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Credit bureaus build, maintain and update credit file databases with billions of pieces of information. Generally, your information will be added to the bureau's credit file by another company, such as a lender, credit card issuer or collection agency. Once your information is in a bureau's credit file, the bureau can create your credit report and your credit report can be scored.
What Is a Consumer Credit File?
A consumer credit file sometimes gets confused with a consumer credit report, but technically the two are different.
A credit file refers to the information that one of the three major consumer credit bureaus (Experian, TransUnion or Equifax) has about you within its database. It may include, for example, information you supplied when applying for a credit card, as the credit card company may send the information from your application to the bureau. Your name, address and Social Security number from the application may be added to the file.
If you're approved for the credit card, the card issuer will also report your card account's information (such as when the account was opened and your credit limit) as well as the timeliness of your monthly payments. Your credit file may also include information regarding your recent applications for new credit, certain public records and records of any accounts in collections.
A credit report, on the other hand, is the information in your credit file organized in a way that's consumable by the party requesting it, whether that's you or a potential lender. Not everything in your credit file ends up on your credit report. Records of most late debt payments, for instance, shouldn't appear on your credit report if they're more than 7 years old.
Your credit report is used to generate your credit scores and may be viewed by lenders to assess your creditworthiness. You can request a free copy of your credit report from all three credit bureaus through AnnualCreditReport.com.
Neither your credit report nor your credit file contains information about your employment status, income or assets, even if you've provided that information on an application for credit.
In credit-world speak, the companies that send information to credit bureaus are called data furnishers, and the accounts that appear in your credit file are called tradelines.
When Does Your Credit Report Start?
You're not assigned a credit report at a certain age or given one at birth. You'll first have to have a credit file with a credit bureau. Then, when your credit report is requested, the bureau will look through its database to find information related to you and compile it to create your credit report.
Because creditors may not report to all three bureaus equally, your credit report may look different depending on the bureau providing it. It also may differ depending on who requested it. For instance, when you request a copy of your credit report, you'll see a list of your recent hard and soft inquiries. But a lender may get a copy that only has hard inquiries.
If a credit file exists for a minor, credit bureaus might not disclose the information about them in their databases. Parents sometimes add their children as authorized users on credit cards, and the credit card issuer may report the account to the credit bureaus under the child's name. But if a creditor requested the child's credit report, Experian would respond saying it won't provide the information because the credit history is associated with a minor.
A parent, legal guardian or the minor themselves (once they're 14) can request a minor's credit report. Once the child turns 18, Experian will share their credit history, and the authorized user account could help the child's credit.
What Does Your Credit Score Start At?
Your credit score doesn't necessarily have a specific starting point. In fact, you may not have a credit score at all.
Credit scoring companies, such as FICO® and VantageScore®, create mathematical credit scoring models that analyze the information in your consumer credit file to determine your credit scores. When someone requests your credit report, they can also request a credit score based on that same information.
The resulting credit score can depend on which credit bureau the credit report is coming from and which credit scoring model is analyzing the report. You may get hundreds of different scores based on the variations.
You also might not be scoreable if you've never had your information sent to the credit bureaus, or you don't have any recent activity in your accounts.
- For FICO® credit scores, you need to have an account that's at least six months old in your credit file. You also need to have an account that's been updated in the past six months—which could be the same or a different account.
- VantageScore credit scores have a lower threshold, and you may be scoreable if you have an account that's fewer than six months old. Or, if you have older accounts and no recent activity.
You can get a FICO® Score☉ for free based on your information in the Experian credit file.
How to Start Building Credit
If you're not currently scoreable or you want to improve your score, you can take a few simple steps:
- Open an account that will be reported to the credit bureaus. Many people start with a student loan, as an authorized user on someone else's credit card, with a credit-builder loan or a secured credit card.
- Make your payments on time. Having your information in a bureau's credit file doesn't necessarily mean you'll get a good credit score. Your payment history is the most important factor in your credit scores, so make sure you make at least your minimum payments on time to avoid hurting your credit. This is also true of accounts that don't get reported to the credit bureaus, as your account could be sold to a collection agency that can report your nonpayment to the bureaus.
Those are the two basic steps to start. As you learn more about how to build credit, you'll uncover how factors in addition to your payment history can impact your scores.
Monitor Your Credit
Keeping an eye on your credit reports is important. Tracking your progress can help you stay motivated as you establish and build your credit. Experian offers free access to your Experian credit report and free credit monitoring, with notifications if there's a suspicious change in your report.
You'll also be notified when there's a significant change in your credit report, such as a new account being added. An unexpected change may indicate your identity was stolen, and you'll want to act quickly to close the fraudulent account and get your credit in order.
With Experian IdentityWorksSM, you can monitor your three credit reports, lock and unlock your Experian report, and get up to $1 million in identity theft insurance.