A credit score is a numerical expression based on a statistical analysis of a person's credit files, to represent the credit worthiness of that person, which is the perceived likelihood that the person will pay debts in a timely manner.

A credit score is primarily based on credit report information, typically sourced from credit bureaus / credit reference agencies.

Lenders, such as banks and credit card companies, use credit scores to evaluate the potential risk posed by lending money to consumers and to mitigate losses due to bad debt. Lenders use credit scores to determine who qualifies for a loan, at what interest rate, and what credit limits. The use of credit or identity scoring prior to authorizing access or granting credit is an implementation of a trusted system.

Credit scoring is not limited to banks. Other organizations, such as mobile phone companies, insurance companies, employers, and government departments employ the same techniques. Credit scoring also has a lot of overlap with data mining, which uses many similar techniques.

What does the credit scores mean?

The higher the score, the better your credit rating. In general, a credit score can range from 300 to 850. Most scores fall within the 600s and 700s. The boundary between a standard loan and a higher cost loan, also known as a subprime loan, is generally considered to be a credit score of 620. A higher credit score generally means you will have an easier time obtaining credit and you should be able to get credit on better terms and at a lower cost than someone with a lower score.

How can I get my credit score from a lender?

In some cases, you are eligible to receive your credit score for free. If you are applying for a home loan after December 1, 2004 your lender is required to give you your credit score for free if the lender uses credit scores.

If you are not eligible for a free credit score from a home lender, you may purchase your credit score directly from the consumer credit reporting agency.

You may contact the three major consumer credit reporting agencies at:

800 685-1111
Get Your Equifax Credit Report Now!
P.O. Box 740241
Atlanta, Ga.
30374-0241

888 322 5583
http://www.experian.com
P.O. Box 2002
Allen, Texas 75013

800 888-4213
http://www.transunion.com
P.O. Box 1000
Chester, Pa. 19022

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