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Credit report vs credit score: what’s the difference?



The information provided on this website does not, and is not intended to, act as legal, financial or credit advice. See Lexington Law’s editorial disclosure for more information.

When learning about your credit history, you’ll find it’s usually based on two factors: your credit score, which is a number between 300 and 850 used to grade your creditworthiness, and your credit report, which is a documentation of all the factors that make up your credit score. Learning to check and manage both your credit score and your credit report are important parts of maintaining your overall financial health.

chart comparing credit scores vs credit reports

What is a credit score?

Your credit score is a number between 300 and 850 that is used by lenders to grade your creditworthiness, or how good of a candidate you are for an extension of credit (i.e. a loan or credit card).

There are many different scoring models, but the one used most commonly to make credit decisions is the FICO® score. It offers a variety of specialized scores for credit cards, home loans and more. Another relatively common score issuer is VantageScore.

Credit scores are updated monthly and determined based on a variety of factors to predict how likely you are to be a responsible borrower, such as:

  • Your history of late and on-time payments
  • How long you’ve had your credit accounts
  • How much debt you have overall
  • The diversity of your credit accounts (across credit cards, mortgages, student loans, etc.)
  • How much money you owe compared to your credit limits
  • What percentage of your credit limit you’re currently using
  • How many new credit cards or loans you’ve applied for recently

All of these things weigh into one personal three-digit number. While scoring models vary, overall, anything above 800 is considered exceptional, the 740–799 range is considered very good and 670–739 is considered good. Any score below 670 could stand to be improved, and scores below 580 are considered very poor and will severely limit a person’s creditworthiness.

What is a credit report?

Your credit report is a documentation of all the historical factors that are used to calculate your credit score, but it doesn’t include the actual three-digit “grade” assigned to you each month. Credit reports list:

  • Every account you currently hold
  • All of your closed accounts
  • All hard inquiries into your credit
  • A list of both your late and on-time payments
  • A record of any accounts that needed to be sent to a collection agency

There are three credit bureaus that generate credit reports: Experian, TransUnion and Equifax. Annually, you can order one copy of your credit report for free from each bureau. It’s recommended to request these copies one at a time throughout the year and check regularly for any potential errors that could damage your credit and hurt your chances at getting a loan.

 Credit Score vs. Credit Report: What’s the Difference? A credit report shows your borrowing history; this information is then used to generate your credit score. Credit Score: Your credit score is a numerical grade of your creditworthiness at any given time. Credit Report: Your credit report may list every piece of your financial history that affects your creditworthiness.

Who uses credit scores and who uses credit reports?

When applying for a new line of credit, it’s important to know what your lender will be looking at: your credit score or credit report. Generally, here’s who will be looking at what:

  • Both credit report and credit score: Auto lenders, collection agencies, mortgage lenders
  • Only credit score: Credit card companies, landlords (occasionally)
  • Only credit report: Employers, insurers, landlords

No matter whether your lender will be looking at just your credit report or your credit score, it’s recommended to check both your score and report before applying for new credit. This way, you can examine your overall credit health and see if there are any potential issues in the way of you getting approved, or if applying for a new line of credit is a good idea at all.

Do people know the difference between a credit score and a credit report?

It’s important to be informed on what a credit score and credit report are, as well as how to monitor both and report any discrepancies. But how many people are actually getting this essential financial education?

We surveyed over 3,000 people to learn how many people know the key differences between a credit score and a credit report. Here are some key takeaways we found:

  • One in four people don’t know that there is a difference between a credit score and a credit report.
  • Less than 20 percent know how to read their credit report.
  • Seventy percent of people don’t know how long credit history remains on a credit report.

The first survey question asked whether or not there’s a difference between a credit score and a credit report.

  • In a group of over 1,000 respondents, just under 75 percent correctly answered that there is a difference between a credit score and credit report.
  • 83 percent of respondents aged 55 and older answered correctly.
  • 50 percent of respondents ages 18–24 knew the differences between a credit score and credit report.
Is there a difference between a credit score and a credit report? 1 in 4 people incorrectly believe there’s no difference between a credit score and credit report. 75% answered yes, there is a difference, while 25% answered no, there is no difference.

The second of the two survey questions quizzed participants on what is and isn’t true of a credit score or a credit report.

