What is a credit score?

A credit score is a three-digit number used by lenders to evaluate a person’s credit standing. The score is calculated using information from a person’s credit report, which shows the borrower’s payment history, outstanding debt, types of accounts, and other factors. The higher the credit score, the better the creditworthiness. In the state of Tennessee, the average credit score is 679, which is slightly below the national average of 687. Credit scores are used by lenders to determine whether to offer you a loan or not. Having a good credit score is important if you’re looking to apply for a loan, credit card, or any other type of borrowed money. Lenders use the credit score to assess the risk of a borrower defaulting on the loan. If your credit score is in the lower range, banks are likely to deny a loan application or offer a higher interest rate. Developing and maintaining a good credit score is an important part of your financial health. Paying bills on time, keeping balances low on credit cards, and avoiding large purchases could all help to improve your credit score. Credit laws in Tennessee require lenders to provide consumers with documents outlining accurate credit information and the process for dispute resolution. Additionally, all consumers in Tennessee have the right to obtain a free credit score annually from each of the three major credit bureaus.

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