Your credit profile — also known as your credit report — can impact whether you’re approved for new credit cards or loans, and at what terms. It could even be a factor in where you can rent a house or apartment or, in some industries, find a job. For these reasons, it’s clear that your credit profile has a significant influence in your life.

Here’s a look at what credit profiles are, what they include, and a few simple ways to make sure yours is in tip-top shape.

Why Do I Have a Credit Profile?

If your name is associated with a credit-based financial product like a credit card, loan, or an account with credit terms like a utility bill or rental agreement, the lender may report monthly account activity to the credit bureaus. As a result, you have a credit profile.

While many people do not have a credit profile until they turn 18 years old and open their first credit card (or a similar account that reports to the credit bureaus), you could have a profile before then if you’re an authorized user on a parent or guardian’s credit account.

What is the Purpose of a Credit Profile?

The type of credit profiles that are used today didn’t exist until Congress passed the Fair Credit Reporting Act (FCRA) to standardize credit reporting in 1970. Prior to that time, creditors didn’t have a formal process for how they were to exchange information about customer credit use with other lenders. The FCRA also added certain protections for consumers.

Essentially, credit profiles are based on the notion that “past performance predicts future behavior.” For example, the information in a consumer’s credit profile can show a lender whether a potential customer consistently pays bills on time and as agreed, and how much of their credit they rely on each month. For consumers, credit profiles can represent their financial responsibility, and indicate that they should be able to access credit that’s offered at competitive rates and on reasonable terms.

Where Can I See My Credit Profile?

By federal law, you’re entitled to access complimentary copies of your credit profile(s) at once a year. Because three major national credit bureaus (TransUnion, Experian and Equifax) build and manage credit profiles, you actually have three different credit reports. You can pull them all at once, or individually, to monitor your credit profile.

What are Important Components of a Credit Profile?

Many factors can impact your credit profile, but there are a few pieces of information that most influence it, and in turn, your credit score:

  • Payment history. This is a critical component of how your credit score is calculated, according to Make sure you pay at least the minimum amount owed on all credit card and loan accounts by the payment due date each month. Should you accidentally miss a payment due date, contact the credit issuer and make the payment as soon as you realize your error.
  • Manage how much you charge. The relationship of how much you owe to how much total credit is available to you is your credit utilization ratio. Generally, all else being equal, the less of your credit line(s) you use, the better your credit profile (and score).
  • Prioritize your oldest cards. The length of your credit history also impacts your credit score. Keep your oldest accounts open and in good standing.
  • Credit Mix. Ideally, your credit profile should contain a mix of revolving accounts, like a credit card and installment accounts that have a fixed monthly payment, like a mortgage or auto loan.
  • Don’t apply for too many credit accounts too fast. If you apply for new credit too often, it could make you appear to be a risky borrower who is overly reliant on credit.

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