A credit score is a complex mathematical model that evaluates many types of information in a credit file to help lenders estimate the risk they incur by lending someone money or providing them with a service like. Lenders use the credit score to determine whether a person qualifies for a loan, credit card or service and to determine the rates. Generally, the higher the score, the less risk the person represents and the better rates they will receive.At this time, Experian, Equifax, or TransUnion will provide you with a credit score for nominal fee. Consider purchasing your credit scores if you are planning a major purchase, such as a house or car. The bank or mortgage company you choose will determine your interest rate depending on how your credit score.

Items not included in your credit score include;

• Your race, ethnic status or marital status.
• Your age.
• Your income.
• The interest rate you are paying on a credit card.

Here is what does makes up your credit score;

1. 35% Payment History
2. 30% Amounts Owed
3. 15% Length of Credit History
4. 10% New Credit
5. 10% Types of Credit Used

Payment history has the biggest impact on your score. Paying bills on time is critical to maintaining good credit. If you cannot pay a bill on time, contact the lender and set-up a plan to get caught up as soon as possible.

The second biggest influence on your score is how much you owe on your accounts. On debt like credit and store cards, the maximum balance owing should be 30% – 50% or less of the available credit limit. For example, if your credit card has a limit of $1,000, the highest balance you should carry on that card is $500. Any higher and you run the risk of damaging your score.Length of your credit history and new types of credit refer to how long you have had accounts open or how long it has been since you opened new accounts. These categories also take into account how long the specific type of account has been open. Opening numerous accounts at the same time may appear risky and may reflect negatively in your score. Having an account on your credit report that shows a long history of on-time repayments benefits your score.The last piece of the score looks at the different types of credit you use. Having a mix of types of credit such as installment loans, credit or store cards, mortgage, and auto loans can be important in showing your ability to handle debt.Creating and maintaining good credit is a balancing act. Your score reflects only the information found in your credit report, so it is important to check the information in your reports at least once a year through http://www.annualcreditreport.com/ or by phone (1-877-322-8228). For more help understanding your credit score or credit report, contact an accredited credit counselor at 1-888-282-5899 or http://www.myfinancialgoals.org/. You can also access additional FICO score information at www.myfico.com.

Personal Information – name, social security number, records on file of previous addresses, etc.

Note the following items on this section of the credit report:

1. The file number is indicated; this gives Dana a way to notify the credit bureau of any errors in the report, by referring to this number.
2. The information shown on this section of the report is generally self-explanatory. However, there are a few items of personal data that Dana should strive to keep secure, in particular, her social security number and date of birth. Note that a portion of the social security number has been masked out–this is a desirable option when personal information is printed out.
3. Dana should examine all items, including the credit union’s record of previous addresses and employment history, and notify the credit bureau of any errors.

Account History – the history of an account can be viewed as a summary or in detail.

Dana should review the accounts displayed in the report, including the balances reported. By clicking on the show details link, she can get a listing of the payments she has made, and the status of each payment. Late payments will be flagged with the number of days the payment was late. It is important that Dana verify the validity of the report contents, because potential creditors, landlords, or insurance companies may be able to examine this report, and make decisions based on report data. Additionally, Dana’s credit score can be affected by contents of this report. The report may contain both active credit accounts and ones that have been closed.

Inquiries Section – will show inquiries by credit providers, landlords, insurance companies and others. A review inquiry is typically done by a company you owe money to ensure your credit is still in good standing. A promotional inquiry is typically done by a company who is evaluating your report for future credit – they may be planning to send you a promotional credit offer or other service.

Another type of inquiry that may appear on the report is an internal inquiry, initiated by Dana herself. If she finds an error on the report and notifies the credit bureau, her action will appear as an internal inquiry.

Public Records Information
Although not illustrated in the credit bureau report for Dana Thomas, a credit report may contain information from the court system that a potential creditor might need to know. For example, a bankruptcy, lien, judgment or failure to make child support payments could be reported, or an account that has been turned over to a collection agency.

Contact Information
At the end of the credit report, you will find contact information, in case you wish to contact the credit bureau. There are three approaches–over the internet, by telephone, and by mail. The appropriate information for each method will be supplied on the report.

You can opt to receive your reports by telephone or by mail, but the most efficient method is by access over the Internet – your reports can be in your hands within 15 minutes.

Review the information below so you are prepared with the information you will need.

1. Your name;
2. Your date of birth;
3. Your social security number;
4. Your current address;
5. The street name, town or zip code of a previous residence;
6. The name of a company or bank that issued you a credit card in the past.
7. The name of your mortgage or car loan company and your monthly payment.