Glossary term
Credit Score
A credit score is a three-digit number that summarizes how risky you look as a borrower, based on the information in your credit reports. Most widely used models run from 300 to 850. Lenders use scores to decide whether to approve you and what rate to charge, so a higher score usually means cheaper credit.
Updated October 17, 2026 · Editorial Team
How Credit Score works in practice
Scores are built from your credit report data: whether you pay on time, how much of your available credit you use, how long your accounts have been open, the mix of credit types, and how recently you applied for new credit. Payment history and utilization usually carry the most weight. Different scoring models and bureaus can produce different numbers for the same person.
To see why the score matters, picture the same $25,000, 60-month loan offered at 6.00% to one borrower and 9.00% to another. At 6.00% the payment is $483.32 and total interest is $3,999.20. At 9.00% the payment is $518.96 and interest is $6,137.60, a $2,138.40 difference driven largely by credit.
You can check your credit reports for free and dispute errors, which is the foundation of any score. Paying every bill on time, keeping card balances low and applying for new credit only when needed are the habits that tend to lift a score over time.
Credit Score: quick questions
What is the range for a credit score?
Most common scoring models run from 300 to 850, with higher numbers signaling lower risk. Some specialized models use other ranges.
Why do I have different scores?
Lenders use different scoring models, and each credit bureau may hold slightly different information, so your number varies by source.
Does checking my own score lower it?
No. Checking your own credit is a soft inquiry and does not affect your score. Applications for new credit can create hard inquiries.
Sources
- Credit reports and scores — Consumer Financial Protection Bureau. Accessed October 17, 2026.
- AnnualCreditReport.com — Central Source LLC (authorized by federal law). Accessed October 17, 2026.
We cite primary sources: regulators, central-bank data and federal agencies. Worked examples on this page are our own calculations. See our methodology.
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