A credit score and credit report are two different things. The credit score can be calculated based upon your credit activity. A credit report, however, contains information about your payment history. In this article, we will discuss the differences between these two documents and how they are different from one another. This article will also help you understand the importance of your payment history to your credit score. Continue reading to learn even more. Below are the key differences in credit score and credit report.
Differences between credit score and credit report
Although you might have heard of credit scores, you aren't sure how to interpret them. There are major differences between a credit rating and a credit report. Your credit score is a numerical evaluation of your financial history based on your past behavior. While a credit file provides more detail about your financial history, a score on credit is a single numerical number that lenders use for determining if you're a suitable candidate for credit.
Credit reports can show the borrower's credit history, including when they borrowed money and when they paid it back. Lenders use credit scores, which are three-digit numbers, to determine a borrower’s creditworthiness. Your credit report lists all of your accounts along with their age. You may also find negative information such as late payments. Credit scores can be good to excellent in general, but they can vary greatly.
Credit reports contain information
Credit reports provide information about your financial background, including how much you borrowed and repaid. They also include details such as the number of accounts that you have opened and closed, as well as whether or not you had any late payments. You can also see if you've ever applied for credit. This information can stay on your file for years. This information is used to determine whether you are eligible for credit. Other people can also request a copy of your credit report, such as your employer or landlord.
Your payment history is one the most important pieces in a credit report. This includes all accounts you've opened over the past seven-ten years, as well any joint accounts for which you were listed as an authorized use. Your credit history also includes information about your repayment history, such as installment loans or credit cards. In addition to these items, your credit report will list any judgments or tax liens.
The impact of payment history on credit scores
Your payment history is one of the most important factors in your credit score. Late payments can damage your credit score and be visible on your report for up to seven year. While one or two slip-ups might not hurt your score, multiple late payments can negatively impact your score. Your payment record is a record that shows you when and how late you paid on all your accounts. This includes personal loans and credit cards. Your payment history shows lenders how likely it is that you will default on your accounts.
While FICO's 35% estimate is a rough guideline, your actual impact could be greater or less. A few late payments may have a greater effect on your credit history than a long history with timely payments. In such cases, refinancing your current loan could be the best option. As mentioned, refinancing your existing loan could also improve your score. Refinancing your car or home loan is a great way to improve your credit score.