Logo

Credit History

January 29, 20234 min read

{noun} A record of borrowing and repayment activity over a period of time that reflects your ability to manage and pay your debt obligations.

What Is Credit History?

Your credit history is a record of borrowing and repayment activity over a period of time that reflects your ability to manage and pay your debt obligations. Companies check your credit history by reviewing your credit report, which details information about the number and type of your credit accounts, amounts owed, available credit used, payment history, account opening date, recent credit inquiries, and whether you have any bankruptcies, liens, collections, or judgments.

Your credit history results in a credit report and credit score. Creditors use these to determine whether to extend you additional credit based in part on how well you’ve handled past financial obligations, among other factors. For example, creditors, landlords, and insurance companies typically review your credit report when you apply for a new loan, line of credit, or financial obligation.

How Do You Build Credit History?

Building credit history isn’t something that can be done overnight; it’s something you build over time.

As you open new accounts, creditors report your accounts to one or more of the three major credit bureaus: Equifax, Experian, and TransUnion. Creditors may then report your payment history to the credit bureaus, typically updating your information every 30 to 45 days.

Over time, your payment and account history paints a financial picture as part of your credit report that creditors look at to help them determine your credit risk.


How Is Credit History Related to Credit Score?

Your credit report, which contains your credit history, is used to calculate your credit score—a numerical snapshot of your financial history. A long history of on-time payments and responsible debt management tends to help your score. A short credit history or a spotty financial track record including late payments, collection accounts, and other financial red flags tend to hurt your credit score.

Since your credit history is an ongoing financial story, it can and will change over time. From the day you open your first credit account, your credit history builds. If you make a late payment or experience a financial rough patch, you can continue to rebuild your credit history with a track record of on-time payments.

https://blog.lendingclub.com/how-often-credit-score-updateMuch of the information in your credit reports come directly from your creditors, such as lenders, banks, and credit card issuers. These companies send updates to the credit bureaus with new information about your credit history every 30 to 45 days.

Why Is Credit History Important?

Checking credit reports and credit scores is one way lenders and others evaluate your creditworthiness and determine your credit risk.

  • If you have a short or poor credit history, you might:

  • Pay a higher interest rate when borrowing money

  • Find it difficult to be approved for loans or credit cards

  • Have challenges when applying for a new lease on a home or apartment

  • Suffer setbacks when applying for a job

  • Be required to make a substantial cash deposit for certain utilities

A positive credit history may help you:

  • Get approved for credit

  • Qualify for bigger loans or higher credit limits

  • Receive lower interest rates or more favorable credit terms

  • Qualify for credit cards with rewards and perks

  • Pay less for home, renters, or auto insurance

  • Rent a house or apartment

  • Get a job

How to Check Your Credit History

You can get free copies of your credit reports from Equifax, Experian, and Transunion by visiting AnnualCreditReport.com or calling 877-322-8228. As of the date of this writing, all three credit bureaus continue to offer free online credit reports once per week.

What Does My Credit History Show?

Your credit report typically shows:

Personal identifying information:

  • Name, former names and name variations

  • Date of birth

  • Social Security number

  • Current and previous addresses

  • Phone number

Credit accounts:

  • Current and closed credit accounts

  • Amount of loan or credit limit

  • Current balance

  • Payment history

  • When the account was opened

Negative information (if applicable):

  • Accounts in collections

  • Foreclosures within the past 7 years

  • Bankruptcies up to the past 10 years (or more in certain instances)

  • Late payments

Inquiries:

If someone has checked (or “inquired into”) your credit report within the past 2 years, that will be listed.

Why Should I Check My Credit Report?

Credit reports sometimes have errors that can negatively affect your credit score, which can make it harder to get credit.

For this reason, it’s wise to check each credit bureau’s credit reports at least once a year and review them carefully. If you find incomplete or incorrect information, contact the appropriate credit bureau to file a dispute. (And if you find an error in one bureau’s credit report, check the other two.)

Discovering an account you don’t recognize on your credit report could be a sign of identity theft or other fraud. Contact the creditor and the Federal Trade Commission for information and to learn how to proceed.

What If You Don’t Have a Credit History?

You need credit in order to build a credit history. If you’re a student, don’t have a credit account, or have never borrowed money or used credit cards, you won’t have a credit history. Fortunately, building a credit history isn’t difficult.

Making timely payments on a student loan is one way to build a credit history; another is to take out a credit-builder loan. You can also ask a friend or family member with good credit to add you as an authorized user on one of their credit cards. Applying for a store credit card or secured credit card is also an option; these cards are generally easier for people without credit histories to obtain.

To build a positive credit history, make your loan and credit card payments on time. With each passing month and year, you’ll build a stronger credit history, which can open many financial doors.

