A credit score is a numerical representation, usually in the form of a three-digit number given to you by the credit bureau, which will show any potential lenders, the kind of credit risk you pose. Equifax is one of those three big companies of consumer credit reporting agencies that provides credit scores to the consumers in USA. The other two are Experian and TransUnion which have gained a lot of popularity in the recent past.
As for the scoring model, Equifax employs the Equifax Credit Score model, which is somewhere between 280 and 850. Overall, it is in your best interest to have a higher number concerning your Equifax credit score. A credit score of above 700 tells lenders that regardless of the amount of credit cards or loans you have, you will be able to repay them. However, one cannot state that such a score is a good or excellent Equifax credit score, as such definitions may also differ.
What is the good Equifax credit score It is considered to be good or decent if the respective Equifax credit score ranges between 680 and 739. However, according to information provided by Equifax, this range falls under the Good category. That is, your score is within this range indicating that your credit history shows that you are using credit and making payments responsibly. You might lower your interest rate to a certain extent but you certainly will not be eligible for the lowest interest available for people with a good credit rating.
This is how the Equifax Credit Score scale is divided
800-850 Extremely Strong 740-799 Very Strong 670-739 Strong 580-669 OK to Weak Below 580 Very Weak
Anyway, a score between 680-739 is Strong, which means it is enough, good enough to start with when you apply for a mortgage, auto loan, credit card, or other credit lines. Although, it is possible to get a car loan within this range but if you can move a few points up within this range then you become eligible for a better rate and better terms of the loan.
Equifax's credit score reflects how credit-worthy you are and several factors can affect this rating. The Equifax Credit Score is a three-digit figure that reflects your credit rating, and the following aspects define it:
The most important factors are:
- Payment History: Whether you delay or pay your bills and dues such as credit card payments, student loans, and mortgages among others. This factor is given the most weight contributing 35 percent of your total score.
- Outstanding Debt: This relates the credit balances you carry on your credit cards today against your total credit limits on all your credit cards. This percentage still forms 30% of the credit score calculation.
- Credit History Length: Credit utilization is a measure of how long you can borrow money to purchase goods and services. In general, a longer credit history is better for your score and if you would like to know more about credit scores then you can visit this link. This is equivalent to 15% of the total score.
- New Credit Applications: If you have applied for several new credit cards or loans recently, it will show higher risks to the credit card or loan provider and you may be negatively affected. New credit stays at 10% of your score in the FICO rating.
- Credit Mix: The type of credit also gives an indication, that it is better to have a balanced portfolio of credit cards, installment credits, mortgages, etc. Credit mix is considered to be equal to 10 percent of the overall amount.
Not applying for credit with frequency, paying all the bills on time, and ensuring that balances are low on credit cards are some of the best ways through which you can ensure that you have a decent Equifax credit score or enhance your credit score if it is low. It is also prudent to check your Equifax credit report frequently, so you can immediately notice any inaccuracies.
Equifax Credit Score: How Is It Possible to Check It Therefore, how can you check your latest Equifax credit score now? Equifax also makes it very convenient to see what your score is simply by going online for about 5-10 minutes.
The website annualcreditreport.com gives all consumers in the United States an opportunity to get one free Equifax credit report per year. This is the only legal website to get your free report as per the constitution. Apart from your detailed Equifax credit report, Experian credit report, and credit report from TransUnion, you will also receive your current Equifax FICO credit score.
If you wish to check your Equifax credit score any time you wish, then it is not a problem as the score can be bought online at Equifax. com. It is important to note that you can request your detailed Equifax credit report and your current credit score at any time of the year and not only once per year as is the case with the other two credit bureaus. The cost of reports is $19. 95 and scores are $9. 95.
Equifax also provides another service that goes for a monthly subscription called Equifax CompleteTM Premier. Available for a monthly fee of $24. 95, the Equifax membership offers the following features – Equifax credit score and daily monitoring of the score; Equifax credit report with monthly updates; alerts on any changes to the score or any suspicious activities; identity theft protection, insurance, and resolution services. The plan confines line your total credit history from the three credit bureaus of Equifax, Experian, and TransUnion once for monitoring.
Achieving a good credit score requires discipline, but the reward is in the ability to pay low interest when making big purchases and access to a wider range of credit instruments when the need arises. However, it is very important to keep an eye on this type of credit score to know what type of financial product is more suitable for you.
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