Are you lacking in meeting your money milestones?
You need to inform yourself about both the credit scores and credit report as only after the assessment of your credits you will be eligible for lending any money. You might have heard about these two terms – credit score and credit report but do you know what importance they possess and how they are codependent.
Let us take you on a tour to the major differences between the credit score and credit report.
What Is A Credit Score?
The credit score is a term liable for showcasing the lenders about your credits. Further, there is a corporation named Fair Isaac who calculates the credit scores and inform the various lenders about how different companies are performing in terms of credits. The FICO formula is executed to measure the scores and is dependent on some factors that include:
i) Payment History:
It includes all the late payments made by you and what was the frequency of such late payments.
ii) Money Owed:
This is referred to as the total amount of money you possess in all your accounts and how much credit you have in extra. However, no lender would easily provide you the money if your credit utilization ratio is high regardless of how much you can afford.
iii) New Credit:
Applying for money lending after very short intervals can affect your credits as your account will undergo an inquiry further decreasing your credit score because of the period of history.
However, the credit report agencies may give every factor different weightage depending on distinct aspects.
What Is A Credit Report?
While credit scores are liable for displaying your credits but for revealing the detailed information including credit profile numbers, credit reports play a vital role. Credit reports include the history of all the borrowed payments that left the impact on your credit. The world of finance is incomplete without the credit reports as it is liable for recognizing the stolen cases and more.
These are the reasons why you need to know the difference between credit score and credit report. So, if your credit score isn’t good and you want to get eligible for new account credit then visit us at Authorized Users. We focus on updating your credit reports with the authorized user tradelines and boost your credit score.