ACCC Takes the Mystery Out of Credit Reports

During Credit Education Month, the non-profit ACCC offers Americans the advice they need in order to understand their credit reports.

Boston, MA – March 6, 2015

How to understand your credit report and credit scoreConsumers can take better control of their financial lives by getting a better understanding of their credit report and scores during National Credit Education Month. American Consumer Credit Counseling – a non-profit credit counseling agency that serves consumers nationwide – says many people don’t fully understand the difference between a credit report and a credit score. And they don’t recognize all the ways these tools can be used.

“Often times, individuals are unaware of the impact their credit report and score can have,” said Steve Trumble, President and CEO of American Consumer Credit Counseling ( “Not only can it affect your ability to get credit, but it can also affect your ability to get a job or rent an apartment.”

A credit report is a detailed history of everything that has been done with credit, while a credit score is a mathematical grade or representation of the information in one’s credit report. Credit scores are used by financial institutions, landlords, insurers, and others to assign a certain level of risk to an individual’s ability to meet financial obligations.

Each person is entitled to one free credit report from each of the three reporting agencies, which include Experian, Equifax and Trans Union. This credit report will include a list of every line of credit and loan that one has had, as well as the payment history on those accounts. The report will also show personal information such as past and present addresses, employment history and social security number.

A lender’s perspective is based on a consumer’s credit history. If a person has a positive credit history then they are considered to be low-risk, but if a person has a negative credit history then they are seen as high-risk. If there is information on the credit report that does not seem accurate and negatively impacts the credit score, then it is important to contact the credit reporting agencies to dispute the error.

When calculating a credit score, the most common scoring system is called the FICO score, where the credit score ranges from 300 to 850. Based on this scoring system, the higher the score the lower the risk. If an individual has a lower FICO score, then they will have a higher interest rate which would lead to a higher monthly payment.

March is National Credit Education Month – an ideal time to get smart when it comes to determining your credit score.  American Consumer Credit Counseling has provided the five variables in which credit score is calculated:

  1. Payment history (35%) – The timely manner in which a consumer did or did not repay the debt. This includes all types of credit accounts, late or missed payments, and public records and collection items.
  2. Amounts owed on credit accounts (30%) – The total dollar amount of debt currently owed. For credit cards, this means the total amount owed across all accounts in relation to the total credit limit. When a high percentage of the credit limit is already used, this can indicate overextension and a greater likelihood of future missed payments. Keeping credit card balances well below the limits can help this part of the score.
  3. Length of credit history (15%) – The amount of time the consumer has held credit accounts. This includes how long ago your accounts were established. A longer history helps your credit score.
  4. New credit (10%) – An established credit history without too many accounts is important. Opening several accounts in a short period can indicate greater risk.
  5. Types of credit (10%) – Mix different types of credit including retail accounts, mortgage loans, credit cards, etc.

To correct an error, American Consumer Credit Counseling advises consumers to file a dispute by contacting the credit reporting agency. Once a dispute is submitted, it can take up to 30 days for the agency to investigate and respond.

ACCC provides free credit counseling, bankruptcy counseling, and housing counseling to consumers nationwide in need of financial literacy education and money management. For more information, contact ACCC:

  • For credit counseling, call 800-769-3571
  • For bankruptcy counseling, call 866-826-6924
  • For housing counseling, call 866-826-7180
  • For information on financial education workshops in New England, call 800-769-3571 x1980
  • Or visit us online at

About American Consumer Credit Counseling

American Consumer Credit Counseling (ACCC) is a nonprofit credit counseling 501(c)(3) organization dedicated to empowering consumers to achieve financial management and debt relief through education, credit counseling, and debt management solutions. In order to help consumers reach their goal of debt relief, ACCC provides a range of free consumer personal finance resources on a variety of topics including budgeting, credit and debt management, student loans, homeownership, identity theft,  senior living and retirement. Consumers can use ACCC’s worksheets, videos, calculators, and blog articles to make the best possible decisions regarding their financial future. ACCC holds an A+ rating with the Better Business Bureau and is a member of the Association of Independent Consumer Credit Counseling Agencies. For more information or to access free financial education resources, log on to or visit