Credit Reports vs. Credit Scores

By Think Credit Reports

Introduction

Through Think Credit Reports, an Internet-based company, customers can check both their credit reports and their credit scores. Think Credit Reports presents reports and scores from all three credit bureaus.

Although an individual's credit report and credit score are often linked, and even presented in the same document, they are not two terms for the same thing. Simply put, a credit report details a person's borrowing and payment history. This includes information about payments that the person has made to credit card companies as well as reports of rent and utility bills paid.

Credit Report

A credit report also details the types of credit lines that the person uses, new credit recently established, and any balances held or lines of credit available. Additionally, credit reports give information about a person's on-time payment history and whether any payments have gone to a collections agency or to court.

A credit score gives a numerical value to this information. While technically not a part of a credit report, it is generated by the same bureaus, using a detailed mathematical formula.

Conclusion

The most common such formula, known as FICO, calculates a number between 300 and 850, with 700 and higher indicating strong credit. A higher number indicates a lower default risk. Therefore, the higher an individual's credit score, the more likely it is that he or she will receive a line of credit applied for or a desirable interest rate. Bureaus consider all aspects of a person's credit history in calculating this number, although payment history carries the most weight.