What is a credit score?
A credit score measures your ability to manage debt, reflecting your reputation as a borrower. The FICO score, a common credit score, helps lenders assess your loan repayment likelihood.
Why Good Credit Matters
- Lower interest rates
- Saving money on insurance (car and homeowners)
- Reduced or no security deposits on utilities and cell phone service
Improving Your Credit Score
- Check Your Credit Report: Obtain a free annual credit report from Experian, Equifax, and TransUnion to spot errors and understand what impacts your score.
- Use Bank Resources: Many banks and credit unions offer personalized tips to improve your credit score.
- Target Problem Areas: Focus on the specific factors lowering your score.
Students should monitor their credit reports and scores. Credit scores play a major role in interest rates offered for loans, including private student loans. Improving your credit can expand your borrowing options and help you qualify for better, more affordable terms.
