Determining Your Credit Standing

The term "credit score" usually refers to one's FICO score a scoring formula introduced by the Fair Isaac Credit Organization for assessing credit risk. Different retail and commercial organizations may evaluate your "credit worthiness" using FICO scores from the credit reporting agencies, as well as their own scoring criteria.

Just as your credit history can be different when reported through different agencies, your credit score can also differ at any point in time, since it is based on many different factors:

• Your history of making scheduled payments.
• The amount of outstanding debt you owe.
• The duration of your credit history.
• The number of credit inquiries that have been made.
• The kinds of credit you have been awarded (bank card vs. store-specific cards vs. loans, etc.).

The Fair Credit Reporting Act (FCRA) specifies that one free credit report per year be provided to you by credit reporting agencies and in the following situations:

• If you have reason to believe that your file at a particular credit reporting agency contains inaccurate information due to fraud.
• If you are unemployed (but are attempting to find employment).
• The duration of your credit history.

Additionally, if you are denied credit based on information provided by a credit reporting agency, the FCRA stipulates that you are entitled to receive a free credit report from that agency. However, you must request the report within 60 days of receiving the notice. If you want an accurate picture of the credit history that is being reported about you, you will need to request a copy of your credit history from each of the three major credit reporting agencies. If you do not qualify for a free report, you still may request a copy for free. Remember, when you order a credit report it will not necessarily include your credit score. To find out your credit score, you will need to specifically request the "scoring option" for which there may be an additional fee.