Credit Scores - Michigan State University Federal Credit Union

WHAT IS A CREDIT SCORE?

At MSUFCU, we strive to provide you with a wide range

of outstanding financial products and services aimed at

helping you reach your financial dreams. An important

part of attaining many of your financial goals, such as

buying a new home, car, or even finding a new job, is a

positive credit score.

KNOW THE SCORE

Your credit score is a three-digit number that

ranges from 300 to 850. Lenders typically

use this score to determine the likelihood

that you will be able to pay them back.

800+

Exceptional

Dependable

799-740

Good

669-580

739-670

Below Average

579

or less

Risky

The most commonly used credit score is

generated by three major credit bureaus

(Experian, TransUnion, and Equifax), and is

based on information in your credit report.

HOW IS YOUR CREDIT SCORE DETERMINED?

30%

15%

What makes up your

credit score?

35%

payment history

1

10%

10%

amounts owed

?

?

?

?

?

length of

credit history

IMPORTANT TO KNOW

One late payment can lower your score by

as much as 100 points.

You can challenge inaccurate information

on your report.

The total credit you have is less important than

your total available credit.

Debit cards will not repair or establish credit.

You may get a free copy of your credit report

each year.1

number of types

of credit

Free credit reports are available annually at . To receive your credit score, a fee may apply.

new credit

WHAT AFFECTS YOUR CREDIT SCORE

35%

Past History

30%

Amount Owed

15%

Length of

Credit History

10%

Types of

Credit in Use

10%

New Credit

Factors That Hurt Your Score

Ways to Improve Your Score

Late Payments. It takes about 24 months

to restore damaged credit from just one

late payment.

Pay on Time. Late payments are the most

common piece of negative information

on reports.

No Availability. Cards with balances at their

maximum credit limits lower your score.

Pay Down Debts. Bring delinquent loans

current.

Closing Revolving Accounts. This reduces the

history of your accounts and lowers available

credit limits.

Don¡¯t Close Accounts. Pay down or pay off

credit cards, but don¡¯t close them. A closed

account will still show up on your credit report.

Too Many Revolving Accounts. Revolving

credit (credit cards) reflects more negatively

than installment loans (auto loan, mortgage).

Revolving Credit. Move revolving debt (line-ofcredit accounts) to installment debt (closed-end

loan accounts).

Opening Multiple Cards. Multiple new

accounts opened in a short period of time

reflects negatively on your credit score.

Avoid Multiple Cards. Don¡¯t open multiple new

lines of credit in a short period of time.

HOW CREDIT INQUIRIES IMPACT YOUR SCORE

SOFT HITS

HARD HITS

¡°Hard¡± hits to your credit

report may affect your score.

Examples of soft hits:

? Inquiries by you: You can purchase

your credit score without penalty.

? Inquiries by insurance companies

Examples of hard hits:

? Inquiries by lenders: This can occur

any time you apply for a credit

account or loan.

? Inquiries by retail stores

Resources

¡°Soft¡± hits to your credit report

do not affect your score.

Request Your Credit Report:



Financial Calculators:

calculators

Credit Report Information:

creditreports

GreenPath Financial Solutions:

greenpath

Financial Seminars:

seminars

BudgetSmart Software:

budgetsmart

We¡¯re here to help!

If you¡¯re looking to rebuild your

credit, try our Credit Rebuild Visa!

This card is designed to help get

your credit score back on track.

Questions? Contact us!



517-333-2424 ? 800-678-4968

120

08/17

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