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Step 1 Action 2:
Get Your Credit Scores


What Are Credit Scores And Why Do I Need One?

If you did Step 1- Assessing how much debt you really have you now know exactly where you stand. You know what your assets are, what your debts are and the amount you must pay for monthly bills and expenses.

The next step in the process of controlling your credit card debt is to find out your credit score. Credit scores and credit reports are two terms you will hear often during this journey out of debt.

Let's start at the beginning.

It is important to know your credit score to know where you stand in the financial world and to be able to track your progress from debt heavy to financial freedom.

Lenders need a way of predicting who will most likely pay their bills and who won't. They use the information in your credit reports, credit applications and credit history to determine the level of risk associated with giving you credit - whether that is in the form of a credit card, loan or a mortgage. Credit scores are the numbers that they assign based on that information.

As well as using the information to determine whether or not to extend credit to you in the form of a new credit card or loan, lenders also use the information to decide what interest rate to charge you and whether or not to raise your credit limit.

Insurance companies use the information in your credit report as well, to decide if they will give you auto or home insurance, whether they will renew your existing insurance, and what rates they will charge you.

Even employers can use this information, in the form of consumer scores, which are calculated a bit differently than credit scores. Some companies use consumer scores to help them decide whether or not to hire you.

So you can see that it is very important for you to know what your credit score is and what is contained in your credit report.

Learn more about credit scores here  





FYI ...

To achieve financial freedom, ideas such as: listening to good advice, learning how to make a budget, understanding credit repair possibilities, avoiding the scams, and generally becoming more knowledgeable of the credit card business, can all play a role in eliminating credit card and other debt. There is A smarter way to manage your money.











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