What is a Credit Report?

Your credit report, to be a simple as possible, is nothing more than a history of credits and debts including current and expired. Just like in school, this report is graded, the higher the grade, the better you are at finance is what it says to possible lenders and credit card agencies. Even if you are a couple days late on one monthly payment last year, if the lending institution reported it, it will reflect on your score.

Not only does this report include direct bank loans, but it also includes utility payments, hospital bills and more. It is this credit report that is used by any lending institution, including credit card companies, to determine if you are eligible for a credit card, and if so, how much they are willing to entrust with you.

In the credit report, you can be one of three possible applicants, first off, you could be a first timer, meaning you have never used your credit for anything and it is, in some cases, just as bad as having bad credit. One of the best ways to improve your credit rating right off the back, is to get a credit card and just use it for your gasoline purchases, then pay it off fully every month. After a while, your score will increase drastically as long as you pay on time, every time.

Not only is your credit report important, but you will also notice that the application for a credit card asks you about your rent and income as well. They do this to ensure that you are not living beyond your means. Depending on your monthly income versus expenses, they can determine if you are in control of your debt or not.

Your credit report can also be affected if you move around too much. If you are constantly changing your address, then chances are your credit score will fall much faster than you can raise it even with a credit card.

No matter whom you are or what type of credit you are looking for, it is important to maintain a good credit score. A credit card is considered by many as the easiest way to maintain your credit rating. A simple application to a credit card company and soon you just may have a new credit card from which you can use to make small purchases to pay off at the end of the month, doing this on time over several months, and you will soon realize that your rating is increasing and that is a good thing for anyone.

Just remember, that you have to maintain your credit rating and the easiest way top do this is with a credit card which most people can afford without living above their means.

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