The Importance of a Credit Report

Your credit report in combination with your credit score is as important as the air you breathe. Without it, you won’t stand a chance or survive in the United States. To most of the country, you are just a number in conjunction with a credit history. It does not matter whether you are good person, volunteer, lie or cheat. It only matters how responsible you are with your personal finances.

The simplest way to find out about your credit history is to order a copy online. You want a website that provides you with information from the three major credit bureaus;Experian, TransUnion and Equifax. These bureaus analyze your financial decision making; both past and present, and put that information into a report. A good website to use that provides this information is It only costs $1 to check and can provide you with invaluable information compiled into a credit report. Your report will not only provide your current credit score, but also your entire credit history.

A credit report acts as your credit references. A positive credit history tells potential lenders that you manage your finances well, i.e. borrow money and pay it back in a timely manner. A negative credit history tells lenders you have a difficult time managing your finances and instead are in debt, often not repaying them as agreed.

Credit reports help you by providing you with your personal financial history. This may include attempts at fraud made by others at your expense or errors made by varying lenders. The report can also provide you with information on good or bad decisions you may have made in the past. By staying up-to-date with your financial history, you can ensure you are making good choices, have the ability to detect if someone is committing identity theft and ensure there are no errors.

In addition, a credit report can explain why you were not approved for a certain loan or line of credit. Even though you had a great or excellent credit score, you still had a negative item or charge back on your credit report, so the financial lender refused to approve you.

You can also see how fast your credit score can be transformed. If you go ahead and start repairing your credit, you can watch how fast negative items can be removed and how fast you will gain points putting your score from bad or below 600 to above 700.

If you are not happy with your current FICO score and/or credit history or find there are errors in the report, you can contact a credit repair company. The credit repair company can boost your credit score, remove negative items and/or dispute errors on your behalf

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What Shows Up When Someone Does a Credit Check?

Every credit reporting agency has its own format and reports your information differently, but all three credit reports for the major bureaus will generally contain the same information. Your report will contain both personal, identifying information which is not a factor in your score calculation, as well as, information used for scoring like payment history, credit utilization, and length of credit, inquires and judgements.

Personal Information That Identifies You

Your personal information like your name, both married and maiden, current and former addresses, your date of birth and employment information will show up on your credit report to identify you. Contrary to popular belief, none of this information is used in your score calculation. This information is updated when you apply for new credit.


Also known as Trade Lines, your accounts are how your lenders report your payment history, balance and account status on your report. This could range from your mortgage, to credit cards, auto and personal loans. The date you opened and closed the account will be present as well.

Inquiries for New Credit

Whenever you apply to a new line of credit, you’re allowing that creditor to pull a copy of your report, known as an inquiry. An Inquiry will drop your credit score a few points every time, and it will stay on your report for two years.

Public Records

“Credit reporting agencies also collect public record information from state and county courts, and information on overdue debt from collection agencies. Public record information includes bankruptcies, foreclosures, suits, wage attachments, liens and judgments.”

What are some things that don’t show on my credit report?

The good news is, there are things that don’t show up on your credit report, which you might have heard otherwise.


Your score does not go down every time you move. While your address history is on your report, it does not affect the calculation of your credit score on any level.

Your Salary

Your Salary is not reported on your credit report and holds no weight in your score calculation. Neither does other forms of income like unemployment, alimony, child support or public assistance. However, if you’re applying for new credit a combination of your salary and credit history could be used to determine if you’re lend-able.

Your Employment Status

Rest easy: Your current employment situation will not show on your report.If you’re unemployed your score won’t go down or up

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The 5 C’s of Business Credit

The 5 C’s of business credit are:

1. Character
2. Capital
3. Capacity
4. Collateral
5. Conditions

Character is all about you. It’s about your personal history, your stability, and how reliable you are. This variable is more subjective than the others, and is one of several reasons it is beneficial to do business with a bank where you have built relationships with the people who work there. In determining your character, the lender may look at your education, your work history, your personal income, and personal credit history.

Again, it’s important to remember that this is one area of business credit where relationships do matter!

Capital is about how much you have invested in your business. Whether you are seeking a bank loan or a loan from a private investor, the lender will want to see that you are heavily invested in your own business. Generally speaking, the more of your personal money that you’ve invested in your business, the better it will look to a potential lender. (After all, if you’re not confident enough to invest in your business, why should they be?)

Capacity is about your ability to repay a loan according to the terms. Things like cash flow, payment history, and the assets and resources of any person providing a personal guarantee will play a part in determining your capacity to pay back a loan. Collateral is something offered up as security for a loan. Anything from equipment to inventory to a home you own can be considered collateral. It may be easier to get approved for loans with collateral, and many loans will require it. In some cases, the more that you can offer as collateral, the more likely you will be to get approved.

“Conditions” may mean any number of things, some of which could be out of your control. The current economy, for instance, may play a role in your ability to get approved for a loan. Other things that they may look at include your industry and its economical status, and the purpose of the loan.

If your industry is suffering and businesses in your industry are struggling, it could negatively affect your ability to get approved. Some loan purposes are more readily approved than others, too. Loans for riskier purposes such as new and unproven expansions are generally less likely to be approved.

When your company can meet these 5 C’s you have a better chance at getting approved.

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