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Free Credit Scores Online

Free credit scores online are comprised of a 3-digit rating number that lenders use to predict your credit risk level. This score is derived from your credit reports which are created by the 3 major credit bureaus. Scores can range from a low of 300 to a high of 850, with the average being 700. Legally, you have the right to see your credit report each year from all 3 bureaus at no cost. However, you will have to pay to see your credit score, which is considered proprietary information.

Lenders believe there is a direct correlation between your score and the chance of you defaulting on your credit responsibilities. So the higher your free credit scores online, the lower the risk of you defaulting. Therefore, high scores get the best loan terms while low scores get the worst.

Your free credit scores online are based on more than 80 factors and is computed from the contents of your credit report at a given point in time. Credit scores are never fixed but change with newly added information.

Some of the factors used to determine free credit scores online:

* Your payment history
* Number of credit inquiries
* Number of credit accounts you have
* Amount of credit used in comparison to your total credit limits
* Length of credit history
* Bills sent to collections agencies

* Any legal judgments against you or bankruptcies

It is equally important to know the reasons behind your particular score as it is to know the score itself. This knowledge allows you to manage your credit so you can get better loans at lower interest rates. If you want to get an idea of your total credit picture, get a free credit scores online at the same time you request your credit report.