  • Across both surveys, just over 50 percent of respondents answered a majority of the six total choices incorrectly.
  • About 12 percent completed the quiz with one or no mistakes.
Most common credit report/score misconceptions based on survey results. Almost 70% of respondents don’t know how long late payments remain on their credit report; over a quarter believe a credit report also includes a credit score; less than 20% know how to determine if credit is good or bad using their credit report.

How do I access my credit score and credit report?

It’s recommended that you check both your credit report and credit score before applying for new credit, such as a home loan, a new credit card or a student loan. This gives you a chance to see what shape your credit is in and take steps to improve it if necessary.

You can access a free credit report from each of the three national credit bureaus (Experian, Transunion and Equifax) once every 12 months at Once you have your credit reports, carefully check them for accuracy and any factors or accounts that could be hurting your credit score.

Contrary to popular belief, checking your credit scores does not make your score go down. You can access your score each month on a number of different banking websites, including your personal credit card site. Become familiar with your score and look out for any sudden dips that might signal possible negative items.

Whether you need to brush up on the basics of credit or are curious about what differentiates credit scores and reports, taking these steps to secure your financial future is important. Knowing these key differences can help you prepare for a financially healthy future and ensure you have the knowledge and the means to buy a house, take out a student loan or any other situation where your credit is involved.

Reviewed by Kenton Arbon, an Associate Attorney at Lexington Law Firm. Written by Lexington Law.

Kenton Arbon is an Associate Attorney in the Arizona office. Mr. Arbon was born in Bakersfield, California, and grew up in the Northwest. He earned his B.A. in Business Administration, Human Resources Management, while working as an Oregon State Trooper. His interest in the law lead him to relocate to Arizona, attend law school, and graduate from Arizona State College of Law in 2017. Since graduating from law school, Mr. Arbon has worked in multiple compliance domains including anti-money laundering, Medicare Part D, contracts, and debt negotiation. Mr. Arbon is licensed to practice law in Arizona. He is located in the Phoenix office.

Note: Articles have only been reviewed by the indicated attorney, not written by them. The information provided on this website does not, and is not intended to, act as legal, financial or credit advice; instead, it is for general informational purposes only. Use of, and access to, this website or any of the links or resources contained within the site do not create an attorney-client or fiduciary relationship between the reader, user, or browser and website owner, authors, reviewers, contributors, contributing firms, or their respective agents or employers.

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Does Getting Joint Credit Cards Have an Impact on Both Spouses’ Credit?



couples credit history

While marriage can help you improve your financial situation, it does not automatically mean that you and your spouse will share a credit report. Your credit records will remain separate, and any joint accounts or joint loans that you open will appear on both of your reports. While this can be advantageous, it’s critical to remember that joint account activity can effect both of your credit scores positively or negatively, just as separate accounts do.

Users Who Are Authorized

An authorized user is a user who has been added to an existing credit account and has been granted the authority to make purchases. Authorized users are typically issued a card bearing their name, and any purchases made by them will appear on your statement. The primary distinction between an authorized user and a shared account owner is that the account’s original owner is solely responsible for debt repayment. Authorized users, on the other hand, can always opt-out of their authorized status, although the principal joint account owner cannot.

If your credit score is better than your spouse’s as an authorized user, he or she may benefit from a credit score raise upon account addition. This is contingent upon your creditor notifying the credit bureaus of permitted user activity. If your lender does report authorized users, the activity on your account may have an effect on both you and your spouse. However, some lenders report only positive authorized user information, which means that late payment or poor usage may not have a negative effect on someone else’s credit. Consult your lender to determine how authorized users on your account are treated.

Joint Credit Cards Have an Impact on Your Credit Score

Opening a joint credit account or obtaining joint financing binds both of you legally to the debt’s repayment. This is critical to remember if you divorce or separate and your spouse refuses to make payments, even if previously agreed upon. It makes no difference who is “responsible,” the shared duty will result in both partners’ credit histories being badly impacted by late payments. Regardless of changes in relationship status or divorce order, the creditor considers both parties to be liable for the debt until the account is paid in full.

Accounts Individuals

Whether you’re happily married or divorced, you and your spouse may decide to open separate credit accounts. Most creditors will enable you to transfer an account that was previously joint to one of your names if both of you agree. However, if there is a debt on the account, your lender may refuse to remove your spouse’s name unless you can qualify for the same credit on your own. Depending on your financial status, qualifying for financing and credit on a single income may be tough.


