Credit scores can have a big impact in many areas. Credit scores determine if someone gets approved or
declined on any type of credit.

Credit scores are defined as
numerical expression based on a statistical analysis
of a person’s credit files, generated by a
mathematical algorithm.

To be more exact, credit scores are determined on
the basis of the certain amount of credit a person has
taken.

Their credit statements are compared with the accounts
of other people applying for credit to the same
financial body.

Bankers and credit card companies are considered
lenders who use credit scores to evaluate the
potential risk while lending money to the consumers
and to alleviate potential losses due to bad debt.

Credit scores are being used by the lenders to
determine who qualifies for a loan and who does not,
at what interest rate, and what credit limits they
could lend the money to the person and in what time
and what interest they could get their refund back.

The people with the highest score get the lowest rate of
interest rates, simple as that.

Different countries use different techniques to make
credit scores and similarity is found between Canada
and USA. But the system is said to be better in
Australia than the USA.