Your credit score is a vital part of your financial health and wellness. When was the last time you got a checkup? With Rocky Mountain Credit Union’s SavvyMoney tool, you can keep an eye on your credit score with sophisticated monitoring and reporting to help you stay on top of your credit and keep your finances fit. Here’s a rundown of everything you need to know about your credit score and how SavvyMoney can help you monitor it.
Why is your credit score so important?
If you’re buying a home or a new car, applying for a credit card, or simply thinking about doing any of those things in the future, your credit score matters. This number helps lenders understand how likely you are to repay your loan and make payments one time. It speaks to the level of risk they’d be taking on by lending to you. In general, the higher your credit score, the better terms and interest rate you may qualify for.
What is SavvyMoney?
SavvyMoney is a credit monitoring program that you can take advantage of directly through your RMCU online account. It gives you a real-time picture of your credit score and the factors affecting it so you can keep track of what’s going on. You’ll find insightful reports that break down the factors affecting your credit, and it helps you monitor for unexpected changes to your credit. Keeping on top of your credit health goes a long way towards thriving finances.
What contributes to your credit score?
Factors like your payment history, credit usage, credit age, mix of credit and recent credit can all impact your score. Payment history is just what it sounds like: do you have a history of paying at least your minimum payment, on time? Credit usage measures how much of your available balance you’re using at any given time. If you have a credit limit of $5,000, and your balance is $2,500, you have a credit utilization of 50 percent. For an optimal credit score, you usually want to keep that number below 20 percent.
Credit age refers to the length of time you’ve had a particular line of credit, and what your recent usage has been. In general, the longer your history, the better. Whether or not you have a mix of credit, like student loans, auto loans and a mortgage, not just credit cards, also has an impact. And recent credit looks at your latest activity. If you’ve opened a lot of new credit lines in a short period, it could signal to lenders that something’s up.
What is a credit inquiry and how does it affect my credit?
A credit inquiry is when an organization looks into your credit for any reason. There are two types of inquiries: hard and soft.
A hard inquiry on your credit is what typically happens when you apply for a loan or a new credit card. These inquiries require your permission and show up on your credit history, typically for about two years. If you have too many hard inquiries in a short period of time, it can negatively impact your credit score. But if you’re shopping around for a mortgage or something similar, don’t worry — multiple of the same type of inquiry within a two-week period only get counted as one.
A soft inquiry, on the other hand, is commonly used for employment verification, insurance quotes, and you personally checking up on your credit score. This is what SavvyMoney uses to monitor your credit, so you can see what’s going on day to day without your credit taking a hit.
If you’re a member interested in using SavvyMoney to monitor your credit, you can do so through the RMCU mobile app or online banking. If you’re not a member, make an appointment at your local branch to become a member and start taking advantage of SavvyMoney today!
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