14 Credit Reports and Scores Flashcards
What is a credit bureau?
A firm that collects and keeps records of many borrowers’ credit histories.
Credit bureaus play a crucial role in the credit system by providing lenders with information on potential borrowers.
Define credit history.
A continuing record of a person’s credit usage and repayment of debts.
Credit history is essential for lenders to assess the risk of lending to an individual.
What is included in a credit report?
Information compiled by a credit bureau from merchants, utility companies, banks, court records, and creditors about your payment history.
A credit report provides a comprehensive overview of an individual’s credit behavior.
What does a credit score represent?
A statistical measure used to rate applicants based on various factors deemed relevant to creditworthiness and the likelihood of repayment.
Credit scores typically range from 300 to 850, with higher scores indicating better creditworthiness.
What is a personal statement in the context of credit reporting?
Your version of disputed information in your credit report (in 100 words or less) when the credit bureau refuses to remove the disputed item.
A personal statement allows individuals to present their side of the story regarding negative items on their credit report.
