Four Things You Should Know about Credit Scores
When you start thinking about auto financing, you should know what your credit score is before you start shopping around. The more you know about credit scores and your particular score, the better decision you can make regarding how much you can afford and your interest rates. Here are some quick facts about credit scores.
• Before a bank or financial institution gives you credit, they will review your credit score and history. This will be the main basis for the amount of interest they are going to charge.
• The higher your credit score, the lower your interest rates are going to be when financing a new or used car. A higher score may also mean lower premiums with some insurance companies.
• The three main credit-reporting agencies are Equifax, TransUnion and Experian. You can check your own credit score with these companies before you dive into auto financing.
• Your credit score is based on several common factors – payment history, amount of debt owed, types of debt and others. Different companies consider different factors, but these three are the most common.
These are just a few facts that may help you understand your credit score better when it comes to financing your next car. Use these facts to help you make a more informed decision about which car to purchase.
