10 surprising things you didn't know about your credit score

Many people know that having a good credit score is integral to making some of life's biggest purchases. Without one, it's challenging to qualify for a loan to buy a house or a car someday.

However, even though credit scores are really important, they're also a bit of a mystery. Not a lot of people know what makes up a credit score, how to improve them, or even how to check them!

So, below I've compiled 10 surprising things you probably didn't know about the elusive credit score, including the fact that credit scores really haven't been around that long at all.

1. Credit Scores Didn't Exist Until the 1950's

Before credit scores existed, you'd have to go and sit down and talk with a banker before getting a loan. So, the process was a little subjective. If the banker didn't like you or think you were trustworthy, you weren't going to be approved. In the 1950's two statisticians named Bill Fair and Earl Isaac founded FICO, but it took until the 1970's for the FICO score to be seen as integral to lending as it is now.

2. Your Credit Score May Predict How Long You'll Be Married

The Federal Reserve conducted an interesting study where it followed couples for 15 years to see how credit scores affected those in committed relationships. The study found that "the initial match quality of credit scores is strongly predictive of relationship outcomes in that couples with larger score gaps at the beginning of their relationship are more likely to subsequently separate." To put it another way, the closer your credit score is to your other half's credit score, the more likely you are to stay together.

3. TransUnion Started as a Railroad Leasing Company

The credit bureau, TransUnion, started as the Union Tank Car Company in 1968. In 1969, it acquired a business called the Credit Bureau of Cook County, which had millions of consumer card files located in 400 different cabinets. Eventually, it became the TransUnion we know today after spending 40 years collecting consumer data and developing technology that helps people and companies around the world.

4. Employers Cannot Get Your Credit Score

There is a pervasive myth that employers can screen you by finding out your credit score. This myth likely arose because people get the phrases "credit score" and "credit report" mixed up. Some employers do request permission to see your credit report, but it's typically a different version than the one you see and is used specifically for employment screenings.

5. Your Degrees Do Not Impact Your Credit Score

You could have lots of different letters after your name, but that doesn't mean you'll have a higher credit score than someone who only graduated from high school. Your education level does not factor into your credit score. There are 5 factors that determine your credit score and all of them have to do with debt and payments, not education.

A few other surprising aspects of your life that don't impact your credit score: the balance in your savings account, your stock portfolio, your employment status, and your salary.

RELATED: Check out the places where credit scores have risen the fastest:

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Places where credit scores have risen the fastest
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Places where credit scores have risen the fastest

1. Las Vegas, Nevada

When you imagine fiscal responsibility does Sin City spring to mind? Probably not and for a good reason. In 2016 the average resident in Las Vegas had a credit score of 645, which is below the national average. But it could be worse. In 2010 the average Las Vegas resident has a credit score of 626. That number is so low it makes it significantly more difficult for them to get approved for a mortgage. Overall from 2010 to 2016, Las Vegas residents increased their credit score by 3.04% – the fastest increase in the nation.

Photo credit: Getty

2. Fort Myers-Naples, Florida

Residents of the Fort Myers-Naples metro area saw some impressive gains on their credit scores. If we were measuring by points gained they would actually be tied with Las Vegas. The average resident grew her credit score by 19 points, up from 666 in 2010 to 685 in 2016. While 685 is pretty good there is always space to improve. For example, if you are the type who always pays off your credit card bills on time and in full, but uses most of your credit limit, consider asking for an increase of your credit limit. This will lower your utilization rate, an important metric which helps determine your credit score.

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3. (tie) Phoenix, Arizona

Phoenix residents tied with Palm Springs residents for third. On average, residents’ credit scores in the Phoenix area increased by 14 points, or 2.15%. Average scores rose from 651 in 2010 to 665 in 2016. Much of that increase came from Gen Xers and millennials. Gen Xers increased their credit scores from 616 to 642 on average. While millennials increased their scores from 598 to 621 on average.

Photo credit: Getty

3. (tie) Palm Springs, California

Palm Springs is tied with Phoenix at third for average credit score increase. In 2010 the average credit score in Palm Springs was 651 and by 2016 it had risen to 665. Unlike Phoenix however, it was the Baby Boomers doing the heavy lifting. Baby Boomers increased their credit scores from 654 to 687 on average.

Photo credit: Getty

5. Los Angeles, California

Los Angeles residents increased their credit score by the same number of points as Phoenix and Palm Springs but because they started from a higher number, they had a lower percent increase. But still a 2.13% change, from 656 to 670, is impressive. The good news for Angelenos is that almost all generations are taking measures to improve their finances. Every generation except the Silent Generation saw their credit scores rise from 2010 to 2016.

