Comparison: Credit Report vs Credit Score

 

I’ve often heard people talk about credit report and credit score interchangeably. But, based on what you’ve told me, I think they are different, aren’t they?

That’s right, they are related, but quite different. Your credit report contains information about your financial history and behavior, whereas your credit score summarizes these details into a single number.

What is more important: credit report or credit score?

Both are important. You credit report has details about your loans, repayment history, etc. which helps someone who needs to perform a thorough analysis of your financial behavior. In a way, the credit report is like your school report card. Your credit score is derived from the information in your credit report, and gives a quick snapshot of your creditworthiness to someone who doesn’t need too much information. So the credit score is more like your grade or GPA.

Who looks at my credit report, and who uses my credit score?

Employers and landlords typically look at your credit report, whereas credit card companies – where an approval decision is usually made in just a few seconds – look at your credit score. Mortgage providers and other lenders usually look at both the credit report, and credit score.

Can I see my credit report and credit score?

Yes, you can. But how to do that is a topic for another time…

11 Key Personal Finance Concepts You Must Know for Financial Success

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