Are you considering making a major purchase, like buying a home, this year? If so, your credit score will likely come into play. An understanding of the basics can help you effectively monitor and manage it.
Lenders use this three-digit number to predict risk and the likelihood that you’ll repay your debt on time. The higher your credit score, the less risk you are and the lower your loan terms will be. For example, a person with a “good” credit score of 700 may have a lower interest rate and smaller required down payment than someone with a “poor” credit score of 400.