How Do Credit Scores Work?

Posted: Friday, March 11th, 2016

When it comes to securing a home, purchasing a vehicle, or acquiring a loan for tuition fees, few factors are more important than your credit score in determining your eligibility for a loan. Your three-digit credit score factors in all of your spending and loan habits, as well as the frequency and likelihood of you paying off your debts. To help clarify what is involved in a credit score, Green Light Auto Credit has drawn up a guide for your use.

How is Your Credit Score Calculated?

A credit report is an accumulated record of how you pay your bills and repay your loans, how much favorable credit you have attached to you, and what your preexisting debts look like. These are all factors that potential lenders consider when deciding whether you will be a reliable borrower in paying back your loans. Credit reports do not contain your credit score, but rather provide the raw data that credit bureaus and agents use to calculate it. Many data companies have different methods of calculating credit scores, though major companies like the FICO corporation and VantageScore operate within a credit score range between 301 and 800. If you fall between a 700 and 850 score, you’re considered a prime candidate for a loan. If you are below a 600, you are considered a higher risk and will either have more trouble securing a loan or have to pay higher interest rates.

How Does a Low Score Affect You?

A low credit score can saddle you with greater difficulty in securing loans for major life-centric purchases such as homes, vehicles, or even college loans to help settle tuition debt. You’ll have to pay exorbitant interest fees in order to cushion any doubts regarding your ability to pay back what you owe your lenders, making you jump through additional hoops just to stabilize your credit score.

Why Choose Green Light Auto Credit?

At Green Light Auto Credit, we offer comprehensive loans with reasonable interest rates to borrowers with less-than-ideal credit histories. We have access to a wide inventory of cars spanning multiple dealers and can get you the best deal in town, all while helping you to find financing geared towards rebuilding your score. Just fill out one of our financial applications and you’ll be the on the fast track to securing an affordable loan!
Bad Credit / No Credit Financing Guide Answers to your Credit Score Questions

Trust Green Light Auto Credit for an Affordable Loan Regardless of Credit Score

If you’re looking for an affordable loan but your credit score is less than ideal, don’t worry: Green Light Auto Credit is here to help. Anyone is welcome to apply, regardless of past credit scores. Feel free to contact us online or by phone at 866-845-1603 today.