The credit score was originally developed by Fair Isaac Corp. as the "FICO" score. A credit score is a statistical method that assists in determining the borrower's ability to repay on a loan, product or service. The credit score combines pieces of data from the three major credit bureaus (Equifax, Experian and TransUnion).

Typically, a credit score is a 3-digit number that goes up to 850 and is based on several different factors including credit history and amount of outstanding debt. Usually, the higher the score, the more likely the borrower is to make payments on time.

Your credit score is important as it may be used to reject or accept credit applications you submit.

Many times, applicants with poor credit scores will be approved for credit but at a much higher rate than paid by applicants with high credit scores. Your credit score may also determine the interest rate you pay for auto financing and leasing, credit cards, mortgages, and insurance. It can even affect whether or not you are approved to rent an apartment or be hired for a job.

Information reported to your credit bureau may remain on your report for up to seven years or more.

Your credit score is usually based on:

• Timely payment of your bills
• The amount of your outstanding debt and your credit limits
• The length of your credit history
• The amount of credit you have recently applied for
• The number of, and the types of, credit accounts you have

You should:

• Get copies of your credit report and make sure the information is correct. A good score may entitle you to better interest rates on a loan. A bad credit score can mean high interest rates on loans. *See below for instructions on how you can get a copy of your credit bureau report
• Pay your bills on time. Late payments may be reported to your credit bureau and may impact your score.
• Avoid overextending your credit. Be aware that unsolicited credit cards may be tempting to accept and use, but they may negatively impact your credit score
• Never ignore overdue bills. If you encounter problems paying money you owe, call your creditor to make arrangements. If you explain you are having difficulty, they may be able to work out an arrangement with you
• Keep your outstanding debt low. Continually extending credit close to your credit limit can be viewed negatively
• Try not to submit an excessive amount of credit applications
• Show a longer time frame of good credit over a shorter period of credit, as credit is built over a period of time

The three major reporting agencies are:

1. Equifax
2. Experian
3. TransUnion

You can order a free credit report at www.annualcreditreport.com, or call 877-322-8228. An authorized online source for a free credit report is: Annual Credit Report Request Service, PO Box 105281, Atlanta GA 30348-5281

You can purchase a credit score by contacting one of the nationwide consumer credit reporting companies:

• Equifax - www.equifax.com - 800-685-1111
• Experian - www.experian.com - 888-397-3742
• TransUnion - www.transunion.com - 800-916-8800

Under the Fair Credit Reporting Act (FCRA), and in accordance with the Fair and Accurate Credit Transactions Act (FACT Act), each of the nationwide consumer credit reporting companies must provide you with a free copy of your credit report, at your request, once every 12 months