Credit Scores

Yeah, it might sound like something your mom would say, but as you head out into the world, it will be more important than ever when it comes to your credit report. Basically the short of credit reporting is:

There are three companies - big companies - that keep credit records on everybody. Every time you apply for a loan, credit card, make or miss a payment to a reporting vendor, something gets marked down in your file. So much info is stored about you over time, it's almost scary.

But as you apply for new things like a phone for your new apartment, a car loan, or a store credit card to buy that new software, companies will check your record. They want to know if you are a good risk or a bad risk for them. What you don't want to do is hurt yourself by getting negative things on your report.

On the web, apply only if you mean it.

The net makes it easy to apply for credit. What you might not know is that each and every time you apply, the creditor pulls out your report for a quick look. Every time this happens, your credit score goes down a few points.

Your credit score is a number that banks and stores look at to see what kind of a risk you are. It makes it easy for them to decide if you are in or out. So if you are online applying "just for fun", you may be lowering your score and hurting yourself when it comes time to apply for real.

Lots of places report to credit bureaus. Lots.

Remember that many different kinds of businesses may report to credit bureaus. You might figure your phone company and landlord do, but how about your cell phone company? Or that little store in the mall that carries the lava lamps and tiki candles that you like so much?

As you get more into using credit, be aware that while not everyone reports, many businesses do. And a little slip up here or there with your bills may not seem like much, but it could cost you big in the end.

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