Bad Credit » Understanding Credit

Understanding Credit

How is Your Credit Reputation?

If you are like most people, your personal reputation is important to you.  Maybe you want people to think of you as honest, or reliable.  Or maybe you have worked on creating a reputation of being fearless or smart.  How do you develop these reputations?  You do it through your actions.  You can’t just tell your friends: “I’m reliable”.  You need to do things – like show up on time, help friends when they are in a bind… Your actions cause people to view you in a certain way. 

Well, like it or not, you also have a credit reputation.  And your reputation is based on your actions (otherwise known as your “credit history”).
People who have a good credit reputation have access to credit.  That is, bankers and other companies will happily do business with folks with a good credit reputation, whether it is by giving a loan with good interest rates, providing lower insurance rates, or renting a house or apartment.
Your credit reputation is known as your “credit history”.  You (and potential lenders and other businesses you want to get services from) can see your credit history by getting a “credit report” from one of the major credit bureaus.