What is a Credit Report and What is My Credit Score?

Q: I want to file bankruptcy in Georgia. What, exactly, is a credit report and credit score?
A: Bankruptcy attorneys use credit reports as an important tool. As Georgia bankruptcy lawyers we deal with credit scores and credit reports on a daily basis.
Known as a credit file, a credit profile or a credit history, a personal credit report exists to provide details of a consumer's financial behavior. Information on the report is obtained from your creditors, public records and other sources, which report it to credit bureaus (like Trans Union, Equifax & Experian) through an automated process.

Credit reporting agencies keep the information and sell it to others who have a permissible purpose to see it - like mortgage companies, car finance companies, credit car companies, etc. The Federal Trade Commission does not require that the credit reporting agency obtain documentation such as the actual signed sales slips, signature cards, contracts, etc. Basically, credit reporting agencies just use the information provided to them by their corporate members.

What is a Credit Score?

A credit score is an assigned number that they say reflects your credit risk level. A high number is better than a low number. A credit score can change based on a payment history and level of credit outstanding. Miss a few credit card payments (to Visa, American Express, MasterCard, or Capital One) or a couple of mortgage payments (to Wells Fargo, Bank of America) and your score will likely decrease

Why are Credit Scores Used?

Credit scores are used to determine a person's likelihood of meeting their debt obligations, i.e, paying back a loan (to Sun Trust or a credit union), making a car payment (to Ford, General Motors, BMW, Mercedes-Benz, Chrysler, Toyota or Honda).

Who Uses Credit Scores?

Most credit issuers use credit scores - places like credit card companies, auto dealers, retail stores (like Macy's, Nordstrom, The Gap, Wal-Mart, Kohl's, Target, Brooks Brothers, Neiman-Marcus).

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