Three major credit bureaus — Experian, Equifax, and TransUnion — regularly collect information about your payment history, while your credit report contains additional details regarding your payment history, credit utilization ratio and any open and closed credit accounts.
The information in your credit report is used to calculate a three-digit credit score, which lenders then utilize to evaluate a borrower’s likelihood of defaulting on a loan.
By having a higher score, you’ll typically qualify for loans or credit products with lower interest rates and more favorable terms.
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