Credit Reports and Credit Scores: A Basic Primer

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Financial institutions that lend money and provide credit utilize credit reports and credit scores to make lending and credit decisions. Consumers often have questions about credit reports and credit scores. This basic guide is intended to clarify some of the mysteries that surround these topics.


What’s in my credit report?

Your credit report contains information about:

  • Businesses that have given you credit or loans
  • The amount of each loan or credit limit for each credit card
  • How often you paid your credit or loans on time, and the amount you paid
  • Any missed or late payments, as well as bad debts

There are three major credit bureaus that will have reports on your financial history and behavior: Experian, TransUnion and Equifax. If you check your credit report with each bureau and find slightly different information on each report, don’t panic. Different lenders and financial institutions don’t always report your information to all three. If all the information on each is accurate, then there’s no need to worry.


There is a cost to access your report directly from these credit bureaus, but there is a workaround. By federal law, you are entitled to a free copy of your credit report every year. You can get this free report at the only website authorized by the U.S. government: Beware of other sites attempting to collect your personal data by claiming to be this site. During the pandemic, you can even get a free copy from all three bureaus instead of just one.


What is my credit score?

Your credit score is a number that lenders use to assess whether you’re likely to be timely and responsible in paying back your loan. It’s based on a number of factors from your credit reports. According to the Consumer Financial Protection Bureau (CFPB), your credit score is based on factors such as:

  • Your bill-paying history
  • Your current unpaid debt
  • The number and type of loan accounts you have
  • How long you have had your loan accounts open
  • How much of your available credit you are using
  • New applications for credit
  • Whether you have had a debt sent to collection, a foreclosure or a bankruptcy, and how long ago

Because your credit score is based on your credit reports from different bureaus and can vary over time, it’s important to remember that there is no “one true” credit score. It’s best to think of your credit score in a range. This infographic from the CFPB is helpful in understanding when and why your credit score might vary.


Most lenders require a credit score of at least 620 to qualify for a mortgage. Working to get your score above this number will help you feel more confident when you submit your next mortgage application.