Credit Score Basics
This 3‑digit number, ranging from about 300–850, predicts how likely you are to repay borrowed money.
What is a credit score?
Being added to a parent’s credit card lets you build credit while using their account.
What is becoming an authorized user?
These three companies collect and maintain your credit information.
What are Experian, Equifax, and TransUnion?
Clue: Paying more than the minimum, cutting spending, and increasing income are all ways to do this.
What is paying off debt?
This person is the least likely to check your credit score.
What is a bank employee helping you open a savings account?
These two factors together make up the largest portion of your credit score calculation.
What are payment history and amounts owed?
This type of credit card requires a cash deposit that usually equals your credit limit.
What is a secured credit card?
Federal law allows consumers to receive a free copy of their credit report this many times per year from each credit bureau.
What is once per year?
When you have multiple debts, making at least this type of payment on all of them helps prevent serious damage to your credit.
What is the minimum payment?
A higher credit score usually means this benefit on loans.
What is a lower interest rate?
This action has the single greatest positive impact on improving a low credit score.
What is making on‑time payments?
Young people benefit from building credit early because they may need it for renting an apartment, financing a car, or doing this.
What is opening an unsecured credit card (or accessing future loans)?
This item would NOT appear on a credit report: job salary, loan payment history, or credit card activity.
What is salary of your current job?
When paying off multiple debts, this strategy involves making minimum payments on all debts while putting extra money toward the debt with the smallest balance first to stay motivated.
What is paying off the smallest balance first?
Using less than this percentage of your credit limit is best for your credit score.
What is 30%?
Applying for many of these in a short period of time can lower your credit score.
What is new credit (or hard inquiries)?
Lenders may hesitate to approve you for a loan if you have this type of credit behavior.
What is no credit history or very little credit history?
If something on your credit report looks wrong, the first step you should take is to do this rather than ignore it.
What is dispute or report the error?
Missing payments on federal student loans can lead to this government action.
What is wage or tax refund garnishment?
Compared to someone with a 730 credit score, a borrower with a 600 score will usually pay this on a car loan.
What is a higher monthly payment / more interest?
What are the for C's of Credit?
What is Character, Collateral, Conditions, Capital and Capacity?
A cosigner helps you qualify for a loan, but takes on this major risk if you miss payments.
What is responsibility for the loan and potential credit score damage?
Lenders use your credit report mainly to identify this pattern in your past behavior.
What is your payment history?
Making only minimum payments on credit cards often leads to this long‑term financial problem.
What is paying much more interest / a cycle of debt?
Payday loans are risky because they often have APRs close to this percentage.
What is 400%?