If you are new to the world of credit, you may have heard of the terms credit score and credit report.
Although they are often used interchangeably, they are not the same thing.
Credit Report vs. Credit Score Differences
A credit report is simply a detailed record of a person’s credit history.
A credit report contains the records of a consumers credit-based history.
A person’s credit report will show the past and current credit accounts, any debts, records, hard or soft credit checks done by lenders, and payment history, just to name a few.
These credit reports are generated by the three major credit bureaus – Equifax, TransUnion, and Experian.
Each one of these three bureaus will hold one credit report per person.
This means that you have a total of three credit reports available to you from each of the three major credit bureaus.
By law, you are entitled to receive a credit report for free each year from each of the three major bureaus.
This means that you have a total of three free credit reports you can view per year, one from each major credit bureau.
A credit score is much different than a credit report.
A credit score is simply a three digit number that measures a consumers creditworthiness based on their credit reports.
A credit score can range from 300 to 850 points. The lower your score, the more risk you pose to a lender in terms of default.
The higher your credit score, the lower your interest rates will be.
Credit scores can be viewed as an overall “summary” of your credit report.
FICO and VantageScore
Two companies produce credit scores: FICO and VantageScore. You will also have a credit score from each of the three major credit bureaus.
While the credit bureaus provide the data to make your credit score, FICO and VantageScore take that information and plug it into their proprietary equations to produce your credit score.
Your credit scores may be slightly different since your credit reports are also all different.
Not all credit bureaus have all your data, so sometimes a negative entry can be on one credit report while not on the other.
Nearly 90 percent of all lenders use the FICO credit scoring model when deciding to provide a line of credit.
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