Credit Score Basics

What is a credit score?

A credit score is a number that helps lenders determine the likelihood that you will repay a credit obligation as agreed. If you have a high credit score the more likely you are to repay. Credit scores are designed to be consistent and objective based on the information within your credit report.

So what’s in my credit credit report?

Great question. Credit reports often contain four types of information: personal identifying information, trade lines, credit inquiries, and public records and collections.

Personal identifying information

This includes information used in connection with a credit account and includes: your name or nickname, current and former addresses, date of birth, social security number and phone number.   This information is not used in credit scoring.

Trade lines

These includes current and historical credit accounts lenders report on each account you have with them.  This includes the name of the creditor, the type of credit account (mortgage, bank card, installment, etc.), the date the account was opened and closed, the credit limit or amount, and the account payment history.

Credit inquires

When you apply for credit you authorize your lender to ask for a copy of your credit report. The inquire section of your credit report contains a list of every company that assesses your credit report within the last two years. For more information about how inquires effect your myFICO score click here [https://www.myfico.com/credit-education/questions/how-do-inquiries-impact-credit-scores/].

Public records and collections

This includes publicly available information including foreclosures and bankruptcies as well as civil suits and judgements. It is important however to note that the National Consumer Assistance Plan [https://www.experian.com/blogs/news/2015/05/20/consumer-assistance/] contains many changes to to how and what information is report.