A three-digit number representing your creditworthiness based on your credit history.
A credit score is a three-digit number (typically 300–850) that represents your creditworthiness—how likely you are to repay borrowed money. The most widely used credit score is the FICO score, calculated using five factors: payment history (35%), amounts owed (30%), length of credit history (15%), new credit (10%), and credit mix (10%). Higher scores (above 750) qualify you for better interest rates and loan terms; lower scores (below 580) make borrowing more expensive or difficult. Credit scores determine the interest rates on mortgages, auto loans, credit cards, and personal loans. You can check your credit score for free annually at annualcreditreport.com. Improving your credit score takes time but is worth the effort—a 100-point improvement can save you thousands in interest over a lifetime of borrowing.