A credit rating is an evaluation of the credit worthiness of a debtor, especially a business (company) or a government, but not individual consumers. The evaluation is made by a credit rating agency of the debtor's ability to pay back the debt and the likelihood of default.Evaluations of individuals credit worthiness is known as credit reporting and done by credit bureaus, or consumer credit reporting agencies, which issue credit scores.
Credit History or credit report is, in many countries, a negative record of an individual's or company's past borrowing and repaying, including information about late payments and bankruptcy.
What is Credit Score? : Before deciding on what terms they will offer you a loan (which they base on their "risk"), lenders want to know two things about you: your ability to pay back the loan, and your willingness to pay back the loan. For the first, they look at your income-to-debt obligation ratio. For your willingness to pay back the loan, they consult your credit score. The most widely used credit scores are FICO scores, which were developed by Fair Isaac & Company, Inc. (and they're named after their inventor!). Your FICO score is between 350 (high risk) and 850 (low risk).
Credit scores only consider the information contained in your credit profile. Different portions of your credit history are given different weights. Thirty-five percent of your FICO score is based on your specific payment history. Thirty percent is your current level of indebtedness. Fifteen percent each is the time your open credit has been in use (ten year old accounts are good, six month old ones aren't as good) and types of credit available to you (installment loans such as student loans, car loans, etc. versus revolving and debit accounts like credit cards). Finally, five percent is pursuit of new credit -- credit scores requested. One can follow certain FICO guidelines to improve Credit Score.
How to Obtain Your Free Credit Report: You can obtain a free copy of your credit report, once every 12 months, from each of the three national credit reporting agencies – Equifax, Experian, and Trans Union. The free report is available only through a centralized website, phone number, and address established by Equifax, Experian, and Trans Union. You can request your free credit report by visiting the website www.annualcreditreport.com, calling 1-877-322-8228, or completing the annual credit report request form available at www.ftc.gov/credit and mailing it to Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281. You have the option of ordering a credit report from each of the three credit reporting agencies at the same time or you may stagger your requests during the 12-month period.
In order to get your free report, you must furnish proper identification information before the credit reporting agency will send you the report. Be prepared to provide your full name, date of birth, social security number, and current address. Furthermore, for your security, Equifax, Experian, and Trans Union may ask you for information that only you would have knowledge of, e.g. a previous address or monthly mortgage payment.
If necessary, you may obtain a copy of your credit report directly from a credit reporting agency. The credit reporting agency, however, may charge you up to $11.00 for a copy of the report. To purchase a copy of your credit report, contact one of the following credit reporting agencies:
Equifax : 800-685-1111
Experian: 888-397-3742
Trans Union:800-888-4213
Fixing credit report errors:
With respect to credit reporting agencies, the Federal Trade Commission (FTC) enforces the Fair Credit Reporting Act. If you have concerns regarding your credit report or credit reporting agencies, please contact the FTC at www.ftc.gov or call toll free 1-877-382-4357.
Equifax Disputes (1-866-238-8067), P.O. Box 740256, Atlanta, GA 30374-0256Experian Disputes (All disputes with Experian are handled online)TransUnion Disputes (1-800-916-8800) , 2 Baldwin Place, P.O. BOX 1000, Chester, PA 19022
The Fair Credit Reporting Act (FCRA) is designed to help ensure that credit bureaus furnish correct and complete information to businesses to use when evaluating your application. Your rights under the Fair Credit Reporting Act:
Credit History or credit report is, in many countries, a negative record of an individual's or company's past borrowing and repaying, including information about late payments and bankruptcy.
What is Credit Score? : Before deciding on what terms they will offer you a loan (which they base on their "risk"), lenders want to know two things about you: your ability to pay back the loan, and your willingness to pay back the loan. For the first, they look at your income-to-debt obligation ratio. For your willingness to pay back the loan, they consult your credit score. The most widely used credit scores are FICO scores, which were developed by Fair Isaac & Company, Inc. (and they're named after their inventor!). Your FICO score is between 350 (high risk) and 850 (low risk).
Credit scores only consider the information contained in your credit profile. Different portions of your credit history are given different weights. Thirty-five percent of your FICO score is based on your specific payment history. Thirty percent is your current level of indebtedness. Fifteen percent each is the time your open credit has been in use (ten year old accounts are good, six month old ones aren't as good) and types of credit available to you (installment loans such as student loans, car loans, etc. versus revolving and debit accounts like credit cards). Finally, five percent is pursuit of new credit -- credit scores requested. One can follow certain FICO guidelines to improve Credit Score.
How to Obtain Your Free Credit Report: You can obtain a free copy of your credit report, once every 12 months, from each of the three national credit reporting agencies – Equifax, Experian, and Trans Union. The free report is available only through a centralized website, phone number, and address established by Equifax, Experian, and Trans Union. You can request your free credit report by visiting the website www.annualcreditreport.com, calling 1-877-322-8228, or completing the annual credit report request form available at www.ftc.gov/credit and mailing it to Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281. You have the option of ordering a credit report from each of the three credit reporting agencies at the same time or you may stagger your requests during the 12-month period.
In order to get your free report, you must furnish proper identification information before the credit reporting agency will send you the report. Be prepared to provide your full name, date of birth, social security number, and current address. Furthermore, for your security, Equifax, Experian, and Trans Union may ask you for information that only you would have knowledge of, e.g. a previous address or monthly mortgage payment.
If necessary, you may obtain a copy of your credit report directly from a credit reporting agency. The credit reporting agency, however, may charge you up to $11.00 for a copy of the report. To purchase a copy of your credit report, contact one of the following credit reporting agencies:
Equifax : 800-685-1111
Experian: 888-397-3742
Trans Union:800-888-4213
Fixing credit report errors:
With respect to credit reporting agencies, the Federal Trade Commission (FTC) enforces the Fair Credit Reporting Act. If you have concerns regarding your credit report or credit reporting agencies, please contact the FTC at www.ftc.gov or call toll free 1-877-382-4357.
Equifax Disputes (1-866-238-8067), P.O. Box 740256, Atlanta, GA 30374-0256Experian Disputes (All disputes with Experian are handled online)TransUnion Disputes (1-800-916-8800) , 2 Baldwin Place, P.O. BOX 1000, Chester, PA 19022
The Fair Credit Reporting Act (FCRA) is designed to help ensure that credit bureaus furnish correct and complete information to businesses to use when evaluating your application. Your rights under the Fair Credit Reporting Act:
- You have the right to receive a copy of your credit report. The copy of your report must contain all of the information in your file at the time of your request.
- You have the right to know the name of anyone who received your credit report in the last year for most purposes or in the last two years for employment purposes.
- Any company that denies your application must supply the name and address of the credit bureau they contacted, provided the denial was based on information given by the credit bureau.
- You have the right to a free copy of your credit report when your application is denied because of information supplied by the credit bureau. Your request must be made within 60 days of receiving your denial notice, or if your credit report is inaccurate due to fraud, including identity theft.
- If you contest the completeness or accuracy of information in your report, you should file a dispute with the credit bureau and with the company that furnished the information to the bureau. Both the credit bureau and the furnisher of information are legally obligated to investigate your dispute.
- You have a right to add a summary explanation to your credit report if your dispute is not resolved to your satisfaction.
- An Annual report from Equifax in December.
- An Annual report from Experian in May
- An Annual report from TransUnion in September
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