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Credit Essentials: Understanding your credit score

Let’s break down what makes up your credit score.


Credit Essentials: Understanding your credit score
Maraming factors ang nakakaapekto sa credit score mo, including on-time payments and credit utilization.

When it comes to personal finance, your credit score takes center stage. It’s not just a number — it’s your financial report card, influencing everything from your chances to make a big purchase (e.g. a house or a car) to low-interest loans.


Your credit score, typically ranging from 300 to 850, is a numerical reflection of your creditworthiness. It's a dynamic number that evolves with your financial choices.


The higher the score, the more financially trustworthy you appear to lenders. Now, you might wonder, what factors determine this magical number?


Payment History. Your payment history is like the backbone of your credit score. Consistent, on-time payments are the golden ticket to a healthy score. Missed payments, on the other hand, can be a major downer.


Credit Essentials: Understanding your credit score

Credit Utilization. This means the amount of credit you’re using compared to your total available credit. Aim to keep this ratio low — it’s a balancing act that demonstrates responsible credit management.


Credit History. The longer you’ve been in the credit game, the better. It shows you have a proven track record of handling credit responsibly.


Credit Essentials: Understanding your credit score

Credit Mix. Whether you have a diverse portfolio, including credit cards, loans, and maybe even a mortgage, you’re painting a picture of a responsible borrower.


Credit Inquiries. Too many, too quickly, can be a red flag. Each inquiry slightly dings your score, so be mindful of when and why you’re applying for credit.


Credit Essentials: Understanding your credit score

Your credit score is not set in stone. Understanding these elements empowers you to take charge of your credit journey. So regularly check your credit report for errors, pay your bills on time, and strive for a diverse credit mix.


Whether you’ve recently gotten your credit score or looking to boost your existing score, remember, knowledge is power.


Enjoy the credit journey, understand your score, and set the stage for a financially empowered future.


Start today by checking your credit score for P199 on Lista! Download the app for FREE on the App Store and Play Store.

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