Credit scores simply explained

Let's start with the basics

Your credit score affects everything from your credit card limits to renting an apartment to the rates you receive on mortgages and other loans.

The higher your score, the more creditworthy you are to lenders. If your score is low, lenders will perceive you as a riskier borrower and therefore charge you higher interest rates.

How Your Score Is Calculated

Your credit score will vary depending on which of the three credit bureaus – Equifax, Experian and TransUnion – is used. To simplify this confusion, the three main credit bureaus partnered together to create the VantageScore. LendingTree provides you with the most recent version of this credit score: VantageScore 3.0.

Glossary Terms

Credit Score
A credit score is a number generated by a statistical system used to rate the credit of an applicants according to various characteristics relating to... <a href='/glossary/what-is-credit-score' title='See the full definition of Credit Score'>read more</a>
Credit Report
A credit report is a report of an individual's credit history that a credit reporting company or credit repository prepares to determine a borrower's... <a href='/glossary/what-is-credit-report' title='See the full definition of Credit Report'>read more</a>
Credit History
The record of how you've borrowed and repaid debts. <a href='/glossary/what-is-credit-history' title='See the full definition of Credit History'>read more</a>
Credit Bureau
An agency that keeps your credit record. <a href='/glossary/what-is-credit-bureau' title='See the full definition of Credit Bureau'>read more</a>
Credit Reporting Company
Company that collects information received from more than one credit repository, merges all the information, and reports it in one form; merged credit... <a href='/glossary/what-is-credit-reporting-company' title='See the full definition of Credit Reporting Company'>read more</a>
Equal Credit Opportunity Act
A federal law that requires lenders and other creditors to make credit equally available without discrimination based on race, color, religion,... <a href='/glossary/what-is-equal-credit-opportunity-act' title='See the full definition of Equal Credit Opportunity Act'>read more</a>
Revolving Debt
Open-ended accounts, usually with variable interest rates, pre-determined credit limits and payments that are calculated as a percentage of the unpaid... <a href='/glossary/what-is-revolving-debt' title='See the full definition of Revolving Debt'>read more</a>

Why Check Your credit score?

Savings Alert

We found lenders that can save you up to $503/mo.

There are many reasons to check your credit score. First, it's good to know where you stand since the interest rate you receive on loans – including mortgages, auto loans, personal loans and more – is dependent on your score. And second, keeping an eye on your credit score can help alert you of any errors or fraudulent activity in your name. If you notice a sudden drop in your score, for example, you can pull your full credit report at Annual Credit Report and review it in detail.

Get My Free Credit Score

With LendingTree, You Get...

At LendingTree, we want to help you monitor and improve your credit. Each month, we'll give you your credit score for free in addition to evaluating your credit score and current debt to see if there is any room for savings. If we find savings, we'll send you an alert via email.

Ways to improve your score

Get Your Score for Free

Credit Score Resources

Credit Repair Services

When looking into services to repair and improve your credit, it's important to research as much as possible. You want to make sure you identify and avoid any scams and protect yourself. You can learn more at What You Need to Know About Credit Repair Services.

How to Build Credit

Perhaps you're just starting out on your own and need to build your credit. Luckily, you can start establishing credit by starting small – such as opening up a student credit card or putting some bills in your own name. Make sure to pay every single bill on time and get in the habit of monitoring your credit score regularly. You can learn more on how to build credit here.

Improve your credit

You can improve your credit by paying all of your bills on time, using your credit card wisely, disputing any errors on your credit report, and keeping your credit card balances low. For more, see 5 Simple Ways to Improve Your Credit Rating.