Free Annual Credit Report Information
What is a credit report?
Well, it’s actually quite simple to explain. A credit report is a record of an individual's (or business) credit history, which is prepared by a credit bureau. This history includes past borrowing and repayments, including information about late payments and bankruptcy- in essence, it’s a synopsis on an individual’s credit related activities.
Why is having your credit report important?
Would you lend money to a perfect stranger? Probably not. Well, just as you wouldn't hand over your hard earned money to someone you didn't know, neither would most banks or retailers. Hence the importance of a credit report.
A credit report is a reflection on your ability to repay monies lent. This is what lenders look at to determine credit worthiness. It is important to understand what is in your credit report, so that you can correct inaccuracies if any.
How do I get my free annual credit report?
There are three nationwide credit reporting companies — Experian, Equifax, and TransUnion. The Fair Credit Reporting Act guarantees you access to your credit report for free from each of these three reporting companies, once every 12 months.
To exercise your right to a free credit report you can call 877-322-8228 or visit AnnualCreditReport.com.
This is the ONLY authorized source under federal law for a truly free annual credit report.
What is the difference between Credit Reports and Scores?
Just as a written credit report is a record of credit history, a credit score is simply a number that represents the "creditworthiness" of an individual. Pretty much the likelihood that a person will pay off any debt incurred.
This score is called a FICO score.
FICO scores range between 300 and 900.
Higher scores are considered better scores. That is, the higher your score, the more favorably lenders look upon you as a credit risk.
A FICO score is calculated based on the information contained in your credit history. While knowing your actual score is a great start, understanding the key factors affecting your FICO score is much more important.
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