What is a credit score?
A credit score is a number produced by a mathematical model to predict how
likely you are to repay borrowed money. Most scores range from 300 to 850.
A higher score generally means more approvals and lower interest rates —
which over the life of a mortgage or auto loan can be worth a great deal of money.
What affects your score?
Payment history, how much of your available credit you're using, the age of
your accounts, the mix of account types, and recent inquiries. Your three
bureau reports frequently do not match each other, because creditors don't
all report to all three.
The FTC's 2012 report to Congress under Section 319 of the FACT Act found that
one in five consumers had an error on at least one of their three
credit reports. That is the gap our work addresses.
How long do items stay on file?
- Late payments (30–180 days): seven years from the original delinquency date.
- Collection accounts: seven years from the original delinquency that led to the collection.
- Charge-offs: seven years from the original delinquency, even if paid later.
- Chapter 7, 11, and 12 bankruptcy: ten years from the filing date.
- Chapter 13 bankruptcy: seven years from the filing date.
- Judgments: seven years from the date filed.
- Unpaid tax liens: up to fifteen years; paid liens, ten years from payment.
- Inquiries: generally two years.
What you can do right now, free
- Pay every bill on time — payment history carries the most weight.
- Keep balances under about 30% of each card's limit.
- Keep old accounts open; account age helps you.
- Check all three reports at least once a year at annualcreditreport.com.
- Dispute anything inaccurate. You have the legal right to do this yourself at no cost.
What cannot appear on a credit report
- Medical information, unless you consent.
- Bankruptcies more than ten years old.
- Most other negative debts more than seven years old.
- Your age, marital status, or race, when the report is requested by an employer.