Credit Report vs. Credit Score
June 3, 2013
Question: What is the difference between a credit report and a credit score?
Answer: A credit report is sort of like a report card of your credit history. The credit report includes your personal information (such as your name and previous addresses), all of your past and present credit accounts from the last 7-10 years, and any credit inquiries for new credit. A individual’s credit report will also reflect payment history and if there are any delinquent accounts.
A credit score is a number that represents a person’s creditworthiness. It is statistically calculated based on several factors. These factors include payment history, credit utilization, length of credit history, types of credit used, and recent credit inquiries.
Credit scores range from 300-850 and the higher the number, the better off a person will be. Having a higher credit score means that someone has credit and uses it responsibly. These people are often given better interest rates on credit cards, car loans, and home mortgages. Getting good interest rates on loans can save hundreds or thousands of dollars over the years.
Consumers are allowed an annual credit report for free, whereas one must pay for their credit score.
–Niomi Williams, Financial Literacy Educator
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