Credit history or credit report

Credit history or credit report is a record of an individual’s or company’s past borrowing and repaying, including information about late payments and bankruptcy. The term “credit reputation” can either be used synonymous to credit history or to credit score.

When you fill out an application for credit from a bank, store or credit card company, your information is forwarded to a credit bureau, along with constant updates on the status of your credit accounts, address or any other changes you may have made since the last time you applied for any credit.

This information is used by lenders such as credit card companies to determine an individual’s or entity’s credit worthiness; that is, determining an individual’s or entity’s means and willingness to repay an indebtedness. This helps determine whether to extend credit, and on what terms. With the adoption of risk based pricing on almost all lending in the financial services industry, this report has become even more important since it is usually the sole element used to choose the APR (annual percentage rate).

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