How Do Credit Scores Work?

Credit scores range from about 350 to 800. Lenders generally give the best terms to customers over 720 or 740. The number and type of accounts affect your score. If you are nearing the credit limit on your accounts your scores will be lower. Some accounts are better than others. For example an American Express account may be better from a credit scoring standpoint than an American General account. Length of time is also an important factor. Older established accounts have a more positive impact than newer accounts. Having an old Sears card from 1997 with a $2000 credit limit shows more history than a Capitol One card that was opened 6 months ago with a $500 limit. One way to improve your credit scores is to pay down your balance. Having the lender raise the credit limit can help as well. To receive a free copy of your credit report contact us at pc@glmcdirect.com.