What is your credit score? Your credit score is a number that reflects your credit history. It is compiled from several sources mostly from companies with which you have made agreements to make payments. Activities that can create data about your financial activities include renting housing, buying a house, buying a car, even seeking health care. The score is based on information that tells whether or not you pay your bills on time and how much you owe to creditors.
The 3 credit bureaus – Experian, Trans Union, and Equifax keep scores about consumers. They have slightly different score ranges:
Experian- low 320 to high 844
Trans union – low 309 to high 839
Equifax – low 334 – high 818
To be considered a reasonable credit risk, your credit score should be in the range of 600 to 750.
Consumers made no bargain with these companies to keep their credit scores but the scores generated by these companies play a big part in (a) whether or not you get a loan and (b) how much interest you pay for the loan.
Each consumer is entitled to a free annual report from each of the consumer reporting agencies, i.e. Experian, Trans Union, Equifax. You can get the report by
phone – 877-322-8228,
or by mail: get and complete the Annual Credit Report Request Form from the Federal Trade Commission’s website. After you complete the form mail it to Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281.
NOTE: Only one website is authorized to provide free credit reports – annualcreditreport.com. There are some sites that say they offer the free report or a free credit score for free credit monitoring. These sites are offering services that may turn out not to be free. They are not associated with the “legally mandated free annual credit program”. AnnualCreditReport.com will not send you an email requesting your personal information. Be very careful of the spelling as there some URLs that deliberately misspell annualcreditreport.com in the hope that you will end up on their site.
It’s very important to check your credit annually. Sometimes the reporting agencies make mistakes and that can directly affect your ability to obtain a loan. Another reason to check your credit report is to protect against identity theft.
Many people think that their inquiry will affect their credit. Your inquiry, which is a soft inquiry, does not affect your credit. Inquiries (known as hard inquiries) made by lenders affect your credit.
You can learn more about credit reports and your rights under federal law at the Federal Reserve online, and at the Federal Trade Commission’s website, You can also visit the Consumer Financial Protection Bureau for consumer resources; including financial coaching, mortgage information, rulemaking and research data.