Credit History

Your credit history affects the fees and interest rates you will be expected to pay when you take out a private student loan, auto loan or mortgage. Landlords may check your credit when you rent an apartment, and 30% of employers now run credit checks during the hiring process!

Credit reports

A credit report is a record of your credit history. It includes personal information, credit accounts, bills in collections, public records and a list of credit inquiries. Credit bureaus collect, organize and store this information in your credit report. That information is then made available to lenders, landlords and other parties that you authorize to access your report.

The three largest credit bureaus are Experian, TransUnion and Equifax. You are eligible to access your credit report for free from each of these institutions once per year.

To access your credit report, visit annualcreditreport.com.

Accessing your credit report will not impact your credit score.

As you review your credit report, you should look for any incorrect information. Errors on your report may mean your identity has been stolen. College students are often targeted for identity theft because they have limited credit history and rarely review their credit reports. If you see an error on your report, you should contact the reporting agency to dispute the information. Check out our page on identity theft. 

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Credit Scores

Your credit score is a single number which represents your credit worthiness. It is not included on your credit report. While there are multiple versions of the credit score, the most common is the FICO credit score.

FICO scores range from 300 to 850 and are determined based on information from your credit report. High scores are better and indicate to lenders that you are likely to make your payments on time and in full.

Many banks and credit card companies will provide credit scores to their members for free.

Credit Cards

Credit cards are one of the most widely used forms of credit. A credit card allows you to borrow money in real time, up to a predetermined limit. Responsible credit card use can be a great way to build credit history and boost your score.

While there are many positives to credit cards, they can also cause problems if you are not well informed. Your credit card limit is not additional income. Every time you pay for something on a card, you are responsible for paying it back. If you do not pay off your balance each month, you will be responsible for that value PLUS interest.

Beginning Balance: Financial Literacy (Credit Scores)

• Understand interest and fees — Annual percentage rate (APR) is the interest rate you will be charged if you carry a balance from month to month. Many credit cards also have other fees. These may include late fees, foreign transaction fees, over the limit fees or annual fees. Always compare a few cards before deciding to open an account.
• Make on-time payments, every time — Paying on time allows you to avoid late fees or negative credit effects. A late or missed payment stays on your credit report for seven years!
• Don’t carry a balance from month to month — You can avoid interest by paying your full balance each month.
• Start small — Keep your credit utilization low and build a habit of responsible credit use by putting small regular charges, like utilities or gas, on your card.

Start your Credit Search with Ease – NerdWallet
Intro to Credit Cards: A College Student’s Guide – Credit Cards Explained

Credit Card Payoff Calculator - Experian

These recommendations are being provided for informational purposes only; they do not constitute an endorsement or approval by the University of Missouri-Kansas City. The University of Missouri-Kansas City bears no responsibility for the accuracy, legality or content of the resources listed.