Photo credit: Getty

6. Austin, Texas

Austin was one of the more financially responsible cities in our top 10. The average credit score in Texas’ capital was 671 in 2016. That’s the third-highest score in the top 10. Overall the average credit score in Austin increased by 1.98% Unfortunately not all groups saw their credit scores increase. The Silent Generation and Generation Z both saw declines in their credit scores. 

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7. San Diego, California

San Diegans started 2010 with an average credit score of 665. By 2016 the average credit score rose 13 points to 678. That means that the average credit score in San Diego in 2010 was considered a “fair” score and in 2016 is was considered a “good” score. Having a “good” or better credit score is key to unlocking access to better credit card and mortgage rates.

Photo credit: Getty

8. Riverside-San Bernardino, California

Back in 2010 residents in Riverside-San Bernardino needed a financial intervention. They had an average credit score of 620, which not only locks them out from good mortgage rates, it also stops them from getting the best rewards credit cards. By 2016 they saw some improvement. Residents increased their credit scores by an average of 12 points from 620 to 632, for an overall increase of 1.94%.

There’s still room for improvement, of course and there’s a lot of work to be done for millennials and Generation Zers in Riverside-San Bernardino. Both those generations have average credit scores below 600. Some ways to improve your credit score are to pay monthly bills on time and lower your credit card debt. It’s also important to check you credit report for any inaccuracies and then work on getting any errors fixed.

Photo credit: Getty

9. Miami-Fort Lauderdale, Florida

Miami-Fort Lauderdale residents increased their credit scores by 1.86% from 2010 to 2016. Average credit scores in the area rose from 646 to 658 over that time. This metro area is unique in our top 10 in that all but one generation saw their average credit scores increase. Only the Silent Generation saw their credit scores decline over this time. But don’t feel too bad for them, the average credit score among Miami’s Silent Generation is above 700. 

Photo credit: Getty

10. Salisbury, Maryland

Rounding out our top 10 is Salisbury, Maryland. Salisbury is a city just south of the Maryland-Delaware border with a population around 33,000. Average credit scores in the Salisbury area went from 658 to 670. That’s an increase of 12 points, or 1.82%. Generation Z, in particular, saw a dramatic increase in average credit scores, up from 533 in 2010 to 626 in 2016.

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6. The FICO Score Has a Competitor

The three major credit bureaus joined together to create a new type of credit score called the Vantage Score, a score that competes directly with FICO. More and more companies are using Vantage Scores to help determine a consumer's credit worthiness.

7. You Can Still Get a Mortgage with a "0" Credit Score

If you don't have any open credit accounts or you never opened any to begin with, your credit score eventually becomes a 0. However, even if your credit score is 0, you can still get a mortgage through a process called manual underwriting, where the mortgage company takes all of your assets and monthly bills (like cable) into consideration before potentially approving you for the loan.

8. Closing Your Credit Cards Can Hurt Your Score

The age of your accounts is an important factor in determining your credit score. If you close your oldest account, it could cause your score to drop. Also, all of the available "space" on your credit cards helps to show credit-worthiness. Closing cards shrinks your credit "space" and an easy way to potentially boost your score is to request a credit limit increase.

9. Car Insurance Companies Use Your Credit Score (Sort Of)

When you apply for car insurance, having good credit matters. While car insurance companies won't use your FICO score to help determine your insurance rates, 92% of insurers use something called a credit based auto insurance score. The data in this score helps to show insurers whether or not you're likely to file a claim along with other data.

10. Credit Scores Aren't the Only Predictor of Bad Financial Behavior

Many people worry about their credit scores, especially if they've had a late payment in the past. However, many people don't realize that there are also other financial reporting agencies that keep track of other financial transactions, like how you treat your bank account. Banks use reporting from companies like TeleCheck, ChexSystems, and EWS to determine whether or not you should be allowed to open a checking account.

So, as evidenced, your credit score is actually pretty interesting!

Not only does it help show lenders whether or not you're a good borrower, but it can also predict your relationship success. Also, your credit score is private, but sometimes employers and insurance companies can see versions of your score and credit report to learn more about you as a consumer.

Ultimately, having a good credit score really is important, and the best way to have a good score is to keep making your payments on time, have a variety of accounts, check your credit score regularly, and keep your credit card balances nonexistent. This can help you to qualify for larger purchases down the road and can prove that you're trustworthy when it comes to your finances.

More from Credit.com:
Can My Taxes Mess With My Credit?
5 Totally Debt-Free Ways to Boost Your Credit

This article originally appeared on Credit.com.

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