Your Credit – It’s Important II

Why It’s Important

Good credit is necessary if you plan to use credit to make a major purchase, such as a car or a home, or want to be able to take advantage of the convenience credit can provide. The importance of good credit also extends beyond purchases, in that it may be used by potential employers and landlords as part of the selection process.  Experian (one of the three national credit reporting companies)

Most people understand that good credit is important but often they do not know how lenders determine their credit rating or how to protect their credit. This article is the second of two addressing these two important issues:

  1. First Article: How is your credit rating determined and how can you secure a good credit rating?

  2. This Article: How can you protect your credit and your identity from mistakes, fraudulent use and theft?

FTC Consumer Information Web Site:

This web site offers a number of articles with useful information for consumers, including important information about personal credit. We’ll reprint the highlights here, but we strongly encourage you to visit the site, by clicking here.

In our first article in this series of two, we discussed the importance of credit reports and scores, and how to obtain a copy of your credit report on a regular basis, (click here). But suppose you find a mistake or inaccuracy in your credit report. It happens! And it could have a significant negative effect on your credit!  What should you do?

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Your Credit – It’s Important I

Why It’s Important

Good credit is necessary if you plan to use credit to make a major purchase, such as a car or a home, or want to be able to take advantage of the convenience credit can provide. The importance of good credit also extends beyond purchases, in that it may be used by potential employers and landlords as part of the selection process.  Experian (one of the three national credit reporting companies)

Most people understand that good credit is important but often they do not know how lenders determine their credit rating or how to protect their credit. This article is the first of two addressing these two important issues:

  1. How is your credit rating determined and how can you secure a good credit rating? (this article)

  2. How can you protect your credit and your identity from mistakes, fraudulent use and theft? (click here to view)

How is Your Credit Rating Determined?

The Federal Trade Commission (FTC) offers a free 12 page document How Credit Scores Affect the Price of Credit and Insurance that explains the credit reporting and scoring process, and how you can maintain a good rating. That will give you a good understanding of credit reporting and the key factors that go into the process.

Here are some of the important points from the document:

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