Building your credit begins with reviewing your credit reports

Experts say the first step in building credit is to obtain and review credit reports from Equifax, Experian and TransUnion to find errors; the Consumer Financial Protection Bureau recommends checking these reports annually. FICO notes that payment history is the largest factor in scores, accounting for 35% of the calculation.

People starting to build their credit are urged to begin by looking at their credit reports to understand current standing and spot possible errors. A 2023 FDIC survey found one in six consumers lacks mainstream credit such as a credit card, mortgage or auto loan, which can make the first step feel daunting. The article quotes industry experts who say obtaining reports from the three nationwide bureaus—Equifax, Experian and TransUnion—and reviewing them line by line is the recommended initial move. The Consumer Financial Protection Bureau is cited as advising annual reviews of these reports, especially before applying for major credit products. Key points: - One in six consumers does not have mainstream credit, according to a 2023 FDIC survey. - Ali Zane, CEO of Imax Credit Repair & Identity Theft Firm, is quoted saying to obtain reports from Equifax, Experian and TransUnion and check them for mistakes and fraudulent accounts. - Free copies of all three credit reports can be requested from AnnualCreditReport.com, and services like Credit Karma offer access to reports and scores from some bureaus. - The Consumer Financial Protection Bureau advises reviewing reports from the three nationwide consumer reporting companies every twelve months. - FICO states payment history makes up 35% of a credit score, and experts in the article describe on-time payments as the most influential factor; reporting rent or utilities is mentioned as one way some consumers can build a payment record. Summary: Reviewing credit reports can reveal errors that affect credit scores, and federal guidance recommends checking reports from Equifax, Experian and TransUnion annually. Experts also emphasize that consistent on-time payments are the single largest factor in credit scores, and the article notes options such as rent or utility reporting exist in some situations.