Understand your credit report the way lenders examine it.
Your credit score is one piece of a lending decision. Explore how scoring works, what to verify in your reports, and why lenders examine more than the number.
Start with the model, bureau and date beside your score. FICO groups traditional scoring factors into five categories. These percentages describe their relative importance for the general population; the effect on your own score can differ. Other scoring models may weigh information differently.
35% Payment history
Do the reported payment dates agree with your statements? One recent late payment and an older series of late payments can tell different stories. Compare by month before you dispute.
30% Amounts owed
A reported $600 card balance against a $2,000 limit uses 30% of that limit. A lower reported balance reduces this ratio if the limit stays the same. No fixed ratio guarantees a particular score.
The age of your oldest account, newest account and accounts on average can matter. Compare opening dates on reports, especially after a loan transfer.
10% Credit mix
Revolving accounts, such as credit cards, work differently from installment loans. You do not need to borrow money solely to add a type of credit.
10% New credit
Recently opened accounts and qualifying applications can affect this category. Checking your own report is a soft inquiry and does not reduce your FICO score.
Open an entry to compare the reporting period, potential impact and documents that can help you check it. Reporting periods are general rules; federal exceptions, state rules and individual bureau practices can differ. The reporting clock is separate from a deadline to sue over a debt.
30-day late payment
What it means
A payment reported at least 30 days past due.
Typical reporting period
Generally up to seven years.
Why it matters
A recent missed payment can affect the payment-history part of a score.
What to verify
Compare the due date with the date the lender credited the payment.
If you spot an error
Send the statement, payment confirmation and account ledger showing when payment was received.
The creditor recorded a debt as a loss; that alone does not cancel the debt.
Typical reporting period
Typically around seven years from the original delinquency. For covered accounts, the federal seven-year clock starts 180 days after the delinquency leading to charge-off.
Why it matters
An unresolved loss may affect a score or a lender's review.
What to verify
Verify the first delinquency that was never cured, balance, sale or settlement status.
If you spot an error
Attach statements, a settlement letter or a sale notice. Identify the specific incorrect field.
A creditor or collector is seeking payment on a past-due obligation.
Typical reporting period
Usually around seven years from the delinquency leading to collection; federal rules for covered accounts allow seven years plus 180 days. Sale does not restart this reporting clock.
Why it matters
Treatment can differ by scoring version, debt type and payment status.
What to verify
Check the original creditor, collector, account identity, amount and delinquency date.
If you spot an error
Attach an itemized bill, payment receipt or correspondence tying the error to that account.
A record of a qualifying credit check, often linked to a credit application.
Typical reporting period
Usually visible for up to two years; FICO generally considers the last 12 months.
Why it matters
Recent applications may affect some scores. Your own report check does not affect them.
What to verify
Check the requester, date and related application, including dealer-arranged financing.
If you spot an error
Ask the named company to identify the application or permissible purpose, and dispute a specific error with evidence.
Before you send a dispute
Get the report that shows the suspected error. Compare the exact field against the source document for the same reporting date.
Write down what it says, why you believe it is inaccurate and what correction your evidence supports. Keep the originals and attach copies.
Send the dispute to the reporting company and the business that supplied the information. Keep confirmation, dates, a copy of the dispute and the response.
Review the written result against your original question. If it still does not address the evidence, identify the remaining issue before you decide on a next step.
A bureau generally has 30 days to investigate a dispute; some circumstances allow up to 45 days. The results notice is generally due within five business days after the investigation is complete. You can request a description of the procedure used; the bureau generally must provide it within 15 days after it receives that request. A verification result alone does not prove that the bureau broke the law.
You have a 720 credit score. So why did the lender say no?
A score summarizes some of the information in a credit file. It does not show whether this month’s income covers a proposed payment. A decision can depend on the product, the lender’s standards, the score version and documents outside the credit report.
Mortgage underwriting
A mortgage lender may review employment, income, assets, housing payments, unresolved obligations and credit history. Monthly debt payments divided by gross monthly income give the debt-to-income ratio. Program rules and a lender’s additional standards can both affect a decision.
Automotive financing
An auto lender may use an industry-specific score and examine prior auto payments. Income, existing debts, the down payment, the vehicle value and the loan term also affect the proposed transaction. Two applicants with similar scores can receive different terms.
Apartment and rental applications
A landlord may use a tenant-screening file that differs from your nationwide credit reports. Ask which screening company supplied the report. Check rental history, landlord collections and court outcomes against your own records.
Business lending
A lender may ask how long the business has operated and whether cash coming in can cover its current obligations plus the new payment. Business statements, tax returns and, for some products, a personal guarantee may matter even when the owner has strong personal credit.
The score is one part of your story. Understand the entire file.
