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Credit Reports and Credit Bureau

Credit Reports and Credit Bureaus
About, Why Check?, Credit Report Monitoring Services

About Credit Reports
Credit Bureaus (Credit Rating Agencies (CRA)) are large private credit data gathering agencies. Their purpose is to provide financial information to issuers of certain types of debt obligations. The financial information they provide about individuals (and businesses) is used to determine the credit worthiness of each person (or business). A persons (or businesses) credit worthiness is established according to their financial history, the ability to pay back loans, and current financial obligations (current bills). The interpreted level of credit worthiness is called a Credit Score. A higher credit score=higher credit worthiness. It is important to have a high credit score because this number is used to determine if you qualify for loans and other dept obligations. Also, this number (credit score) affects the interest rate applied to loans. Those with higher credit scores are considered to be low risk and receive better interest rates than those with low credit scores (high risk & bad credit, or no credit rating at all).

What is a FICO score?

FICO score - is another name for Credit score. FICO stands for Fair Isaac & Company …the actual company who pioneered this mathematical calculation, during the late 1950s. FICO scores are the credit scores most lenders use to determine your credit risk. The better your score, the lower the risk to the lender, the better chance you have to get a loan and at a lower interest rate.


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About Credit Reports, Credit Ratings, and Credit Scores
Credit Scores Range from 620 to 850. The US average credit score is 678. 
Basic Ratings (Credit Scores)
Excellent: 750-850
Good: 660-749
Fair: 620-659
US average credit score: 678
Some positive elements of a credit profile
A positive credit report
A home with a mortgage
An American Express Card and/or Diner's Club Card
A job held for a year or more
Current or paid off bank loan
A Visa or Mastercard
A department store credit card
A telephone in your name
Other things which contribute to your credit score: Marital Status, Age, Monthly Income, Checking or savings account, Monthly loan and credit card payments, Credit History, Residence (rent, own), and how long you lived at your previous residence.

Your credit profile, will determine how easy or difficult it is to get bank loans, auto loans, personal loans, credit cards or any other form of financing. Your profile can also determine what interest rates you pay, and in some, whether you get a job or able to obtain a larger life insurance policy. Your credit profile with show your prospective creditors a summary of your financial history on file with the credit bureaus.

Ideally, your credit report is an accurate, up-to-date reflection of your credit history. However, since we don't live in an ideal world, there are many reasons that your credit report could contain inaccuracies that might prevent you from receiving the credit you deserve. Therefore you should check your credit report regularly to spot and correct inaccurate information (79% of credit reports contain errors).

Another increasingly important reason to check your credit report is identity theft . You may not think it will happen to you but it does happens up to 500,000 people each year. If someone steals your credit card information or personal information and makes unauthorized purchases, it will not be long before these unpaid debts appear on your credit report. There are companies that can help you to repair and optimize your credit score.






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