Your credit report is necessary in measuring your credit worthiness. Having a good credit report entails that you pay your bills as and when due. This means that you are capable of handling your funds well.
Credit report contain some vital information about you like your name, home or office address, telephone number, social security number, birthday, employment history, dispute statements, inquires, and public records made on your report. However, your credit history is the most essential part of it.
Your payment or credit history contains your transaction with retail shops, banks, mortgage, financial institutions, mortgage firms as well as other creditors. A credit score is a 3-digit summary of your credit history, in this case, the creditors will know whether or not you are creditworthy. Credit history also involves some information about the accounts you own, and late or missed payments.
You should monitor your credit score regularly; this will help you in having a good credit score. Feel free to go through the online credit report, so as to know whether the information in your report is reliable, accurate and correct.
Inaccurate information will drag your credit score down. if you have a low credit score, lenders may not give you loan or they may even give you a higher interest. Whichever way, your money will suffer terribly.
Ranges of Free Credit Scores
Credit scores are between the ranges of 300 to 850. This was a principle championed by Fair Isaac and company, popularly known as FICO. You can either check your credit from a reputable firm, though you will pay some charges or you can check it free of charge online, from the CreditScoreWiz.com, for example.
As noted above, it is not good to have late payment history, because they will negatively affect your scores. Bankruptcies and debt collections are within the ambience of payment history. Do not keep your card balances above 25%; it is even better to keep it less than that, maybe 10% or 15%.
It will not favor you if you open new accounts, because there is every possibility that they will conduct hard inquiries on your credit card application. Finally, before you apply for insurance or loans, make sure you check credit score very well, so that you can increase your chances of getting your insurance or credit application approved.