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FREQUENTLY ASKED QUESTIONS
Understanding your credit is not always easy. We’ve put together some of the most common questions and answers below to help explain the basics. If your question isn’t answered, get in touch with us and we’ll be happy to help.
WHAT IS CREDIT & WHY IS IT IMPORTANT?
WHAT MAKES UP MY CREDIT SCORE?
By design, your credit score comes from the information found on your credit report. If an item doesn’t show up on a credit report, it can’t affect your score.
For example, your bank account balance doesn’t appear on your credit report. Neither does your income or your net worth. None of these factors play a role when a scoring model calculates your credit score.
Factors that do impact your FICO Score fall into one of the following five categories.
Payment History: 35%
Amounts Owed: 30%
Length of Credit History: 15%
New Credit: 10%
Credit Mix: 10%
WHAT INFORMATION IS FOUND ON MY CREDIT REPORTS?
Your credit report information covers four key areas: identifying information, credit accounts, credit inquiries, and information from public records.
WHAT INFORMATION IS NOT ON MY CREDIT REPORTS?
Here are a few things that don’t appear in your credit report or impact your score in any way:
Your race
Your religion
Your national origin
Your marital status
Your gender
Your age (though your birth date appears in your report)
Your salary
Your occupation or employment history
Your level of education
Your criminal record
Your bank account balance
Your shopping habits
HOW DO I OBTAIN A COPY OF MY CREDIT REPORT?
Everyone is entitled to one free credit report per bureau per year by federal law. You can access yours at AnnualCreditReport.com. You’ll have to answer some security questions to verify your identity and then you can view your reports. You have the choice to view all three reports at the same time or to space them out throughout the year.
If you’ve already used your annual free credit reports for the year, you can purchase additional credit reports from the credit bureaus themselves. Some credit monitoring companies may also offer credit reports to customers who sign up for their services.
HOW CAN I IMPROVE MY CREDIT?
There are five main contributors to your credit score–payment history, amount of debt, length of credit history, credit mix and new credit. Managing your credit wisely by paying your bills on time, paying debt down and maintaining your current accounts could improve your score.
Beyond these five factors, your credit could contain negative items that are unfair or inaccurate, which can stay on your reports for up to seven to 10 years. If you don’t want to wait that long, you can try repairing your credit. Learn more about building credit online, or call A1CREDITBUILDERS.com at 404-889-0987 to get signed up today.
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