Damaging your credit rating is far easier to do than it is to repair and recover from a poor rating. Your credit rating can be affected by several factors some of which might not even be your fault such as theft of your wallet or identity theft, identity theft is on the increase as many have found and have also found that even despite their rating being poor through no fault of their own, it can take months if not years to re-establish a credit rating.
Your credit rating can be compared to taking a test, before the lender will give you a loan, credit card, mortgage or any other form of credit you have to pass this test. This is to ensure that you will be able to pay back the loan and thus reduces the risk that the lender is taking on you, the higher your rating is then the less risk you will be seen as and as such are more likely to get approved for a loan. If your credit score is low then your chances of getting approved will be very slim if any. [...]
Although the two terms are often thought to be related they are in fact two entirely different parts of a person’s credit history. However they are both very similar in their ways when it comes to the fact of your financial future and how likely you are to be approved for a loan. When it comes to dealing with matters relating to your