Credit Determinants - The Good, the Bad, and your Payment History
Your credit score. This all-important financial determinant is a bit of a mysterious thing. What is it exactly and how does it affect your ability to say, purchase get an auto-loan? Fret not! We'll confront these questions head-on. Hopefully, by the end of this article, you'll feel more knowledgeable regarding your credit score and what factors affect it.
The General Rundown
Your credit score is a number that indicates how well you're able to manage your credit. Three consumer credit reporting bureaus handle all credit score calculations: Equifax, TransUnion, and Experian. All scores range from between 300 and 850, the higher the score the better. Essentially, this number is a condensed indicator of many factors that provides an indication of credit responsibility (how likely it is that you'll repay your loans on time). Your credit score breaks down into percentages based on categories: payment history (35%), outstanding debt (30%), length of credit history (14%), types of credit used (10%), and account age (10%).