Credit Score

Your credit score is basically a report card for how you handle debt. FICO scores—the ones most lenders use—range from 300 to 850. VantageScore, another common model, uses the same range but weighs things a bit differently.

Here's what goes into your FICO score: payment history (35%—paying on time is the single biggest factor), credit utilization (30%—how much of your available credit you're using; keep it under 30%), length of credit history (15%—older accounts help), credit mix (10%—having a variety of credit types is a plus), and new credit (10%—too many recent applications dings your score).

The ranges roughly break down like this: 800-850 is exceptional, 740-799 is very good, 670-739 is good, 580-669 is fair, and below 580 is poor. These ranges directly affect the rates you'll get. The difference between a 660 and 760 score on a $300,000 mortgage could mean 0.5-1% more in interest—that's $30,000-$60,000 in extra cost over the life of the loan.

To boost your score, focus on: paying everything on time (autopay is your friend), getting credit card balances below 30% of your limits (under 10% is even better), keeping old cards open even if you don't use them much, going easy on new credit applications, and checking your credit reports for errors you can dispute.

You can check your credit score for free through most banks and credit card apps, plus you get three free annual reports from annualcreditreport.com. Checking your own score is a "soft inquiry" that doesn't affect it at all. Only "hard inquiries"—when a lender pulls your credit because you're applying for something—cause a small temporary dip.