Credit score & Credit

Study

Credit report

A record of your credit accounts payment history.

Credit score

A 3-digit number estimating credit risk.

Payment history

On-time vs late payments; biggest factor.

Credit utilization

balance/limit — keep below 30%

APR — Annual cost of borrowing.

Hard inquiry

Credit check after application (can lower score temporarily).

Soft inquiry

Checks that don’t affect your score

Secured card

Card backed by a deposit; good for building credit.

Delinquent

when you are behind on payments (30, 60 or 90 days)

Collateral

An asset (like a car or house) that a lender can take if you don't pay.

Dispute

A formal request to a credit bureau to fix an error on your report.

FICO

Fair Isaac corporation

vantage

vantage score solution

FICO & Vantage score

both are 3-digit numbers used to predict how likely you are to pay back a loan, FICO and VantageScore are created by different companies using slightly different "math."

FICO Score

• Used by 90% of top lenders

• Focus heavily on your behavior over a long period of time

• To a FICO score you must have an account open for at least 6 months

Vantage Score

Used by free credit-checking apps (credit karma)

Can generates a score after only 1 month