What is my credit score — and why does it matter?

Information on how you’ve handled debt in the past is translated into a three-digit score predicting how likely you are to repay a future loan or credit card balance. The higher your score, the better you look to potential creditors.

With a low score, you may still be able to get credit, but it will come with higher interest rates or with conditions, such as depositing money to get a secured credit card. You also may have to pay more for car insurance or put down deposits on utilities. Landlords might use your score to decide whether they want you as a tenant.

But as you add points to your score, you'll gain access to more credit products — and pay less to use them. Borrowers with scores above 750 or so have many options, including the ability to qualify for 0% financing on cars and credit cards with 0% introductory interest rates.

Is my credit score really free?

Yes! You can sign in to NerdWallet at any time to see your free credit score, your free credit report information and more.

What is a good credit score?

The most commonly used credit scoring models range from 300 to 850. Each lender sets its own standards for what constitutes a good credit score. But, in general, scores fall along the following lines:

• 720 and higher: excellent credit
• 690-719: good credit
• 630-689: fair credit
• 629 or lower: bad credit

How can I build my credit score?

The two biggest factors in your score are payment history and credit utilization (how much of your available credit you're using). That’s why they come first in this list of tips:

• Pay all your bills, not just credit cards, on time. Late payments, a debt collection or a legal judgment against you will hurt your score.
• Use no more than 30% of your credit limit on any card — and even less, if possible. The best scores go to people using 10% or less of their credit limit.
• Keep accounts open and active when possible — that gives you a longer payment history and can help your credit utilization.
• Avoid opening too many new accounts at once; new accounts lower your average account age and each application causes a small ding to your score. We recommend spacing credit applications about 6 months apart.
• Check your credit reports and dispute any errors you find.

What goes into my credit score — and what doesn't?

When you or a lender "check your credit," a scoring model from either FICO® or VantageScore® is applied to the current data in one of your credit reports. Your score will vary, depending on which FICO® or VantageScore® version was used and whether it looked at your credit report from Experian®, Equifax® or TransUnion®. It can even vary month to month or day to day as new data get sent to your credit reports.

NerdWallet uses VantageScore® 3.0 and your TransUnion® credit report data. Most lending decisions are made using the FICO® model. If you have a good VantageScore®, you may also have a good FICO® score, because both consider much the same factors with some differences in how they weight them:

• Payment history: your record of on-time payments and any "derogatory" marks, such as missed payments, accounts sent to collections or bankruptcies.
• Credit utilization: balances you owe and how much of your available credit you're using.
• Age of credit history: how long you've been borrowing money.
• Applications: whether you've applied for a lot of credit recently.
• Type of credit: how many and what kinds of credit accounts you have, such as credit cards, installment debt (such as mortgage and car loans) or a mix.

A credit score does not consider your income, savings or job security. That’s why, in addition to your credit score, lenders also may check what you owe, how much you earn and assets you have accumulated.

How does NerdWallet get my score?

NerdWallet partners with TransUnion® to provide your VantageScore® 3.0, based on information in your TransUnion® credit report. Your score and credit report information is updated weekly. Note that lenders may make their approval decisions using a different credit scoring model or data source.