Credit Scores and Reports from Major Credit Bureaus

Credit Scores and Reports: how do the things work?

Credit reports are compiled by credit bureaus and contain information about your credit history. This information includes: the status of the credit accounts, payments history, amount of available credit, amount of credit in use, bankruptcy records and some other negative public records. The information in your credit reports influences your credit scores.

The credit reports can be requested at no cost once every 12 months. You can choose to request reports from the credit bureaus all at once or one report at a time. If you choose to get your credit reports separately, you can monitor your credit file at no cost more frequently during the year.

But your free credit report does not include your credit score. You usually have to pay if you want to get your credit scores. The credit score is a number which helps creditors to predict your ability to pay back. You can buy your credit scores from the same credit bureaus, but you are not required to purchase credit protection, identity theft monitoring, or other services you may be offered.

So why do you need all this stuff?

Keeping credit reports in good standing and credit scores high is important because these are the first things credit issuers check when deciding whether extend you credit or not. The reports help them to determine the amount of the loan and the interest rates. So the better your credit report and the higher your credit score, the more advantageous credit terms you will be offered.

Not only lenders and credit card issuers use your credit report. Insurance companies, rental agencies and even your future employer can request your credit report before making any decision.

Getting and keeping a good credit score is not a big deal as some may think. You just need to pay all your bills on time. You should be moderate and not to use too much of the available credit. You shouldn't apply for the card you do not need and should keep information in your credit reports correct.