We hear a lot about credit these days. Credit scores, credit reports, credit reporting agencies, credit utilization ratios. But why does credit matter? Your credit score can have an impact on your ability to achieve your most important goals. From buying a home or vehicle to renting an apartment, purchasing insurance, or even applying for a job, your credit score will be one of the most important factors in determining whether you are in the driver’s seat or back seat on the road to your financial future.
Data from FICO®, a data analytics company focused on credit scoring services, reports that the lower your credit score, the more you will pay for credit. For example, as of March 19, 2024, the national average mortgage interest rate for a 620-639 credit score, considered the lowest qualifying score for a mortgage, was 8.267%; while the average for a 760-850 credit score, considered the highest qualifying score for a mortgage, was 6.678%. What is the bottom line to these numbers? Individuals with lower credit scores pay more and often have to settle for less.
According to Experian, one of three nationwide consumer credit reporting companies, in 2023 the average FICO® Score☉ in the United States was 715, while the average Florida score fell slightly lower at 708. While having knowledge of your score is important, gaining an understanding of how your score is calculated is critical to maintaining good credit.
The internet offers countless resources to assist you regarding all topics related to credit, but misinformation on credit can often lead consumers astray. One trusted resource to help you gain access to your credit report is the website www.annualcreditreport.com, which is jointly operated by the three major nationwide credit reporting companies, Equifax, Experian, and TransUnion. The site is authorized by federal law and provides consumers access to a free copy of their credit report every 12 months, from each of the three credit reporting companies.
For additional guidance on navigating your credit report and to learn how credit scores are calculated, join EdFed and Experian for an educational and informative webinar on Saturday, April 27th from 11:00 a.m. to 12:00 p.m. Registration for this free webinar is available at www.edfed.org/webinar.
About EdFed
Established in 1935 by school employees in Miami, EdFed is a not-for-profit financial institution that serves over 100,000 members with a full range of lending and deposit solutions. With over $1.6 billion in assets, EdFed is the largest credit union headquartered in Miami-Dade County and operates seven branch locations across the area.
Community News Releases
Source link
