4 Common Questions on Credit Reports

  • September 2, 2016
  • By: Greenpath Financial Wellness

One of our most well-attended GreenPath webinars is on Credit Reports and Scores. Below are some of the most common questions on credit reports that our clients ask.

What is a credit report?

It is a history of your ability to repay debt over time. On there, you can find previous addresses and any previous names you’ve had. You also will find your date of birth, and the last four digits of your social security number for verification purposes. It also has a list of all of your creditors and account status.   Some of the specific information included is when you opened accounts and if the account is current or past due.  All of these things get factored into your credit score. Not all credit reports are the same, it’s kind of like the difference between Pepsi, Coca-Cola, and Dr. Pepper; all sodas, but different recipes and more importantly different scoring ranges.

What is a credit score?

The credit score is a 3 digit number ranging from 300-850 that is used to show how well you are able to pay and manage your debt. It is composed of payment history, overall debt balances, credit history, and the type credit lines that you have.  In other words how credit worthy are you. The higher the score, can help to secure lower interest rates or down payments on loans.  So the score is a quick way lenders can identify if you are a risky consumer.

How can I obtain my personal credit report?

You have some free options.  As consumers we are entitled to get a free copy of your credit report per year by contacting the bureaus directly or you can use free credit report websites like www.annualcreditreport.com.

How does my credit history affect me?

It can affect your ability to get a new job, or securing housing. For example, if you have accounts that are in collections or have past due or inconsistent payment history this can prevent your score from moving up. And this will be one of the main reasons why you may not be approved or qualify for a line of credit.  Keep in mind that 35 percent of your score is positive payment history.

We hope you can join us on Wednesday, September 7 at noon ET. In the meantime, if you have additional questions, feel free to call us at 800-550-1961.