Your Credit
A person’s credit is a record of how they’ve managed their debts. Your credit history is recorded in your credit reports, which also contain additional details about your financial situation. Your credit history can have a significant impact on your financial life, so it is important to establish a positive track record. The following are important aspects of maintaining excellent credit:
- Credit History: Credit history is a record of how a person has managed their debts, including credit card accounts and other loans. It is defined as a record of how you repay debts.
- Credit Report: A credit report is a detailed summary of your credit history, compiled by a credit bureau. It contains information about your credit activity and current credit situation such as loan payment history and the status of your credit accounts.
- Credit Score: A credit score is a three-digit number that rates your creditworthiness. It’s based on your credit history, which includes information like the number of accounts, total levels of debt, repayment history, and other factors. Lenders use credit scores to evaluate your creditworthiness, or the likelihood that you will repay loans in a timely manner.
- Building Credit: Building a credit history is an important step in establishing your financial health, as it impacts various aspects of your life during and after college.
- Identity Theft: Identity theft is a crime where someone uses your personal or financial information without your permission. They might steal your name and address, credit card, or bank account numbers, Social Security number, or medical insurance account numbers. Such stolen personal information is typically used to make unauthorized purchases, open new accounts, apply for loans, or file fraudulent tax returns.
