IN THIS LESSON

In-Depth Explanation

A credit score is a three-digit number that represents your creditworthiness, or how likely you are to repay debt. It's used by lenders, landlords, and sometimes employers to evaluate how financially responsible you are.

What Affects Your Credit Score?

  1. Payment History (35%) – Do you pay your bills on time?

  2. Amounts Owed (30%) – How much debt are you carrying relative to your credit limits?

  3. Length of Credit History (15%) – How long have you had credit accounts?

  4. Credit Mix (10%) – Do you have a mix of credit types (credit cards, loans)?

  5. New Credit (10%) – Have you applied for a lot of new credit recently?

    A higher score helps you qualify for loans, credit cards, lower interest rates, rental applications, and sometimes even job opportunities.

    A lower score might lead to higher rates, denied credit, or needing a cosigner.





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