Factors Influencing Your Credit Score

Credit history is an important attribute of a successful financial life. Hence, it is very important to know what exactly constitutes it and produces an impact on your credit score. There are several significant factors which are taken into account while calculating your credit score.            1. Length of Credit History             Creditors like when a credit history is established and maintained for a certain period of time. It gives them an opportunity to track your behavior in the course of time and understand the risks. So the faster you start building your credit history, the better outcomes you would achieve. It is highly recommended to start this process at the student age. Besides, it is very convenient because a lot of lenders and credit card providers offer special favorable conditions for students.             2. Quantity of Credit Lines             If there are very few credit lines on your file, it is more difficult to predict your future payment performance and calculate all risks.  Besides, if other lenders believed in you and gave you credit, it is a positive sign. There should be a reasonable quantity of credit lines sufficient to showcase your payment habits and convince future editors that you are a low risk client. It is generally recommended to have 1-2 revolving accounts, a couple of installment accounts, one mortgage and auto loan.             3. Credit Limits on Existing Credit Lines             Higher limits on your credit lines indicate that other lenders have certain trust in you. Nowadays lenders are much more careful with credit and do not grant high credit lines or increase credit limits without significant financial prerequisites. It is a signal to the future lenders that you are trustworthy and [...]

By | 2017-01-06T21:32:07+00:00 August 25th, 2013|Uncategorized|0 Comments
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