When was the last time you checked your credit score? If it's been more than a few months, you may be surprised to see where you stand now. Because of recent changes in the way your score is calculated, millions of people saw a big jump in their rating, while others where less fortunate. Because of these changes, millions of people saw a dramatic decrease in their score.
By checking your score online, you can get this information for free and see where you stand in relation to the national average. If your score is low, you may get a notice from your credit card companies informing you that they are reducing your spending limit. It could also increase your auto insurance rates and could impeded your ability to get a job.
But if your rating is above the national average, you can use this information to your benefit. A higher score could lower your monthly payments, minimum balances, and auto rates.
Why were these changes made? The credit reporting companies are always trying to improve the way they represent your creditworthiness. For that reason, they regularly review the way your score is calculated to make sure it accurately shows how likely you are to pay back your debts.
As more and more people figure out how this information is computed, they game the system and try to trick it to give them a higher score. As a result, the credit scoring companies have to make changes to stay one step ahead.