Why do financial institutions use credit scores?

Credit scores give lenders, employers, landlords, and utility companies an instant snapshot of how you manage your money and credit. It helps making the decision of whether or not to approve your credit an easy one. In short, credit scores are easy to use.

Every lender uses and interprets your credit score in different ways. Some lenders use your score as a big part of their decision to approve or deny you credit while others use your score as a small part of their decision. That is why shopping around for credit cards and loans is so important.