Credit Score

A credit score is a numerical representation of an individual’s creditworthiness, calculated based on their credit history, including factors like payment behavior, credit utilization, and length of credit history. Credit scores range from 300 to 850, with higher scores indicating lower credit risk. Lenders use credit scores to assess the likelihood of a borrower repaying a loan, and a higher score typically results in better loan terms and interest rates.

Example

A person with a credit score of 780 is considered to have excellent credit, making them more likely to receive favorable loan offers with low interest rates.