The range of credit scores in the United States is 300 to 850.
Credit scores are calculated by credit bureaus like Experian, Equifax, and TransUnion based on your credit history. A higher credit score generally indicates a lower risk to lenders, which can lead to better interest rates and loan terms.
Here are some examples of how credit scores can affect your financial life:
- Loan Approval: A good credit score can increase your chances of getting approved for a loan, such as a mortgage or auto loan.
- Interest Rates: A higher credit score can qualify you for lower interest rates on loans, saving you money over the life of the loan.
- Credit Card Offers: You may be eligible for better credit card offers with a good credit score, including lower annual fees and higher credit limits.
Maintaining a good credit score is important for your financial well-being. You can improve your credit score by:
- Paying your bills on time.
- Keeping your credit utilization low.
- Avoiding opening too many new credit accounts.
- Monitoring your credit report for errors.
