Credit score is the three digit number which is useful for determining your credit worthiness
. When you surrender a request for any credit facility to fulfil some of your necessities it will be beneficial that you view your credit scores before pertaining for the credit facility. This is because every credit institution will view your credit rates. This assists them to find out whether you are applicable or should they judge you worthy enough to provide you credit. It also aids them to take decision regarding the amount to be credited and the rate of interest to be charged.
The three government department that is the Equifax, TransUnion and also the Experian supply the annual credit score to the customers. The Fair Isaac Corporation has given this facility to citizens to keep them updated with their credit mark in the fiscal market. Therefore, the credit score is also known as the FICO score.
The FICO score is divided into the following categories:
720-850 - this is measured as best score
700-719 - it is encouraging for better terms
675-699 - it is a better score range
620-674 - it is not good for better terms
560-619 - difficulty in acquiring credit
500-559 - it is better time for advancement
The annual credit score is formulated taking into consideration the following particulars. They are expense history, amounts owed, duration of credit history, recent credit, kind of credit used.
If the grade is above 700 the customer is considered as an excellent credit borrower but if the customer ranks below 300 he or she needs to improve a lot. This improvement can be done by paying the debts, maintaining credit limit, using less credit facility, and spending a smaller amount for redundant things. This will make you advance in your credit score on your annual report.