What is my credit score?

The credit score (or rating) is a figure used to predict the likelihood of you paying a loan, or paying your debts on time. To generate a rating, credit institutions apply a mathematical formula called “rating model” to the information contained in a consumer’s credit report. The most famous rating model is that of the Fair Isaacs Company that produces the FICO score.


Generally, a high credit score makes it easier to get a loan and receive a lower interest rate

get a loan

There is not just one credit score. In fact, creditors use and have access to a variety of ratings created by rating companies according to different credit reports that are targeted at different industries. The credit score purchased by a creditor can be based on a generic model, an industry model or a credit rating model tailored to the creditor. There are several companies that generate credit rating models, such as FICO and VantageScore Solutions, LLC. There are also ratings created specifically to sell to consumers. When a consumer buys a rating from a credit bureau, the rating is not necessarily based on the same formula a credit institution would receive when considering granting a loan.


Tip: There are no shortcuts to get a good credit rating

Tip: There are no shortcuts to get a good credit rating

According to the companies that create the rating models, the best ways to obtain and maintain a good rating are the following:

  • Pay bills on time
  • If you haven’t made some payments, get up to date and stay that way
  • Keep balances low on credit cards and other “renewable” credits
  • Keep the oldest credit card accounts open and keep checking if you don’t use them regularly
  • If you have a credit for a short time, do not open many accounts too quickly
  • When comparing loans or mortgages, do so for a reasonably short period of time
  • Apply only for the credit you need, since having many accounts can lower your rating
  • Make sure the information in your credit reports is correct.