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  • Writer's pictureNate Jefferson

Credit Report: The Adult report card

Updated: Feb 6, 2021

Everyone knows how important your report card can be to signify your academic success, but do you know about the adult report card that can prevent you from receiving a loan, getting an apartment, and even prevent you from getting a job? This adult report card is a credit report, and it’s vital that you learn about its importance.

Just like your high school report card helped colleges decide whether your grades showed that you were a good fit for their program, lenders use your credit report to determine whether or not you’re a good borrower to work with. Your credit report is created by credit bureaus that collect and store financial data about you. This data is submitted to them by creditors, such as lenders, credit card companies, and other financial companies.

From the information that is submitted, credit bureaus give you a score that represents how well you are believed to pay your bills on time. The most commonly used credit score is your FICO Score. This score is generated by the three major credit bureaus: Experian, TransUnion, and Equifax.

Your credit score will range from 350 to 850. That credit score is based on 5 primary factors. Each factor makes up a percentage of what your score is based on. They are:

· Payment history – 35%

· Amount owed – 30%

· Length of credit history – 15%

· New credit – 10%

· Types of credit used – 10%

Creditors typically view a credit score between the range of 670 – 739 as a good score. It is possible that when you first start building credit, your initial score is 300. So, how do you change your score you ask? Well, stay tuned to a future article where I’ll discuss ways you can build your credit score to help ensure your financial success.


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