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Anyone who has checked into their Credit »”>credit score has probably found the rating scale to be somewhat confusing. There are a bunch of numbers, each meaning something different. Understanding how this rating works will help you to read your credit score effectively.

There are several pieces of information reviewed by companies when they build your credit score. These factors include the following:

- Past Payment History - Timing of Bill Payments - Outstanding Debt - Credit History

If you have a great deal of debt or you don’t have a very long credit history, you will receive a lower credit score even if there are no “black marks” against you.

Recently, credit applications take your credit score into consideration. Applying often for credit by filling out store applications for credit cards will cause you to receive a lower score. High amounts of credit card debt at high interest rates will do the same damage.

700 or higher is considered to be a good credit score. Being awarded credit at low interest rates should not be a problem if you have a score of 700 or higher.

With a score of 450 to 650 points to that your credit score needs improvement. Finding a loan or qualifying for a credit card t this score will be more difficult unless you have some type of security. Considered to be a higher risk, higher interest rates will likely be an issue as well.

If your score is below 450, your credit is in need of some serious help. At this level you likely won’t be able to qualify for a loan or credit card until you pursue some form of credit counseling to improve your score.

To improve your rating, check out the many sources that can assist you. Credit counseling services are available online as well as in the telephone book and many offer their services for free. Assessment of your financial situation is available and advice to improve your credit score will likely move you toward your goal of a higher credit score.

Filed under: Repair