I'm 24 and have never had a credit card. I think I will probably get one when I return to school next year. However, I'm wondering what my credit score is. I have lived on my own and paid my own bills. I have several savings accounts/CDs. I have had the same job for some time now. Does any of this go into determining my credit or is it just credit cards? I apologize if this is a stupid question. =)
2006-12-10 11:45:47 · 8 answers · asked by starfishblues 4 in Business & Finance ➔ Credit
Oh, I haven't checked it yet or anything. I know that doing that would be unnecessary. I'm just curious.
2006-12-10 11:51:06 · update #1
Credit scores only reflect your ability to get into and maintain debt. You could have $1 million and a zero fico score. Don't fall for the common misconception that says you HAVE to have a credit card. You can still get a job, insurance and a mortgage without a score. You've been smart up to this point, just continue on same path and you'll be fine.
debtfighters.blogspot.com
2006-12-10 13:27:11 · answer #1 · answered by Anonymous · 0⤊ 0⤋
$$Cypher had good answers. Beyond that I would say that unfortunately what you've been doing now likely has no effect on your credit score. You need to have accounts that report to credit agencies, and typically these are accounts that extend credit. (Sometimes utilities report to credit agencies, such as Verizon in my area.) Unless you've opened a line of credit of some sort, therefore, you will likely have zero credit history.
When you get your credit card, use it conservatively. Use it to buy only those things you would have bought otherwise, then pay it off each month. Use it as a method of payment, not as a source of money. If you borrow (carry a balance), only do so after you've gained at least several months' experience with the credit card, and then only if you are in a bind. At some point you will need to actually borrow and repay funds over time to establish good credit with a higher credit score.
2006-12-10 12:52:59 · answer #2 · answered by ? 4 · 0⤊ 0⤋
But first, just what is a credit score? To calculate a score, Fair Isaac uses 22 pieces of data collected from the three major credit bureaus, Equifax, Experian and TransUnion). The lowest possible score is 300, while the highest is 850.
The final number is a composite of individual ratings in five categories:
Payment history (35% of the rating)
Length of credit history (15%)
New credit (10%)
Types of credit used (10%)
Debt (30%)
So how long on your job, number of bank accounts, and good rental history have no effect on your credit score.
For more information get your credit reports or free from www.annualcreditreport.com & do get reports from all three major credit reporting agencies.
2006-12-10 11:57:51 · answer #3 · answered by $$Cypher 2 · 1⤊ 0⤋
There are a number of things that create/affect your credit score.
Debt-to-income ratio-- how much you owe compared to what your anual income is....
Account (loans, bills, etc) status-- How are you doing on your bills- are you current? have you been staying current? Are you 30+ days behind on anything?
Have you taken out any loans that have a judgement on them or that have been foreclosed? A car loan that has gone into default and the car has been reposessed?.....
A low debt-to-income ratio is good, keeping current on your bills is good, judgememts, default and repo's are bad....
Best of luck, and be VERY VERY careful about how and when you use your new credit card. Don't borrow any more than you can pay off right away... Remember- debt is a four-letter word for a reason and should be avoided whenever possible. Interest can be a pretty mean taskmaster!!
2006-12-10 11:59:30 · answer #4 · answered by Yoda's Duck 6 · 0⤊ 0⤋
Put it like this, no credit is worse than bad credit, coz they do not you and are new in the system!
Big problems getting credit, my hubby worked abroad and had great difficulty getting credit coz he never had it in this country!
2006-12-10 11:51:42 · answer #5 · answered by Welshchick 7 · 0⤊ 0⤋
checking your credit for phones and houses makes you look like a spender. Dont check your credit in things like that unless you are a serious byer
2006-12-10 11:48:59 · answer #6 · answered by karenmariawayne 4 · 0⤊ 0⤋
This excellent article will tell you everything you need to know :
http://financialbasics.blogspot.com/2006/11/credit-reports-and-credit-reporting.html
Have a good one
2006-12-10 23:26:24 · answer #7 · answered by Anonymous · 0⤊ 0⤋
How much you earn, how much you borrow, and how consistent you are in paying it off on time.
2006-12-10 11:50:48 · answer #8 · answered by Jesse2k 2 · 0⤊ 0⤋