Many people do not know the difference between a credit report and a credit score. A credit report shows your credit history (example: payment history, number of inquiries, utilization, total of credit lines, etc.). A credit score on the other hand, is a number that is assigned on a scale of 300 – 850. The higher your score, the more favorable interest rates you will receive.
It is important for individuals to check their credit report, and to see if the information presented is accurate and contains no errors. When lenders pull your credit, they view your credit report, and then make a decision on whether or not to loan you funds. You want to ensure that what these lenders see, is a true depiction of your credit history. It is not uncommon to find errors such as: incorrect spelling of your name, incorrect social security number, open credit lines for which you have no knowledge, etc. It is your responsibility to have any errors identified corrected. Cleaning up your credit history may result in an increase in your credit score, even though this is not guaranteed.
You are entitled to receive one free credit report per year, from each of the three major credit bureaus: Transunion, Experian, and Equifax. You can make your request on AnnualCreditReport.com. You can choose to request all three reports at once, or space out the request throughout the year, the choice is yours. If you frequently check your credit report, then I want to say great job! If you haven’t as yet, then it is not too late.
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