While creating the majority of your accounts jointly with your spouse may make it easier to obtain financing (two salaries are preferable to one), reestablishing credit independently following a divorce or separation is not always straightforward. To make matters worse, your spouse may wind up causing significant damage to your credit rating following the separation, either intentionally or through irresponsibility – making the financial situation much more difficult.

Before you rush in and open accounts with your spouse, take some time to discuss the shared responsibility of these accounts and what you and your husband would do in the event of a worst-case situation. These types of financial discussions can be difficult, especially when you rely on items lasting a long time, but a mutual understanding and respect for each other’s credit can go a long way toward keeping your score when sharing an account.

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Credit Cards

Should you pay down debt or save for retirement?



rebuilding credit

While establishing a comprehensive, workable budget is undeniably one of the most important factors in maintaining a healthy financial life, it can also be one of the most difficult. For those who are struggling with personal debt, building a budget can be particularly challenging. When the money coming in has to stretch like a contortionist to cover expenses, it can be hard to determine where to focus — and where to trim.

Sometimes, the battle of the budget can come down to a choice between dealing with the present — and thinking about the future. When your income is running out of stretch, do you pay off your existing debt, or do you start saving for retirement? At the end of the day, the solution to that particular dilemma depends on the type of debt you have and how far you are from retiring.

If you have high-interest debt, pay it down

When considering how to allocate your budget, it’s important to understand the different kinds of debt you may have. Consumer debt can be categorized into two basic types: low-interest debt and high-interest debt, each with its own impact on your credit (and your budget).

In general, low-interest debt consists of long-term or secured loans that carry a single-digit interest rate, such as a mortgage or auto loan. Though no debt is the only real form of good debt, low-interest debt can be useful to carry. For instance, purchasing a home with a low-interest mortgage can actually save you money on housing costs if you do your homework and buy a house well within your price range.

High-interest debt, on the other hand, typically has a hefty double-digit interest rate and shorter loan terms, such as that of a credit card or payday loan. High-interest debt is the most expensive kind of debt to carry from month to month and should always be priority number one when building a budget.

To illustrate why you should focus on high-interest debt above everything else, consider a credit card carrying the average 19% APR and a $10,000 balance. If the balance goes unpaid, that high-interest credit card debt will cost $1,900 a year in interest payments alone. Now, compare that to the stock market’s average annual return of 7%, and it becomes clear that you’ll see significantly more bang for your buck by putting any extra funds into your high-interest debt instead of an investment account.

If you are having trouble paying off your high-interest debt, there may be some steps you can take to make it more manageable. For example, transferring your credit card balances from high-interest cards to ones offering an introductory 0% APR can eliminate interest payments for 12 months or more. While many of the best balance transfer cards won’t charge you an annual fee, they may charge a balance transfer fee, so do your research. You’ll also want to make sure you have a plan to pay off the new card before your introductory period ends.

Most balance transfer offers will require you to have at least fair credit, so if your credit score needs some work, you may not qualify. In this case, refinancing your high-interest debt with a personal loan that has a lower interest rate may be your best bet. Make sure to compare all of the top bad credit loans to find the best interest rate and loan terms.

If you’re nearing retirement, start to save

The closer you get to retirement age, the more important it becomes to ensure you have adequate retirement savings — and the more pressure you may feel to invest every spare penny into your retirement fund. No matter your age, however, paying off your high-interest debt should always remain the priority, as it will always provide the best rate of return (as well as likely provide a credit score boost).

Indeed, no matter how tempting it becomes, you should avoid reallocating money you’ve dedicated to paying off high-interest debt to save for retirement. Instead, the focus should be on re-evaluating your budget to find any additional savings you can. To be successful, you will need to make a strong distinction between want and need — and, perhaps, make some tough lifestyle choices.

Though simply eliminating your daily coffee drink won’t magically provide a solid retirement fund, saving a few bucks by homebrewing while also eliminating a pricey cable bill in favor of an inexpensive streaming service — or, better yet, free library rentals — can add up to big savings over the course of the year. The ideal strategy will involve overhauling every aspect of your lifestyle, combining both large and small cuts to develop a lean budget structured around your long-term goals.

Of course, while you should never allocate debt money to your retirement savings, the reverse is also true. It is almost always a horrible idea to remove money from your retirement account before you hit retirement age — for any reason. Withdrawing early means you will be stuck paying hefty fees for withdrawing money early and, depending on the type of account, you may also have to pay significant taxes.

