Your credit scores are determined by credit scoring models that analyze one of your consumer credit reports and then assign a score (often ranging from 300 to 100 using complex calculations. This is based on the entire amount you owe, the number and types of accounts you have, and the amount of money owed compared to how much credit you have available.
High balances and maxed-out credit cards will lower your credit score, but smaller balances may raise it – if you pay on time. Your credit score is calculated using a formula, taking into account your; payment history and the length of it, the balance owed, debt levels, and the number of credit accounts you have. This information is collated from credit reports put together by credit bureaus for lenders to assess.
5 factors that determine your credit score?
The primary factors that affect your credit score include:
- Your payment history
- The amount of debt you owe
- How long you’ve been using credit
- New or recent credit
- Types of credit used
What is an acceptable credit score in South Africa?
Anything above 670 would be considered a “good” score. Below 600 would be considered high risk. You’ll want to look at ways to improve your credit record.
5 Steps to improve your credit score
- Stay on top of financial commitments. Timely payments will increase your score
- Pay your debts
- High outstanding debt will negatively affect your score while paying it off will improve your score, keep track of your credit score by viewing your online Credit Report with Splendi, click here for an updated Credit Report
- Keep your credit limits high and what you owe low
- Know your rating and keep informed by viewing your Credit Report regularly
Should you need assistance with queries and disputes feel free to email our team on info@splendi.co.za
