Your credit score has a prodigious influence on almost every aspect of your life, and most people are aware of the importance of having a good credit score and the negative impacts of a low rating. Maintaining a good credit score, however, is not as simple as most presume and find themselves on the wrong side of the street. To turn the tables, you need to dig into the details of the credit reporting system and evaluate where you stand.

1. You Might Not Have a Credit Score and thus a Credit Report

Turning 18 doesn’t mean you will automatically have a credit score. In fact, you might not have a credit history if you don’t have a credit card or any other type of loan.

2. There Are Many Credit Reporting Agencies

Most of us believe Equifax, Experian, and TransUnion to be the only three credit reporting agencies. Wrong. There are many more consumer reporting agencies that gather your credit data to help institutions make employment, lending or insurance-related decisions.

3. Credit Report Scores by All the Agencies Aren’t the Same

On average, there are 53 different FICO credit scores, and one out of every five US citizens might get a score that is different from the score being considered by a financial institution to make a decision.

4. Unemployed Individuals Get an Extra Credit Report

Many employers refer to credit reports to screen applicants. That’s the reason why while the three credit agencies provide only one free copy of credit report every year to US citizens; unemployed individuals are entitled to an additional free copy.

5. Credit Report Also Reflects Library Fines and Parking Tickets

A credit report includes the details of all public records, which includes information about public debts to any state body. Avoid neglecting any public library fines or parking tickets that might have been issued in the past, as they lower your credit score. It is important to notify the U.S. Postal service every time you relocate, to ensure that you don’t miss any bills from state or city administration.

6. Late Payments Might Not Show-up

The account delinquency is counted 30 days after the due date. Any payment within 30 days of its due date isn’t reported to any credit bureau. Though it is always a bad idea to pay your bills late; if you missed or failed to pay your bills for any reason, you have a grace period to stop the details from affecting your credit score.

7. Credit Score and Report are Not the Same

While many people are of the opinion that credit scores and credit reports are the same, the notion is simply false. A credit report provides details about your credit history, such as your personal information, detailed account information, and inquiries on your credit history. A credit score, on the other hand, is a number that is calculated by financial institutions in order to check your creditworthiness.

Most of us have a long way to go when it comes to understanding finances, credits, and credit reports. The more you know about it, the better you are at improving the credit score and getting the most benefit out of it. To learn more about credit reports and what to do if you have a low score, feel free to contact us for free expert consultation.