Establish & Protect your Credit
A credit report contains information detailing a consumer's credit history. It provides information on how well the consumer has handled their financial obligations in the past. Information on your credit report can come from a number of sources: creditors and public records and are compiled by the three major credit-reporting agencies: Equifax, Experian and TransUnion.
Your credit report includes information such as:
- Personal Information - Name, address and social security number.
- Credit History - Details about credit accounts that were opened in your name
- Credit Report Inquiries - A listing of who reviewed your credit report
- Public Records - Matters of public record obtained from government sources such as courts of law - including liens, bankruptcies and overdue child support
While the credit reporting agencies do their best to keep your record free of errors, slip-ups happen. It’s important to check your credit report at least once a year. Consumers are entitled to one free credit report every 12 months, available at AnnualCreditReport.com to ensure all of the information is correct. Keep in mind that each agency may have slightly different information and consequently may have an errors that another credit report does not.
A Credit Score is a number that helps lenders determine how well you've managed your financial obligations in the past. It's determined by the three major credit-reporting agencies based on the information from your credit report. Your Credit Score is your FICO score and ranges between 301-850. It’s important to note that unlike your credit report, checking you credit score is NOT FREE and will cost on average around $7.00 to retrieve. Go to AnnualCreditReport.com to retreive your credit score.
What factors into your Credit Score?
- Payment History (35%) - Consistency matters, don’t skip payments!
- Debt / Amounts Owed (30%) - Keep debt to credit ratio as low as possible. A lower balance is better for your score.
- Age of Credit History (15%)
- New Credit / Inquiries (10%)
- Mix of Accounts / Types of Credit (10%)
What's your Score?
- Excellent Credit: 750+
- Good Credit: 700 - 749
- Fair Credit: 650 - 699
- Poor Credit: 600 - 649
- Bad Credit: Below 599
Does checking your Credit Report affect your Credit Score?
There are two kinds of credit checks: Soft & Hard. A Soft inquiry is when your credit is NOT being reviewed by a prospective lender. These include inquiries where you're checking your own credit for reasons other than extending your credit.
A Hard inquiry is where a potential lender is reviewing your credit because you've applied for credit with them. These include credit checks when you've applied for an auto loan, mortgage or credit card. Each of these types of credit checks count as a single inquiry. For many people, one additional credit inquiry (voluntary and initiated by an application for credit) may NOT affect their FICO score at all. For others, one additional inquiry may result in 5 less points on their FICO score.
Sources: Equifax, Experian, TransUnion and Federal Trade Commission