Build a Solid Credit History

By establishing good credit, you'll be able to borrow money when you need it and receive more favorable interest rates.

Your credit report

Each of the three major credit agencies—Equifax, Experian and TransUnion—compile a credit report using your financial information. Information includes basic data such as age, Social Security number, current and previous addresses, employers and marital status. In addition, your borrowing history, including credit cards, student loans, automobile loans and mortgages will be included. Your credit report comprises all of the credit relationships you have, including when each account was opened, the balance, available credit and whether or not your payments were made on time.

Your credit score

Credit agencies use a complex formula that compiles all of the information above to arrive at your credit score. This is a number from approximately 150 to 900 that rates your creditworthiness. The higher the score the better; a low score indicates that you may not be a good risk to lenders and others who may request your credit report.

Factors that positively impact your credit score include:

  • Some—but not a lot—of loans or credit card debt
  • Prompt payment of monthly bills
  • Paying down balances over time

Items that can hurt your credit score include:

  • Too many credit cards
  • Too many applications for credit
  • Late payments
  • Increasing credit card balances

Get a free credit report

It's important to make sure your credit report is accurate and up to date. This will help protect you from identity theft, as well as catch any errors that may be impacting your credit score. You're entitled to obtain a free credit report from each of the three reporting agencies every year—for your online copy, visit in a new tab).

Being aware of your credit report, making sure it's accurate, working to improve your credit history and understanding the importance of your report can all help you ensure that credit will be there when you need it.

Related topics

Developing and Using a Wise Borrowing Strategy  (Article)

Learn the basics of how proper borrowing can lead to a healthy financial life.

Getting Out of Debt  (Article)

The road to a debt-free future begins with a solid plan.

How Do I Build Credit?  (Article)

Establishing credit is the first step toward future life purchases such as a house or car.

The information provided is not intended to be legal, tax, or financial advice. BB&T hopes you find this information useful but we cannot guarantee that it is accurate, up to date, or appropriate for your situation. You should consult with a qualified attorney or financial advisor to understand how the law applies to your particular circumstances or for financial information specific to your personal or business situation.

Branch Banking and Trust Company, Member FDIC.