What is Credit Scoring?
Credit scoring is a system lenders use to help determine whether to give you credit. Information is collected from your credit report and your credit application to calculate your credit score.
A statistical program compares your credit information to those of hundreds of thousands with similar profiles. Based on this comparison, a score is generated which identifies the level of future credit risk you present to a lender.
In order to calculate a credit score, your report must contain at least one account which has been opened for six months or greater. In addition, the report must contain at least one account that has been updated in the past six months. This ensures that there is enough current information on which to base a score.
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