What Is Credit History?

Find out what information your credit history contains and how it relates to your credit report and scores


When credit history comes up, it probably has to do with how someone handled debt in the past and what’s going on with their finances right now. That means information like what accounts a person has open, how long they’ve been open and whether the account holder made payments on time.

But there’s plenty more to know—like how credit history makes its way into credit reports and how it affects credit scores and lending decisions. Understanding how these pieces fit together can help you better manage your credit. And this article will help explain some of the basics.

Credit History in Credit Reports and Credit Scores

Many people’s credit history starts with an application for a loan or a credit card, according to the Federal Trade Commission. As people use a financial product and pay their monthly balances, the lender may report details about account activity to the credit bureaus.

For example, your credit card issuer may report the date you opened a credit card, your current balance and your monthly payments, including any you missed. When credit bureaus—like Equifax®, Experian® and TransUnion®—receive that information, they add it to your credit reports.

In turn, those reports are used when a company like FICO® or VantageScore® calculates your credit scores

Why Is Credit History Important?

So your credit history goes into your credit reports, which then are used to calculate credit scores. But that’s not the only place it potentially can have a big financial impact. According to the Consumer Financial Protection Bureau (CFPB), your credit history may also come into play in these situations:

  • Lenders may use your credit reports to help them decide whether you qualify for a loan and to set loan terms like interest rates and monthly payments. 
  • Insurance companies may use the information when setting your insurance rates. 
  • Landlords may review your credit when you apply for an apartment lease. 
  • Utility companies may look at your credit history when you set up an account, to decide whether a security deposit is required. 
  • Employers may also check your credit reports to make hiring decisions.

Good Credit History vs. Bad Credit History

When companies review your credit history, they want to find out how you’ve managed debt in the past, the CFPB says. And making on-time payments and keeping your debt balances low are generally seen as responsible credit behaviors. These habits may lead to good credit scores and are necessary to maintain a good credit history.

On the other hand, missing payments and charging too much on your credit cards may lead to a less-than-perfect credit history. Setting electronic reminders can help you remember to pay on time, and paying off your balances each month can help you keep a healthy credit utilization ratio.

No Credit History

The CFPB says millions of Americans are “credit invisible,” because they don’t have enough credit history to be scored. Young adults, college students and recent immigrants may fit this description. If you haven’t established credit yet, here are four ways to get started:

  • Apply for a credit card. While there are many credit cards to choose from, a lack of credit history may make it harder to qualify for a traditional credit card. If you’re faced with this challenge, there’s another option called a secured credit card. To open one of these accounts, you typically give the credit card issuer a security deposit upfront—it’s usually refundable. And as you use the card and make on-time payments, you could start to build a positive credit history.
  • Become an authorized user. As an authorized user on another account, you get your own card and can use it to make purchases. If the card issuer reports the account activity, then you could build credit as long as the account is used responsibly. Keep in mind that negative information, such as missed payments, may lower your credit scores. Before opening the account, check with the card issuer to see how they report information for authorized users. 
  • Take out a credit-builder loan. Instead of receiving the money upfront like a traditional loan, money for a credit-builder loan goes into a dedicated account. As you make payments over a fixed period to match the amount, the lender reports them to credit agencies to help you establish credit. And once you pay off the loan, you receive the money.
  • Pay your rent and bills on time. Making on-time rent payments could also help you build a positive credit history. But that’s only if the payments are reported to credit bureaus. This kind of information is known as alternative data, a category that includes utility bills and rent payments. Be aware: Negative information could also hurt your credit.

Check Your Credit History

Building credit history takes time, effort and responsible use. Regularly checking your credit can help you track your progress and make sure the information in your credit history is accurate. You can also get free copies of your credit reports from each of the major credit bureaus by visiting AnnualCreditReport.com

CreditWise from Capital One can help too. You can access your TransUnion credit report and weekly VantageScore 3.0 credit score as often as you like—without hurting your credit. Plus, it’s free for everyone, Capital One customer or not. 


Learn more about Capital One’s response to COVID-19 and resources available to customers. For information about COVID-19, head over to the Centers for Disease Control and Prevention

Government and private relief efforts vary by location and may have changed since this article was published. Consult a financial adviser or the relevant government agencies and private lenders for the most current information.

We hope you found this helpful. Our content is not intended to provide legal, investment or financial advice or to indicate that a particular Capital One product or service is available or right for you. For specific advice about your unique circumstances, consider talking with a qualified professional.

Your CreditWise score is calculated using the TransUnion® VantageScore® 3.0 model, which is one of many scoring models used by lenders. It likely won’t be the same model your lender uses, but it is an accurate measure of your credit health. The availability of the CreditWise tool depends on our ability to obtain your credit history from TransUnion. Alerts are based on changes to your TransUnion and Experian® credit reports and information we find on the dark web. The tool is not guaranteed to detect all identity theft.

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