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Credit Information Library & Learning Center

What is my credit score and how can it affect me?

Credit scores summarize people’s credit reports. Everyone understands that credit scores are important numbers in people’s lives. Credit scores are calculated using an equation that evaluates multiple data points – called “score factors”. Score factors are derived from all three credit reporting agencies. To complete your credit score, they compare your information to other credit patterns that are present in thousands of past credit reports. Then, they use this information to come up with a credit score that accurately represents your level of credit risk. This number will let lenders make broad assumptions about how likely you will be to repay a loan or make timely credit payments. Of course, the higher your score, the more likely you’ll be to get approved.

And how do they determine a credit score?

By now you know that your credit score directly reflects your credit report, and you also know that it is calculated using “score factors”. Every aspect of a score factor can and will affect your score either positively or negatively. Below we have listed just a few factors that can have an impact on your score:

  • Too many credit inquiries
  • Notable credit delinquencies
  • Opening new lines of credit
  • Having an average balance of revolving credit that is too high
  • A clear shortage of mortgage accounts

But why do companies even want to use my credit score?

Companies want to use your credit score in multiple ways. In fact, your credit score is one of the most frequently used tools by finance companies, creditors, employers, and even insurance companies in the U.S. Companies routinely rely on credit scores for determining creditworthiness. Most companies consider credit scores to be accurate credit “snapshots” of that person’s creditworthiness. Companies use your credit score to help them make quick credit decisions about you. Creditors also can get your full credit report if they want to, which helps them review a larger amount of information about you.

TransUnion, Equifax, and Experian also offer industry-specific credit scores. These reports let lenders get a clearer understanding of more specific information, which they will often need when they are reviewing your credit. For example, car industry lenders use credit score models that review and evaluate the history of people’s car payments.

Industry-specific scores are based on available data present in the records of a specific agency, so it’s very possible that it will end up differing from one agency to the next. But credit score ratings can be different, depending on the score model being requested (such as renters, auto, mortgage, etc).

Can I ever see my own credit report?

Of course, and it is a good idea for everyone to check their credit report! One quick and easy way to see your own credit report is to visit www.annualcreditreport.com. You’ll be able to view your credit report from any of the 3 credit reporting agencies. By federal law, you’re entitled to view your report for free once a year.

But remember, this is not the same as credit monitoring. To have your credit monitored 24/7 across all three credit bureaus, sign up for GoldenCreditScores. This will not only allow you to view your own personal report whenever you choose, but it will also make it possible for your report to be monitored across all three bureaus. That way, if there’s ever any suspicious and/or irregular activity on your report, you’ll be contacted immediately.

How do credit reports get updated?

Credit reports are updated every month, but the day of the month that creditors submit this information will vary. Because of this, some agencies may receive updates from one creditor on the 11th of the month and from another on the 24th of the month. This is another good reason to check your credit report on a regular basis.

How does one define credit monitoring?

Credit monitoring is pretty easy to understand: It’s a service that continuously monitors a person’s credit for any unanticipated changes and updates. These changes could include new inquiries, missed payments, or even new accounts.

Of course, if you are a GoldenCreditScores member, then you’ll be contacted if any of the items mentioned above ever appear on your credit. This is how that credit monitoring can be an effective tool for people who are looking to fight against identity theft. With credit monitoring at your side, you’ll be updated as soon as anyone tries to open an account in your name. But if you do not have credit monitoring, then you may be at risk of someone stealing your identity and running up debt in your name.

What is the definition of a “credit inquiry”?

A credit inquiry happens when a financial company submits a request to obtain additional information that will help them understand your creditworthiness. These companies will use elements found in your credit report to help them make decisions about how much credit they should issue. Generally, some of the most common inquiries occur when people apply for home loans, auto loans, or new apartments. One good thing about these kinds of inquiries is that they cannot be made without your permission.

What sorts of benefits come with a GoldenCreditScores membership?

With your GoldenCreditScores membership, you’ll have unlimited access to your credit reports and scores. You’ll also receive a credit report consultation, 24-hour credit monitoring, email alerts, exclusive access to our credit education library, and much more!

How can I view my credit reports and scores?

Your credit reports and scores become available the moment you enroll. As soon as you sign up, you will be automatically forwarded to our GoldenCreditScores member dashboard. By using the tabs at the top of the dashboard page, you can easily navigate between your member benefits.

Where can I find my credit alerts?

On your member dashboard, click the “3-Credit Alerts” tab at the top of the page. Then click on the tab that is displaying the alert. It’s important that you take a look at these alerts as soon as possible.

If I receive a credit alert, what should I do next?

If you receive a credit alert, what you do next will depend on the type of alert. As an example, if you receive an alert that there has been a new inquiry made on your report, then you’ll need to consider a few things first. If you’ve recently applied for credit, then the alert could due to your application. But if you find that the inquiry was not due to any action you had taken, then you should call the company listed on the credit inquiry immediately. It’s important to stay up-to-date with these alerts and take the necessary steps to address them when needed.