Your credit profile gives a detailed list of your borrowing history. These items have been reported to the reporting agencies by lenders who have extended credit to you.
Since this file report reflects your creditworthiness, you should check it at least yearly. You want to be sure everything is being reported correctly. One way to check this is by seeing what your credit score is.
If your credit score is low, that means you may have some problems in your profile.
You don't have a score. That means you don't have a file with the reporting agencies. You can start a credit profile just by obtaining a credit card.
Why is this important? Let me give you an example. A friend of mine wanted to take advantage of an awesome short sale in her area. When she applied for an FHA mortgage, she found out she didn't have a score. The real estate agent told her she needed to open a credit card account to establish a credit profile.
My friend was upset, she had paid all her financial obligations with cash or a money order. She told the real estate agent what a good bill payer she was. Unfortunately, that couldn't be verified with the reporting agencies. A file needed to be started to show she was a good payer.
The way to get a file established is to apply for credit. That starts the process of reporting. To buy a house you must have this. Lenders need to verify that you are a good bill payer.
If your score is low, then you may want to see the entire report to investigate what is happening.
Your profile shows what types of credit you use, the length of time your accounts have been open, and whether you've paid your bills on time.
It tells lenders how much borrowing you've done and whether you're seeking new sources of credit.
It’s a picture of how you paid back the businesses you have borrowed money from. It also shows how you have met other financial obligations.
Lenders request a copy of this file when you apply for a loan. That's why its good to check your credit.
Have a Question is an excellent opportunity to ask away. So go ahead....pick my brain!
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