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 Dear
Dr. Don,
When starting out applying for credit, what is your credit score before you buy anything at all?
-- Heris
 Dear
Heris,
Your credit score is based on the information in your credit
report. A credit report chronicles your identifying information, credit
history, loan applications, public records and any collection items. With
no credit history there's no way to compute a credit score.
This excerpt from the myFICO Web page, "What's
in my credit report?," explains in greater
depth what's in your credit report.
- Identifying Information.
Your name, address, Social Security number, date of birth and employment information
are used to identify you. These factors are not used in scoring. Updates to this
information come from information you supply to lenders. - Trade
Lines.
These are your credit accounts. Lenders report on each account
you have established with them. They report the type of account (bank card, auto
loan, mortgage, etc), the date you opened the account, your credit limit or loan
amount, the account balance and your payment history. - Inquiries.
When you apply for a loan, you authorize your lender to ask for a copy of your
credit report. This is how inquiries appear on your credit report. The inquiries
section contains a list of everyone who accessed your credit report within the
last two years. The report you see lists both "voluntary" inquiries,
spurred by your own requests for credit, and "involuntary" inquires,
such as when lenders order your report so as to make you a preapproved credit
offer in the mail. - Public Record and Collection
Items.
Credit reporting agencies also collect public record information
from state and county courts, and information on overdue debt from collection
agencies. Public record information includes bankruptcies, foreclosures, suits,
wage attachments, liens and judgments. Getting credit without a credit
history isn't easy but you have to start somewhere. An earlier Dr. Don column,
"Right
card can help build credit history," explains how to get started.
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