Money Matters: What nobody tells you about your credit score

October 20, 2017 03:30

Sponsored by NEFE

Credit scores can seem complicated, with several different agencies tracking your credit and multiple factors used to determine your creditworthiness. But when you boil it down, it is really all about a few key factors: Paying your bills on time, keeping your balances low and not applying for too much credit too often. If you're able to successfully do those things, you'll be able to build and maintain a good score, so when it comes time for a major purchase and you need a loan, banks will look favorably on your efforts.

As U.S. News Money explains, although many factors go into credit scores, it's not as complicated as you might think. They also say that unless you're about to seek out a large loan, you don't need to obsess over your score. But they also point out that the higher your score, the further it might fall if you don't follow those three key steps. A single missed payment can drop a high score a hundred points. Balances that climb higher and several applications for credit can also chip away at a good number. Mistakes can hurt a credit score, but disciplined spending and payments over time will keep it in good shape.
 
To help your listeners/viewers/readers understand how credit scores work, talk with loan officers in your area. They can explain the factors they look for when considering offering a loan, and what would-be borrowers can do to improve their score to become better prospects for lenders.

Sponsored by the National Endowment for Financial Education
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