You May Also Like

Related Articles
Taxes may not be the most exciting thing you'll ever do, but if you have a personal loan, knowing the potential tax implications can help when it comes time to file your return.
Oct 8, 2024
6 min read
Are Personal Loans Tax Deductible?
If you’re in the market for a new car, you might be wondering if your current credit score will help you get a good deal or hold you back. Your credit score is an important part of the process, but it’s not the only factor. Though good and excellent credit scores help when taking out any line of credit, it is possible to buy a car with a less-than-ideal score.
Sep 30, 2024
6 min read
good credit score for a car
Chances are, you’re managing money differently today than you were a few years ago. If your shopping, spending, and money management have moved online and onto your phone, you might want to consider whether an online-only bank is a fit for you.
Sep 30, 2024
7 min read
Guide to Banking Online
Pride of homeownership also means managing (and paying for) what can often feel like an insurmountable list of repairs and improvements. Sometimes it's difficult to know when to DIY a home repair project or find a handyman or other professional better equipped to handle it for you. Learn which common home improvement projects are simple enough to tackle on your own, and when to call in the experts.
Sep 28, 2024
8 min read
DIY home repair
Opening a bank account online is a convenient way to manage your money without setting foot in a local branch. Today, many online-only banks, traditional banks, and credit unions have easy online applications, so you can shop around and open an account from the comfort of your home.
Sep 25, 2024
6 min read
How to Open a Bank Account Online
Related Impact
From groceries and diapers to Halloween costumes for pets, nearly 60% of American consumers prefer to shop online for everyday items that make life more convenient, comfortable, and enjoyable. And with rising prices showing no signs of stopping anytime soon, we’re pleased to introduce StackitTM from LendingClub Bank—a new browser extension that automatically finds and rewards eligible members with coupons and cash back for extra savings at more than 15,000 favorite online retailers.
Nov 13, 2022
2 min read
blog header stackit 765x430 v1-1
Even in today’s low-yield, high-inflation environment, it’s essential to keep a certain amount of money in an easy-to-access checking or savings account for things like daily household and emergency expenses, or to meet short-term financial goals.
Oct 2, 2022
5 min read
LendingClub Rewards Checking Nationally Certified as Trusted, Afforda
Since 2007, LendingClub has been on a mission to deliver a world-class experience to all our members. This month we took a moment to reflect on the more than four million members who have chosen LendingClub as their partner to help them reach their financial goals.
Apr 19, 2022
2 min read
Illustration of large number 4 and letter M made up of colorful, tiny illustrations of ethnically diverse people
In March 2022, we hosted our first quarterly webinar where we celebrated our one-year anniversary as a digital marketplace bank. 
Mar 6, 2022
less than a minute read
Blog-post
LendingClub completed the acquisition of Radius Bank in February 2021. At that time, in addition to the direct-to-consumer deposit business, we inherited a fintech partner program, and several lending businesses. As we reach the one-year anniversary of the acquisition, and in conjunction with the conclusion of a strategic review of our business operations, we have made the decision to discontinue certain businesses that don’t fit our mission.  
Jan 2, 2022
2 min read
Man in blue button up shirt and glasses smiling
Related FAQ's
We offer several ways for you to make your monthly auto loan payment, so you can choose the method that works best for you. A statement will be mailed to you every month that shows the payment amount and due date.
Nov 29, 2023
less than a minute read
LendingClub provides a year-end statement that summarizes your account activity, including how much interest you’ve earned and information regarding Notes tied to loans that have been charged off.
Jun 7, 2023
less than a minute read
Once you’ve submitted your application, we’ll try to confirm your information on our own. Sometimes, you may need to submit a few documents to confirm your identity, income, or vehicle ownership.
Jun 7, 2023
less than a minute read
Once you submit your Auto Refinance application, we may ask you for additional paperwork to verify your information.
Jun 7, 2023
2 min read
If we’re not able to offer you a lending product, you're welcome to apply through one of our lending partners.
Jun 7, 2023
2 min read
Related Glossary
{noun} A type of credit that allows the borrower to make charges and payments against a set borrowing limit, paying interest only on outstanding balances.
Sep 6, 2023
4 min read
{noun} The total annual cost to borrow money, including fees, expressed as a percentage.
Mar 21, 2023
3 min read
{noun} The amount of unpaid interest that has accumulated as of a specific date, either on a loan or an interest-bearing account or investment. 
Mar 21, 2023
4 min read
A debt that is written off as a loss because the financial institution or creditor believes it is no longer collectible due to a substantial period of nonpayment.
Feb 7, 2023
3 min read
{noun} An interest rate that remains the same for a set time, usually for the life of the loan.
Feb 4, 2023
3 min read

Unless otherwise specified, all credit and deposit products are provided by LendingClub Bank, N.A., Member FDIC, Equal Housing Lender (“LendingClub Bank”), a wholly-owned subsidiary of LendingClub Corporation, NMLS ID 167439. Credit products are subject to credit approval and may be subject to sufficient investor commitment. Credit union membership may be required. Deposit accounts are subject to approval. Deposit products are FDIC-insured up to $250,000 per depositor, per ownership category.

"LendingClub" and the "LC" symbol are trademarks of LendingClub Bank.

© 2024 LendingClub Bank. All rights reserved.