A credit score and credit report are two different things. The credit score is determined by your credit activity. However, your report includes information about your payment history. We'll be discussing the differences in these two documents and their similarities. This article will give you an insight into how your payment history affects your credit score. Continue reading to learn more. The key differences between a credit score and a credit report are detailed below.
There are differences between a credit score (or credit report)
Although you might have heard of credit scores, you aren't sure how to interpret them. There are many differences between a Credit Score and a Credit Report. Your credit score is a numerical assessment of your financial history, based on past behavior. While a credit report is a more comprehensive overview of your financial history, a credit score is a single, standardized number that lenders use to decide whether you're a good candidate for credit.
Credit reports show a borrower's history of borrowing money and repaying it. Credit scores are three-digit numbers that lenders use to determine a borrower's credit worthiness. Your credit report lists all of your accounts along with their age. There may be negative information like late payments. Credit scores are generally good to excellent, but they can vary wildly.
Information in credit reports
A credit report provides information on your financial records, such as how much debt you've repaid, what accounts you have open, closed, and whether there were any delinquent or late payments. It also includes whether you have ever applied for or received credit. This information could be on your credit report for years. This information can be used by financial institutions for deciding whether to extend credit. An additional person can also request a copy, such as your landlord and employer.
Your payment history is one the most important pieces in a credit report. This includes any accounts that were opened during the past seven to ten-years, and joint accounts that have been authorized users. Your credit history also includes your repayment history, including installment loans and credit cards. Your credit report will also include any judgments and tax liens.
Impact of payment history on a credit score
One of the most important aspects in credit scores is payment history. Late payments can have a negative impact on your credit score for up to seven years. A few slip-ups can not harm your credit score but multiple late payments can. Your payment history includes all of your late and on-time payments for all accounts. This includes credit cards, personal loans, lines of credit, and credit cards. Your payment history shows lenders how likely it is that you will default on your accounts.
FICO's estimate of 35% is an approximate guideline. Your actual impact may be higher or lower. You may experience a smaller credit history than someone with a history of regular payments. In such cases, refinancing your current loan could be the best option. Refinancing a loan you already have could also improve your credit score. If you're concerned about your credit score, refinancing a home or car loan is an excellent option to repair your credit.