Did you notice an increase in your credit score? If you have not checked your credit score recently now is a good time to do so. You may be pleasantly surprised. A recent overhaul by the three major credit bureaus in the way credit scores are calculated has improved millions of consumer credit scores. Some things, like tax liens and civil judgments, have been removed. And millions of collection accounts have been removed. These reporting changes have led to an average 11 point increase in credit scores. For some consumers, scores have increased by as much as 40 points!
Is a Good Credit Score Important?
Your credit score is a measure of how trustworthy you are in the eyes of lenders. Scores range from 300-850. The higher your score the better chance you have of getting a more favorable loan. Scores over 700 are considered good and will qualify you for better loan terms and better interest rate. This leads to a lower loan payment and will save you money over the term of your loan.
Don’t think the three big credit reporting bureaus are being nice at heart. The reporting changes were prompted by investigations by state regulators over reporting inaccuracies.
To improve or maintain your credit score, FICO recommends checking your report for inaccuracies. It helps to consistently pay bills on time, reduce your debt load as much as possible, and apply for credit only when needed.
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