When you apply for a loan or other credit, lenders will look at both your business and personal credit score and report to help determine your creditworthiness. Let's take a closer look at what a consumer report and score can show a lender about your credit history.

Consumer credit score

A consumer credit score is a three-digit number that represents your creditworthiness. Your score is calculated based on the data in your credit report and plays an important role in your ability to qualify for financing. There are three main consumer credit agencies that report this number: Equifax, Experian, and TransUnion. Your credit score will likely vary with each agency. FICO® Credit Scores are the most commonly used scores by lenders in the U.S. They are created by Fair Isaac Corporation (FICO®). FICO® Credit Scores usually range from 300 to 850; the higher your score is, the less risky you are to lenders.

The key elements that go into your FICO® Credit Score are payment history, outstanding debt, how long your credit has been established, the types of credit accounts you carry, and recent credit activity.


Check Your Personal Credit Score -
Eligible Wells Fargo customers can access their FICO® Credit Score through Wells Fargo Online®.

Consumer credit report

A consumer credit report is a detailed summary of your personal financial history and helps lenders determine how responsible you are with your finances. Your consumer credit report includes details on your current and past credit accounts, credit inquiries (the number of times you've applied for credit) and public information about bankruptcies or tax liens. Credit agencies receive this information directly from banks and companies you do business with. Federal and state laws govern who can access your personal report and requires the agencies to let you order copies yourself.

You can request a free copy of your credit report from each of three major credit reporting agencies – Equifax, Experian, and TransUnion – once each year at AnnualCreditReport.com or call toll-free 1-877-322-8228. You're also entitled to see your credit report within 60 days of being denied credit, or if you are on welfare, unemployed, or your report is inaccurate.

It's smart to request a credit report from each of the three credit reporting agencies and to review them carefully, as each one may contain inconsistent information or inaccuracies. If you spot an error, request a dispute form from the agency within 30 days of receiving your report.

What to look for in your consumer credit report

Here are a few factors lenders look at when examining your personal credit report:

  • Payment history: Making timely payments on your accounts is a big deal for potential lenders and makes up approximately 35% of your score. If you have missing or late payments on your credit report, lenders may question your responsibility as a borrower and think twice about approving you for credit.
  • Outstanding debt: The amount of debt you currently owe is also an important factor for lenders and contributes to approximately 30% of your score. If your debt load is too high, lenders may worry that you will have trouble paying new debt.
  • Length of credit history: This accounts for approximately 15% of your score. The longer your history of making timely payments, the higher your score will be. It may seem wise to avoid applying for credit and carrying debt, but it can actually hurt your score if lenders have no credit history to review.
  • Types of credit: The types of accounts you have make up approximately 10% of your score. Having a mix of accounts, including installment loans, home loans, and retail and credit cards may improve your score.
  • New accounts: Applying for credit and opening several credit cards in a short time frame may make lenders wary of your financial situation. They may think that you are in a financial bind and wonder if you will be able to pay back new debt. However, if you are looking for a mortgage, auto, or student loan, multiple lenders may make an inquiry. For this reason FICO ® Credit Scores ignore such types of loan inquiries made in the 30 days prior to scoring.

Your business credit report will contain a lot of the same information as your consumer credit report but will be specific to your business's credit track record.

If you have a strong understanding of what lenders look for in your credit report and take the necessary steps to maintain a positive credit rating and a high credit score — both personal and business — you can increase your chances of getting approved for financing.

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