What Is a Credit Score?

A credit score is a three-digit number used by lenders to estimate how likely you are to repay borrowed money on time.

Credit Score Overview

Credit scores are calculated based on your credit history, including payment history, amounts owed, length of credit history, types of credit, and new credit. Lenders, landlords, and even employers use credit scores to assess financial reliability. A higher score can lead to better loan terms, lower interest rates, and increased access to credit. Understanding and managing your score is essential for achieving long-term financial goals like buying a home or getting approved for credit cards.

Key Points

• A credit score is a number that reflects your creditworthiness.
• Scores typically range from 300 to 850.
• Higher scores mean lower credit risk to lenders.