How to Read Credit Scores

 
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How to Read Credit Scores

After being turned down for a loan by a big bank, customers might find that an online car title loan with a non-traditional lender is a great solution for their situation. At LoanMart, we strive to help people secure the money they need as quickly as possible.

We also care about the customers we serve, and we’re interested in promoting knowledge and responsibility when it comes to finances. That means we want to help borrowers understand money and credit.

It’s important to know why credit scores are relevant – and how to read it. Before shopping around for an online car title loan, it’s important to understand all there is to know about credit scores.

Understanding What Goes into A Credit Score

There are a few different factors that go into determining a credit score. These are:

  • Payment history
  • The age of credit history
  • What types of credit
  •  How much is owed on any of the lines of credit

Let’s look at each of these factors in a little bit more detail to properly read and understand credit scores:

Payment History

Payment history makes up a huge part of a person’s credit score, more so than any other one factor. “Payment history” refers to payments they have made – or haven’t made – in the past.

If all payments have been made on time and in full, this will improve an individual’s score. Late payments could hurt an individual’s score, especially if it’s happened recently.

Credit History

The age of an individual’s credit history also plays a part in determining their score. If an individual hasn’t had credit for very long, they won’t have the same track record of using credit appropriately when compared to someone with a longer credit history. The good news is, the longer an individual has credit, the better their score will get. That’s why it’s important for borrowers not to close their oldest account – it’s helping their score the most!

How Much is Owed

This one is pretty straightforward – if an individual owes money (in other words, if there is debt), an individual’s credit score is negatively affected. Borrowers should do their best to pay off balances and not utilize all the credit they have available if they want to improve their score here.

Types of Credit

This often makes up about 10% of an individual’s score, if the credit agency doesn’t have additional information about a person and their credit. This means that if they know about an individual’s credit and payment history along with how much that is owed, the type of credit they have doesn’t count for as much.

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DISCLOSURES

LoanMart may act as the broker for the loan and may not be the direct lender. Loan proceeds are intended primarily for personal, family and household purposes. LoanMart does not offer or service student loans. California loans are made or arranged pursuant to a California Financing Law License. See State Disclosures for additional disclosures.

1Credit approval is subject to LoanMart’s credit criteria standards. Actual loan amount, term, and Annual Percentage Rate of the loan that a consumer qualifies for may vary by applicant. Minimum loan amounts vary by state. Consumers need to demonstrate ability to repay the loan.

2Based on consumers who received a loan from February 2002 to October 2018.

3Application processes could take five (5) minutes to complete. Upon completion, a conditional approval may be given pending review of documentation. Funding time is based on the time from final approval following receipt and review of all required documents and signing, prior to 5PM PST on a business day.

4To exercise the right to rescind, the consumer(s) must notify LoanMart in writing by midnight on the sixth calendar day from obtaining the loan. Within one business day from notice of rescission, the consumer(s) must return any monies received and fees paid on behalf of the consumer(s) by certified funds.

5LoanMart recommends and encourages customers to pay early and often and more in order to avoid additional finance charges.

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