Good grades are the mark of success in school, and goof credit scores are evidence that you’ve maintained financial responsibility. Once you have a high credit rating, however, how safe is your score?
Credit reporting agencies collect and assess data to determine creditworthiness, giving you a grade that can range from 300 to 850. The higher your score, the better your credit. You’re rated based on your payment history, responsible financial handling, and income, among other factors. If you have a social security number and a credit history of any kind for longer than six months, you have a credit score.
What’s the Difference Between a FICO Score and a VantageScore?
A FICO score is the most commonly used credit score. Based on a formula devised by the Fair Isaac Corporation, it’s the one thing that may stand between getting a loan or getting turned down. Your FICO score might even affect your interest rates and terms on various types of loans.
Another number that banks and credit card companies look at is your VantageScore. This newer rating system, which is less influential, was developed by three major credit bureaus (Experian, TransUnion, and Equifax) and is used as a risk score that helps lenders to determine your creditworthiness.
Surprising Factors That Affect Your Credit
The obvious culprits that can drag your credit score late payments, judgments or collections, and high debt levels. However, there are some seemingly insignificant actions that can also have a negative effect. Did you know that something as simple as not paying your library fine can count against you? Contrary to popular advice, paying off a card and closing it or moving all of your debt to one card can sometimes do more harm than good.
How Do You Keep Your High Score Safe?
Keeping your score safe isn’t too difficult; it just takes a little discipline. Problems come up and sometimes you get behind. While you need to have some credit history to have good credit, it’s important to keep your debt ratio under control.
Instead of moving debt from one account to another, pay each of your accounts down to lower the ratio. Protect your data and don’t give other people access to credit cards and other lines of credit.
Want to keep your score safe? Start by checking your credit score today: Click Here