Do You Know What Credit Score Is?

Do You Know What Credit Score Is?

Do You Know What Credit Score Is?

Credit score is the metric used by lenders, such as lending banks, credit card operators, and even auto finance companies, to make decisions about whether or not to offer credit (such as a credit card or credit card). loan) and what this offer will look like (relative to the interest rate or how it will be paid).

In the following article, we will present in more detail key Credit Score information, including key factors that may affect a positive or negative score.

Why is credit score important?

Why is credit score important?

Credit Score is a decision-making tool that lenders use to help them assess the likelihood that you will repay your loan on time. Credit scores are also called risk scores because they help lenders assess the risk of you not being able to repay debt as agreed.

Having good credit is important because it determines if you qualify for a loan. Depending on the interest rate of the loan, this can mean substantial savings. A good credit score can also mean that you are able to rent the apartment you want or get the internet service you need.

Every time you set a big financial goal, such as becoming an apartment owner or buying a new car, your credit is probably part of this financing framework. Your credit score will help lenders determine whether or not you qualify for a loan and how good the loan terms will be.

Factors Affecting Your Score

Factors Affecting Your Score

The information that affects a credit score varies depending on the scoring model used. However, the main ones include:

  • payment history for loans and credit cards;
  • credit utilization rate;
  • total debt;
  • public records, such as bankruptcy;
  • How many new credit accounts you have recently opened;
  • positive registration;
  • other information not disclosed by Score operators.

How To Improve Your Credit Score

How To Improve Your Credit Score

If you have reviewed your credit information and found that your credit score is not exactly where you thought it would be, you are not alone. Because your credit score uses information extracted from your credit report, your credit activity provides an up-to-date database of how you are responsible for the credit you are currently using.

Having a clean name is the minimum. To get a high score, you also need to have bills in your name and pay them on time (or earlier); update the registration data in the scoring company (Serasa, generally); buy on time; create a positive register, among other attitudes.

If you want to grant simpler, more practical and more secure credit, check out our payroll loan platform! Visit our website and register your company for all the information or contact us now!

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