Credit Report Terminology

Credit risk

This the likelihood that an individual will pay his or her credit obligations as agreed. Borrowers who are more likely to pay as agreed pose less risk to creditors and lenders. See Credit Score, FICO and Application Scoring

Credit score

This term is often used to refer to credit bureau risk scores. It broadly refers to a number generated by a statistical model which is used to objectively evaluate information that pertains to making a credit decision. Each credit bureau generates a different credit score using proprietary scoring models. See FICO.

Debt-to-available-credit ratio:

The amount of money a person has in outstanding debt, compared to the amount of credit available on all of the individual's credit cards and credit lines. The higher a person's debt to available credit, the more risky the individual appears to potential lenders.


A failure to make a loan or debt payment when due. Usually an account is considered to be “in default” after being delinquent for several consecutive 30-day billing cycles.


A failure to deliver even the minimum payment on a loan or debt payment on or before the time agreed. Accounts are often referred to as 30, 60, 90 or 120 days delinquent because most lenders have monthly payment cycles.


One of the three major credit-reporting agencies.


One of the three major credit-reporting agencies.

Fair Credit Reporting Act (FCRA)

Federal legislation that promotes the accuracy, confidentiality and proper use of information in the files of every “consumer reporting agency”. The FCRA was enacted in 1970.

FICO scores

The most commonly used credit score. The name comes from the Fair Isaac Corporation, which developed the scoring model. They are used to predict the likelihood that a person will pay his or her debts. The scores use only information from credit reports.

Hard inquiry

Hard inquiries are an item on a person’s credit report which are requests that result from a person applying for credit, such as a mortgage, a car loan, a credit card or a rental application. They are included in the formula for determining a person's credit score.

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