There are several companies that gather this information, which they use to calculate a score that evaluates whether you are likely to repay your debts. If you have a lower score, you are considered a bigger risk for loans, which means you will have to pay higher rates on car loans, mortgages and credit cards. Scores generally range from 300 to 990. If your score falls below 700, work on improving it. See the Resources section for details on the main providers of information in this area.
- Check your credit score at least once a year. You can order your score from any of the legitimate services, for a modest fee. The main providers are Equifax, Experian, TransUnion, or FICO (Fair Isaac Corporation).
- Check your credit report at least once a year. Credit reports may contain errors that negatively affect you. If you see anything inaccurate in your credit report, write to the company to request a correction. A new federal law now guarantees all Americans a free credit report once a year. Also, you can request a free credit report from any of the three providers if you have been denied a job, insurance, or credit, or if you have been a victim of identity theft. See the Resources section for information about obtaining free reports from legitimate providers.
- Beware of scams. Look out for companies offering "free credit reports" that are not really free services or that could be scams. Don't give personal information to unfamiliar companies that contact you. Don't enter into purchase agreements with companies offering to finance expensive products, where the cost can depend on your credit score.
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