Need Credit or Insurance? Your Credit Score Helps Determine What You’ll Pay

use credit scores to decide whether to approve … Higher credit score means you’re probably less of a risk, employers ….

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Need Credit or Insurance? Your Credit Score Helps Determine What You’ll Pay
What is credit scoring?
Credit scores and credit reports
How is a credit scoring system developed?
What can I do to improve my score?

  • Have you paid your bills on time? You can count on payment history to be a significant factor
  • Are you maxed out? Many scoring systems evaluate the amount of debt you have compared to your credit limits.
  • How long have you had credit? Generally, scoring systems consider the length of your credit track record.
  • Have you applied for new credit lately? Many scoring systems consider whether you have applied for credit recently by looking at inquiries on your credit report.
  • How many credit accounts do you have and what kinds of accounts are they? Although it is generally considered a plus to have established credit accounts, too many credit card accounts may have a negative effect on your score.

Are credit scoring systems reliable?
What if I am denied credit or insurance, or don’t get the terms I want?
If you’ve been denied credit or insurance or didn’t get the rate or terms you want, ask questions:

  • Ask the creditor or insurance company if a credit scoring system was used.
  • If you get the credit or insurance, ask the creditor or insurance company whether you are getting the best rate and terms available.
  • If you are denied credit or not offered the best rate available because of inaccuracies in your credit report, be sure to dispute the inaccurate information with the credit reporting company.
Download Need Credit or Insurance? Your Credit Score Helps Determine What You'll Pay pdf from www.ftc.gov, 6 pages, 320.29KB.
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