|
Credit history
An historical record of whether you pay your bills on time or are delinquent. Your credit report reflects your payment history. A delinquent payment is past due 30 days or more.
Credit line pricing
The interest rate charged on a home equity line of credit is usually based on the U.S. commercial prime rate, which is the rate that major U.S. banks charge their best customers. For instance, if a credit line rate is the prime rate plus 2 percentage points, and the prime rate is 8.5%, the credit line annual interest rate is 10.5%.
Credit report
A credit report is a summary of an individual's credit history. It includes loan payment histories, late payments, existence of liens or other encumbrances, debt forgiveness, bankruptcy filings, and number of inquiries by prospective lenders.
Credit score
A credit bureau calculates your credit score and submits it to a lender to assist in making a credit decision. The credit bureau uses software from Fair, Isaac and Co. to calculate the score (as a result, a credit score is also called a FICO score). Your credit score is one determinant of a lender's credit decision. The lender also adheres to loan-approval guidelines that are set by the company itself. Credit scores do not have information on your age, gender, color, religion, marital status, and employment. Other factors, such as your employment history, are also excluded. According to Fair, Isaac and Co., about 20% of FICO scores are in each of the following ranges: below 620, 620-690, 690-745, 745-780, and 780 and above.
|