Credit Reports, Credit Scores and Credit Monitoring

A credit report will provide creditors and lenders data about your credit history. The information obtained on this report is used to help these companies get a good look of your borrowing and will also be able to tell how you have paid your bills. The credit report will also contain all information on any past late payments, bankruptcies and foreclosures. In most cases, your credit report will be used when you are applying for a loan or trying to get insurance. See how you can get yourself a free credit report.

A credit score is used by lender, creditors, insurers, landlord and more to make decisions about what rate you get. A good score can help you save thousands.

The information on your report will have your name, current and former address, where you work, all charge and financial histories, all of the inquiries that have been made on your account, the past and current collection and public records such as bankruptcy and tax liens. Each of the credit cards that you have or have possessed in the past, as well as any loan records going back for the past seven years, along with any other account details such as your credit limit.

Credit card companies and lenders report information to credit bureaus electronically. There’s no fixed schedule for this reporting, but most companies send an update every 30 days. Other records are sent by the courts, tax agencies, and post office.

Credit Scores

A credit score can show a discrepancy depending on which credit organization you utilize. There may even be times that a person could have a different credit score when applying for home loans, than there is when they apply for a car loan. Credit scores usually range from 375 to 900 points, obviously the higher your score the better of a person will be when trying to acquire financing. The average credit score is between 650 and 675, anything above 700 is considered very good. A score of 600 or below is usually considered poor and needs to be improved.

People that have a low credit score may not be able to get the best rates or deals, but they could still get approved for a loan. Those who have bad credit can expect to pay a much higher interest rate once they are approved for a loan.

Improving your credit.

The first and most obvious is to pay your bills and pay them on time. As most of us know, late payments and missed payments have a negative impact on your score. Paying your bills and making them on time will have a good impact. If you have maxed out your credit cards, try and pay the balance down as much as you can.