What is a Credit Score? This FinStream video discusses Credit Scores and why you should care about having a good one. The best way to improve your credit scores are to pay bills on time, pay delinquent bills and lower your credit card debt.

A credit score is a numerical expression based on a level analysis of a person’s credit files, to represent the creditworthiness of an individual. Essentially, it’s a measure used by lenders to evaluate how risky it might be to lend money or extend credit to you. Credit scores are calculated using information from your credit reports, which include your payment history, the amount of debt you have, the length of your credit history, the types of credit you use, and recent credit inquiries or new credit accounts.

The most common credit score model in the United States is the FICO score, which ranges from 300 to 850. Generally, a score above 700 is considered good, while a score above 800 is considered excellent. Another model is the VantageScore, which was developed as a joint venture of the three major credit bureaus (Experian, TransUnion, and Equifax) and also uses a scoring range that goes from 300 to 850.

Credit scores are crucial because they can affect your ability to get a loan, the interest rates you’ll pay, and sometimes even your chances of getting a job or renting an apartment. Therefore, maintaining a good credit score is important for financial health.

Watch these free FinStream TV streaming videos to learn more about managing debt and improving your credit score at this link: https://www.finstream.tv/videos/managing-debt/