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Your credit score, why it counts.

An individual's credit score is a snapshot of their credit file at a specific point in time. Why is it important? Because it is a significant factor used to determine the rate a consumer pays on a mortgage, an automobile loan, credit cards as well as home and automobile insurance.

Creditors report account information to the following major credit reporting agencies (CRAs): Equifax, Experian and TransUnion. In turn, the CRAs compile the information for all reported accounts in to an individual credit report and determine the credit score for the consumer. A credit score can range from 300 to 850, the higher the score the better. Credit scores take into consideration the following factors--existing payment history, amount owed, length of credit history, types of credit used and inquiries. Remember the credit score will vary based on changes in these factors.

There are several steps you can take to potentially improve your credit score. First, make your payments on time. Use a revolving account every six months to keep the account active and paying down credit cards to below 30 percent of the high credit limit is ideal. Closing accounts will not improve your score. Being aware of your credit history is a key to maintaining good credit scores. You are entitled to one free credit report from each of the CRAs once a year. To gain access to your annual free credit report please contact us for details.

This is a great time to purchase a new home or refinance your existing mortgage as interest rates are historically low. Checking your credit first is a great place to start!

For additional information, please contact us at (888) 213-4602, or visit us at www.onelenderforlife. com.

By Jim Williams

President, Southern Highlands Mortgage LLC

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Title Annotation:Finance Matters
Author:Williams, Jim
Publication:Georgia Nursing
Date:Nov 1, 2009
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