When you borrow money, the bank sends information to a credit bureau which shares a detailed credit report on how well you have managed your debt. The credit report also includes a credit summary of all the loans and credit cards and their repayment history in addition to the personal identification information it has collected from the various lenders where you may have taken a credit card or a loan.
From the information received in the credit report, the credit bureau determines a credit score based on your previous credit performance, your current debt levels, the amount of time you have had the credit, the types of credit you have available and your pursuit of a new credit. Credit information companies have developed their individual credit scores, which is typically a three-digit number that represents a summary of individuals' credit history and credit rating. This score ranges from 300 to 900, with 900 being the best score.