports can reduce the cost. There are sites which provide free credit reports also.
How does the free credit score help you?By accessing the free credit scores you can evaluate your creditworthiness. Since all lenders check the credit scores before providing loans and mortgages. If the credit scores are poor or bad then the chances of getting low interest loans are eliminated. Before applying for loans or mortgages the credit scores should always be checked. In case the scores are poor, then there are remedial methods to improve the same. Also detecting errors in credit reports can help in improving your credit scores.
Improving your credit scoresOnce you access your free credit scores there are various ways of improving the same. These methods include solutions like debt consolidation loans, debt reduction and negotiations and various other methods. Good credit scores are vital for financial benefits like getting loans and mortgages at lower interest rates.
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