Credit Report and Credit Score FAQ
What Exactly Is a Credit Report?
A consumer credit report is a document that contains a factual record of an individual's credit payment history.
Credit providers are permitted by law to review your credit report to objectively determine whether to grant you
credit. There are 190 million credit active people in the United States who have a charge account, car loan,
student loan, or home mortgage.
As those people pay their bills, most lenders report credit payment information to credit bureaus. So most of the
information in your consumer credit report comes directly from the companies you do business with.
What is a Credit Risk Score?
A credit risk score is a statistical summary of the information contained in a consumer's credit report.
Sophisticated mathematical processes calculate scores by assigning numerical values to various pieces of
information in the credit report. Credit bureaus provide risk scores to credit providers who use them to
objectively evaluate an applicant's credit-worthiness.
The score itself is relative and will be viewed differently by creditors depending on numerous factors, including
the creditor's risk level, marketing goals, and business practices. Your risk score will change over time as your
credit history develops.
Do I Have Good Credit?
You are most likely already familiar with the concept of "credit," the reputation for paying your bills
on time that makes it possible for you to obtain money or goods with the understanding that you will pay for them
later.
But even if you use your credit every day, you may have questions about the credit industry and how it affects you.
In today's society, credit is much more complicated than keeping a tally at the local grocery. As a credit-active
consumer, you need to know how credit reporting works and what your credit report contains.
Does My Credit Report Contain Other, Unrelated Personal Information?
No. Your consumer credit report does not contain information about your race, religious preference, medical history,
personal lifestyle, personal background, political preference or criminal record.
How long Does Information Stay on My Credit Report?
Positive credit information remains on your report indefinitely, although information about an account will cycle
off your report if no new information is reported about it for seven years. (Thus, a closed account will disappear
from your report seven years after it is reported closed by the credit grantor.)
What Is an Employment Report?
An employment report is a modified credit report that helps potential and current employers make hiring and
promoting decisions. The employment report contains much of the same information about your loans and credit
cards that your credit report has listed. However, your marital status, year of birth, and account numbers are
omitted from the employment report.
What Is a Mortgage Report?
A mortgage report is a special credit report that lenders use prior to deciding whether or not to extend you a
home loan. Each report is compiled from credit reports from two or three credit bureaus. The mortgage credit
reporting company purchases credit reports from the credit bureaus, combines them, and manually verifies specific
information such as employment, credit account balances, and public record information.
Who Checks My Credit Report?
Federal law carefully regulates how credit reports can be used and by whom. By law, you have the right to obtain
your own reports at a reasonable price. Before they can access consumer credit information, businesses must offer
proof that they will be using the data for no other purpose than that allowed by federal law.
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