A credit report can be a powerful and influencing force in your life. Lenders will look at it closely when deciding whether or not to trust you with a loan, limiting the availability of credit cards, loans or even mortgages. Even insurance companies and employers can use the information to determine your rates or as a factor in offering you a job or promotion respectively. Your credit report is absolutely essential for you to live a free and healthy economic life and it is important that the information it contains paints you in as best a light as possible.

A credit history or credit report is, throughout most of the world, a record of an individual's past borrowing and repaying, including information about late payments and bankruptcy. In the UK when a consumer fills out an application for credit from a bank, store or credit card company, their information is forwarded to a credit history bureau - like Experian. The credit bureau matches the name, address, financial associates and other identifying information on the credit applicant with information retained by the bureau in its files.

This information is used to assign a credit score, a numerical expression based on a statistical analysis of a person's credit files, to represent the creditworthiness of that person, which is the perceived likelihood that the person will pay debts in a timely manner.  Lenders, such as banks and credit card companies, use credit scores to evaluate the potential risk posed by lending money to consumers and to mitigate losses due to bad debt.
The willingness to repay a debt is indicated by how timely past payments have been made to other lenders. Lenders like to see consumer debt obligations paid on a monthly basis.

Income is possibly the most important factor in determining whether a lender will provide a consumer credit or a loan. The higher the income, all other things being equal, the more credit the consumer can access as the borrower is considered less at risk of default. However, lenders can make a credit lending decision on the past credit history and credit score as well as income.

All of these factors help creditors decide whether to extend credit, by how much and on what terms. With the adoption of risk-based pricing on almost all lending in the financial services industry, this report has become even more important since it is usually the sole element used to choose the annual percentage rate, grace period and other contractual obligations of the credit card or loan.

If you feel your credit score is unfairly low, or you just wish to understand why, there are many companies that will sell you a copy. Some companies charge for credit report repair information, giving you what amounts to helpful hints; where to get your credit report; how to write a letter and other so called credit report repair information that you can find on your own for free. If you have any “proof” that the information is inaccurate you can get it changed, however what constitutes as proof can vary from company to company.

Don’t be discouraged by thinking that you don’t have the knowledge to clean up your credit report and that a credit repair agency knows a bunch of angles that have eluded you. The information you need to know in order to fix errors on your credit report is readily available and on hand, there is no need to hire a third party to take care of the matter for you.

Beware adverts on websites, in magazines or newspapers from companies that claim to be able to repair or 'clean' your credit history - that simply isn't possible. Your credit history can only change by changing how you behave and creating a new and better history as time goes on. If you hire one of these companies you'll not only be wasting your time but also your money. However, if you're in debt and struggling to recover, do consider contacting a specialist debt advice company - doing this and taking their advice will have a long term benefit on your credit rating.

In the event that you find any inaccuracies, you can have your credit repaired by requesting, in writing, that the credit bureau investigate the disputed items. This will take time and you will have to provide any supporting documentation you can included in the request, otherwise simply state where the confusion is and request that it is fully investigated. If the credit bureau cannot verify the information you are disputing, by default it must be removed from your file -the onus is on them to prove you've done something wrong, and even better if the bureau doesn’t respond to your request for an investigation within 30 days, the information in dispute must be removed.