What is a Credit Score?A credit score represents an individual’s financial and credit standing and ability to obtain financial assistance from lenders. Lenders use the credit score to assess a prospective borrower’s qualification for a loan and the specific terms of the loan. Essentially, it is used to determine the borrower’s ability to pay back the borrowed amount. A consumer credit reporting agency provides credit score assessments, such as Equifax or TransUnion.Who Uses Credit Scores?Any organisation that lends money as a source of business uses credit scores to assess a borrower’s eligibility. Such organisations include banks, credit card companies, fintech-based lenders, insurance companies, landlords, government agencies, and mortgage companies.It can be any individual or organisation that seeks to lend someone money or enter into a contract that will require another party to pay them back in a predetermined time.How to Improve your Credit Score
- Pay your bills on time
- Reduce your overall loan amounts
- Manage credit cards effectively
- Do not buy what you can’t afford
Evita Veigas
2 min read