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Your Credit Score, demystified.
Your Credit Score, demystified.
Your credit scores are simply an indication, or rating, of the likelihood that you will make your payments as agreed. A digital character reference, provided to authorized creditors, that include your current and past multi-year credit obligations. Although unlike the outcome of a hockey game or a final exam in school, your credit score is not as clear-cut. The confusion with credit scores is due to the fact that there is multiple credit gathering institutions or credit bureaus such as Equifax, TransUnion, Experian and Credit Unions, that produce these mysterious reports. These companies harvest your credit information from banks, credit card companies, utilities, finance companies and various other creditors that you may have engaged with over the years.
However,
However,
Creditors are not obligated to report to any of the bureaus. In fact, many will report only to one agency, and some may not report at all. The inconsistency in providing your payment history to all of the credit bureaus compounds the confusion and is one of the major reasons why variances in the credit scores occur. For example, a credit union may elect to access your financing history through a credit bureau yet may also elect to omit reporting your positive repayment history you've made with them. Your credit scores in this case are not a true reflection of your financial credibility. Another reason for diverse scores are the method of calculating a rating, the various credit bureaus may use the exact same credit information differently within their calculations. Equifax, in comparison to their competitors, may put a greater or lesser emphasis on a specific type of data collected. What one credit bureau may deem relevant may be irrelevant to their competitors. Thus, an eluding credit score.
There is more,
There is more,
In addition to examining your credit scores, an understanding and accommodating creditor will utilize a variety of other factors when determining their decision on granting you credit. A creditor relying solely on a computer generated indicator, a lifeless and unforgiving calculation, will undoubtedly overlook countless opportunities of credit worthy relationships. With the introduction of a myriad of lending options, the prospect of the lending world is forever changing for the benefit of the consumer.
In conclusion,
In conclusion,
A good understanding of your credit worthiness and a genuine desire to maintain a strong credit reputation is vital throughout our lives. Our electronic world is increasingly capturing and disseminating digital character references, ensure your credit status is being evaluated accurately.
You can obtain your personal credit reports at the links below.
You can obtain your personal credit reports at the links below.
*** Dispute incorrect information on your reports at Equifax or TransUnion ***
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