A credit report is a comprehensive record that shows past credit management and helps potential lenders evaluate your creditworthiness. Credit applications can lead to lenders requesting this report from one or several consumer reporting agencies (Experian®, Equifax®, and TransUnion®) as they gauge the potential risk of lending to you.
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What do lenders see in your credit report?
This report offers an extensive overview of your credit history, including personal data and a rundown of both past and present credit accounts. It documents every credit report request by lenders and any debt collections. Public financial records like bankruptcies and foreclosures are also present.
Accessing your credit report
You are entitled to one free report from each of the big three credit bureaus—Equifax®, Experian®, and TransUnion®—annually via AnnualCreditReport.com or by calling 1-877-322-8228 toll-free. You have a right to a free report if you’ve been denied credit within the past 60 days, are unemployed and plan to seek employment within 60 days, are on welfare, or believe your report has errors.
Reviewing reports from all three agencies is wise as they may have varying data or mistakes. If you find inaccuracies, initiating a dispute with the corresponding agency is necessary.
Understanding what a credit score represents
A credit score is a numerical summary derived from your credit report, reflecting your reliability as a borrower. Often termed as credit ratings or FICO® Scores (by the Fair Isaac Corporation), they range between 300 to 850.
- The breakdown of a FICO® Score is as follows:
- Payment history accounts for 35%
- Amounts owed make up 30%
- Length of credit history comes in at 15%
- Types of credit in use are 10%
- New credit inquiries also take up 10%
Lenders analyze your credit score to decide on your credit risk. A higher score suggests a lower risk to the lender. For a deeper understanding, refer to the information on how credit scores are calculated.
Extra Tip: Wells Fargo provides eligible customers with free access to their FICO® Score plus other resources, such as financial tips and tools. Find out how to access your FICO Score and learn more about these offerings.
