A person’s credit report is essentially an ongoing look at his or her personal information, and provides a deeper insight on how well the individual manages his or her finances, and pays their debts. The individual’s financial data is submitted to a credit reporting agency by creditors, debt collection agencies, the courts and other public or federal agencies. Once a note or comment has been made or added to the person’s credit report, it stays there for sometime. If the note is a positive one, it ensures that you’ll have an easy time availing of different forms of financing. A negative comment made by your creditor on the other hand, will have a detrimental effect on your purchasing power. Here’s a basic overview of credit score ranges. Standard Credit Score Ranges Credit scores generally vary a little bit, from one credit reporting agency to another. To develop the credit scoring system, a creditor generally weighs each of the major factors, based on how each of the factors predicts whether a person is deemed a good credit risk. Credit scores generally have a range between 300 and 850. Here’s a rundown of the standard score range. 300 – 499 – Bad Credit 500 – 580 – Poor Credit 580 – 619 – Low Credit 620 – 679 – Average Credit 680 – 699 – Good Credit 700 – 850 – Excellent Credit Regularly Monitor Your Credit Score According to credit experts, a good to excellent credit score is often weighed as a future sign of your credit value, and if your credit score is Good, then your future loan’s interest rates will certainly be lower than usual. A bad to poor credit score on the other hand, will usually allow you to get higher-interest loans, which are costly to pay in the long term. Always ensure that you regularly monitor your credit score, since if you allow your credit score to drop too low, then it may take a number of years for you to get it back to its desirable range. Who Are The Major Credit Reporting Agencies In The US? In the United States, there are three major credit reporting agencies, where most creditors submit their client’s payment history and personal information. The information submitted by your creditors to these credit reporting bureaus include date of account opening, type of accounts, payment history for each account, late payments, unpaid child support, overdrawn checks, or any foreclosures, suits, wage attachments, liens and bankruptcies that are derived from federal and state agencies. The major US credit reporting agencies include Equifax, Experian and TransUnion. Each of these agencies independently operates from each other. This helps to explain why their records differ form each other. If you’re disputing any inconsistencies in your credit report, you need to send updates and corrections to each agency, because these agencies don’t generally share information among each other.
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