Definition of «credit score»

A credit score is a numerical value that represents an individual's creditworthiness. It is calculated based on various factors such as payment history, outstanding debt, length of credit history, types of credit, and recent credit inquiries. Lenders use this score to determine the likelihood of a borrower repaying their loans on time, which helps them make informed decisions about extending credit or setting interest rates. A higher credit score indicates better creditworthiness and can result in more favorable loan terms.

Sentences with «credit score»

  • A change in credit score of as little as 50 points can make a big difference in the interest rate that you are paying. (financialwellness.org)
  • The national average mortgage interest rate for borrowers with good credit scores on a 30 - year fixed - rate loan in 2017 has been 4 %. (valuepenguin.com)
  • They have a nominal impact on credit scores for a short period. (growingfamilybenefits.com)
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