Credit score play a very vital role in human’s life and the credit score ranges from good, fair to poor. A credit score helps you financially from the banks and other institutions. If you have a poor score then you might be thinking how to fix my credit score. Well the answer to how to fix my credit score is to pay the bills well in advance from the due date and clear all the debts as soon as possible. It is good to remember the sentence “check my credit rating”. There are various score related to a credit and the credit scores explained will help you to know if you are eligible to apply for a loan or not.
How to check my credit rating?
If you want to get a credit card or any kind of loan from the credit companies, then you need to know if there is a worth in your credit. Only if you possess a nice credit you will be able to get loans at less interest rate. You can make use of online calculators to know an approximate value of your credit score. All you need to do is to get the credit reports from the credit agencies: TransUnion, Equifax and Experian. Then you need to enter the values prompted by the online calculator which will be based on the credit reports. In this way it will calculate the score based on the inputs you give. They are not exact but fall in the same range as that of the FICO score. There are various credit scores explained below which gives you an idea about a score being good or bad:
- 700+: This shows that the score is excellent and even if you apply loans with this score, you qualify instantly with an additional benefit of getting less interest rate on the loan you apply.
- 680 to 699: This is also a good credit score and higher the score, the better it is. You will be at minimum risk.
- 620 to 679: This score is considered okay and there are fewer chances for the loan being sanctioned. With this score, you will also get higher interest rate which is a big time disadvantage. Sometimes you might not get qualified to get a loan too.
- 580 to 619: This is a poor credit score or you can even call it as sub-prime. If you have this score then you will really have a tuff time in getting loans from the banks. Even if you get offers from the banks for loans, the interest rates will be like skyscrapers. You need to work a lot in order to improve your score.
- 500 to 579: This is categorized as “damaged” score because people possessing this score will come under the category of: bankruptcy, charge-off, foreclosure etc.
You need to remember always that the credit history will increase the ability to get loans and credit cards from banks and other financial sectors. You need to make a habit of checking the credit reports and if in case you find any errors in them, then you need to immediately make a request to the credit agencies to rectify the errors and get a fresh revised report. Apart from contacting them through phone, you will need to write a request later and attach certain residence proofs along with the report in which there is a mistake. You need to be very specific in writing the request letter as to which point the mistake has been made. Once you find the errors, you need to bring them to notice to the credit agencies within 30 days or a month as this can also help you in increasing the credit score.