What is car financing and how does it work?
Understanding Credit Reports
Your credit report shows new potential lenders how you manage your credit and lists what type of credit you have been applying for. Your credit report shows whether you have begun an account with any lenders, the length of time your accounts have been open, and whether you have paid your bills on time.
Potential creditors, such as automotive companies (like us), review your credit report to decide the potential risk of you failing to repay the credit. Your score is a number that summarizes your risk level. Credit scores help us determine who qualifies for a loan and at what interest rates/terms. Some factors that may make up your credit score and determine your access to credit are:
- Payment History
- Amount of Debt
- Length of Credit
- New Debt
- Type of Credit
Generally, items that are harmful to your credit will stay on your credit report for 6 years, depending on which credit agency is being used to check your credit profile. You should check your credit report at least once a year to make sure all of the information is accurate.