Credit Report, put-simply
What is a Credit Report? |
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A credit report is a record of one’s credit history. Put
simply, Credit Bureaus and Credit Reporting Agencies provide ‘credit
worthiness’ reports of individuals and corporations to other businesses,
such as banks, car dealerships, and other establishment that are
considering extending a line of credit. |
The Credit Report includes
whether or not you have paid your bills, re-paid outstanding loans, and how
much credit you have available. A Credit Report also includes monthly debts
and outstanding credits. It essentially is a report on how much risk is
involved with providing you with a load.
FICO Score
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In the US, Credit Bureaus give
individuals a ‘credit score.” Although there are several credit rating
systems (NextGen & Vantage), the ‘FICO Credit Score’ is by far the most
widely used. FICO is an acronym for ‘Fair Isaac Corporation.’ Your FICO
score and your credit report provide lending institutions with your
credit worthiness. |
The Credit Reports itself does
not state what kind of credit risk you are, it merely gives a record to the
loaners. The loaners then make the decision themselves whether or not to
extend credit. Credit bureaus collect this information and sell it to other
businesses in order to evaluate credit applications.
How is credit determined?
Credit is determined using a variety of
factors. Creditors look to see that one has been living a debt free life.
They like to see that all bills and other payments are paid on time. In
addition to this, creditors look to see if one is able to control his or her
debt well. This is done by not overspending, and saving money.
Individuals and or corporations with bad credit often have difficulty
finding financing, and in some cased will pay more then those with good
credit, in order to cover the risk of default. In addition, those with bad
credit often have problems securing a mortgage.
Via the internet, it is now possible for you to attain a copy of your Credit
Report. These are several online credit reports available online.
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