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BUSINESS & FINANCIAL MATTERS

Improving Your
Credit Score

Credit Card

A credit score is a numerical expression of how credit-worthy you are. A credit score is usually determined by how likely you are to make your payments on time. It takes into account information from your credit report, including your credit card companies, your banks where you have or previously had loans, and almost anyone else who's considered you for credit. ​

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FICO scores are among the most widely used. They range from 300 to 850, and each range determines how likely you are to get credit, what interest rate, and how much it will cost you to borrow money.

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The average credit score is around 718. A score of 760 or higher usually gets the best rates.​

Score 800+

Your score is well above the national average and demonstrates to lenders that you're an exceptional borrower.

Score 740-799

Your score is above the national average and demonstrates to lenders that you're a very dependable borrower.

Score 670-739

Your score is near or slightly above average, and most lenders consider this to be a good score.

Score 580-669

Your score is below average. Some lenders might approve loans with this score.

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Different credit scores like FICO or VantageScore use slightly different methods to calculate your score. But in general, your score is based on five factors—here are recent FICO weightings:

  • Your payment history (35%)

  • How much you owe (30%)

  • How long you've been using credit (15%)

  • Number of new credit accounts and applications (10%)

  • Types of credit you use (10%)

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Late payments or missing payments can lower your credit score more than any other factor. Making regular, on-time payments is one of the best ways to bring it back up.  Keep your credit card balance low; hard inquiries when applying for new credit can also impact your credit score.  The longer your credit card accounts are open (and in good standing), the better it is for your score.  Every year, you can get a free credit report from the credit reporting agencies like, TransUnion and Equifax.  You can also check out CreditKarma.com.   After you view your credit report, make sure that you dispute anything that is reported incorrectly by contacting the credit reporting agency, who will investigate it and make any necessary changes to your credit report.

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By Jason Torrents

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