Aim for both goals by improving income

As you take the necessary steps to pay off debt and save for retirement, you may have already stretched the budget so thin it’s practically transparent. In this case, it is time to consider ways to improve your overall income. Increasing the amount you have coming in not only provides extra savings to put toward your retirement, but may also speed up your journey to becoming debt-free.

The easiest solution may be to look for ways to increase your income through your current job; think about taking on additional shifts or overtime hours to earn some extra cash. Depending on your position — and the time you’ve been with the company — consider asking for a pay raise or promotion, as well.

If you do not have options to make more money at your day job, it may be time to find a second job. Look for opportunities that provide flexible schedules that will accommodate your regular job; many work-from-home positions, for example, can easily fit into most work schedules. Doing neighborhood odd jobs, such as babysitting and dog walking, may also provide a solid income boost without interfering with your existing job.

For some, the need to pay off debt and improve retirement savings can be more than just a source of stress — but a hidden opportunity to begin a new career adventure. Instead of being weighed down by yet more work, use the desire to better your budget as a reason to explore the profit potential of a passion or hobby. Starting a small online store, part-time consulting service, or other small business can be a great way to improve your income and your overall happiness.

While it may sound intimidating, starting a side business can be as simple as putting together a professional looking website and doing a little marketing legwork to spread the word. And no, building a website isn’t as scary — or expensive — as it seems, either. A number of the top website builders now offer simple drag-and-drop interfaces perfect for putting together a professional-looking web page in minutes (without breaking the bank).

Learn how you can start repairing your credit here, and carry on the conversation on our social media platforms. Like and follow us on Facebook and leave us a tweet on Twitter.

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How does a loan default affect my credit?



loan default

Nobody takes out a loan expecting to default on it. Despite their best intentions, people sometimes find themselves struggling to pay off their loans. These types of struggles happen for many reasons, including job loss, significant debt, or a medical or personal crisis.

Making late payments or having a loan fall into default can add pressure to other personal struggles. Before finding yourself in a desperate situation, understanding how a loan default can impact your credit is necessary to avoid negative consequences.

30 days late

Missing one payment can further lower your credit score. If you can pay the past due amount plus applicable late fees, you may be able to mitigate the damage to your credit, if you make all other payments as expected.

The trouble starts when you (1) miss a payment, (2) do not pay it at all, and (3) continue to miss subsequent payments. If those actions happen, the loan falls into default.

More than 30 days late

Payments that are more than 30 days past due can trigger increasingly serious consequences:

  • The loan default may appear on your credit reports. It will likely lower your credit score, which most creditors and lenders use to review credit applications.
  • You may receive phone calls and letters from creditors demanding payment.
  • If you still do not pay, the account could be sent to collections. The debt collector seeks payment from you, sometimes using aggressive measures.

Then, the collection account can remain on your credit report for up to seven years. This action can damage your creditworthiness for future loan or credit card applications. Also, it may be a deciding factor when obtaining basic necessities, such as utilities or a mobile phone.

Other ways a default can hurt you

Hurting your credit score is reason enough to avoid a loan default. Some of the other actions creditors can take to collect payment or claim collateral are also quite serious:

  • If you default on a car loan, the creditor can repossess your car.
  • If you default on a mortgage, you could be forced to foreclose on your home.
  • In some cases, you could be sued for payment and have a court judgment entered against you.
  • You could face bankruptcy.

Any of these additional consequences can plague your credit score for years and hinder your efforts to secure your financial future.

How to avoid a loan default

Your options to avoid a loan default depend upon the type of loan you have and the nature of your personal circumstances. For example:

  • For student loans, research deferment or forbearance options. Both options permit you to temporarily stop making payments or pay a lesser amount per month.
  • For a mortgage, ask the lender if a loan modification is available. Changing the loan from an adjustable rate to a fixed rate, or extend the life of the loan so your monthly payments are smaller.

Generally, you can avoid a loan default by exercising common sense: buy only what you need and can afford, keep a steady job that earns enough income to cover your expenses, and keep the rest of your debts low.

Clean up your credit

The hard reality is that defaulting on a loan is unpleasant. It can negatively affect your credit profile for years. Through patience and perseverance, you can repair the damage to your credit and improve your standing over time.

Consulting with a credit repair law firm can help you address these issues and get your credit back on track. At Lexington Law, we offer a free credit report summary and consultation. Call us today at 1-855-255-0139.

You can also carry on the conversation on our social media platforms. Like and follow us on Facebook and leave us a tweet on Twitter.

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