Well your credit card score is actually a compilation of your fiscal responsibility for your entire life. It is whether you have paid off your monthly payments on time or have been late frequently. It is basically the amount of trust that a lender has in you on whether or not you will be making your payments on time or whether he will potentially lose all his money because you may have filed for bankruptcy before. Basically the way it works the better of a score you have the lower of an interest rate you have and the more money a lender will be willing to trust you with. If you have a bad score, the lender is taking a substantial risk in you therefore he ends up raising your interest rate up to double or even triple of what you would have had to pay if you had a good credit score. Essentially it means that if you have a good score, you will get a good rate, if you have a bad score, try hard to raise that score and get a better rate in doing so.

 

 

Editorial by Director of Information: Thomas Krzeminski