If you watch any television or surf the internet, you are bound to come upon advertising from companies wanting to help you with your credit score. There is so much information about credit scores that it can be easy to take yours for granted. Your credit score is a tool that can help your financial future.
What Is a Credit Score?
A credit score is a rating of your financial activity generated by an algorithm. The most popular algorithm is referred to as FICO, and the creators of FICO claim it is used by 90 percent of American financial organizations, including 1st National Bank.
Data such as your debt to credit ratio, bill paying history, and credit management habits are used by the FICO algorithm to generate a number ranging from 300 to 850. Lenders who use your credit score generally like credit scores that are 700 or higher.
Why Should You Monitor Your Credit Score?
When you monitor your credit score, you can see when someone is trying to use your identity to open fake credit accounts. This is the best way to prevent identity theft and to prevent your private information from being stolen.
Monitoring your credit scores can also help you to create better credit habits that will increase your score. A higher credit score means quicker loan approvals, lower interest rates, no need for a co-signer, and faster approval for any other activity that requires your credit score. Here are 3 ways to improve your credit score.
Monitoring Your Credit Score.
The Fair Credit Reporting Act is a United States Congress law to help consumers keep track of their credit scores. According to the law, any American consumer can request one free copy of their full credit report every 12 months. Within this report, you can see your credit activity and contest any entries that are incorrect. You can monitor your credit history through three primary credit reporting agencies: TransUnion, Equifax, and Experian. Review your credit report now.
If you would like to monitor your credit in real time, then you can get one of the many credit reporting apps for your smartphone. With these apps, you are alerted whenever there is activity on your credit profiles, and you can take action immediately if you did not generate that activity.
It is important that every consumer understands their credit score and how they can monitor their credit profile. Good credit is the gateway to emergency funding, a mortgage and any other type of financing you may need. If you’d like help with your credit score, call our Client Care Specialists at 855.876.1500 or stop into any 1st National Bank location.