Page 10 - increase your credit score
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In 2002, the Federal Reserve Bank of Philadelphia published a brief history of credit
reporting in the United States. Their quick overview perfectly describes the evolution of
credit scores:
“The credit data essentially represent a consumer’s credit ‘reputation,’ based as it is on his
or her borrowing and repayment behavior over time.
“In the past, this ‘reputation’ was usually maintained by lots of local agencies working with
local lenders with incomplete and often unverifiable information.
“Today, regulation and consolidation have led to highly automated national firms that
compile far more detailed and complete information and comply with a range of policies
designed to protect the interest of the consumer.”
Chapter 2 Summary:
• Credit files started as a way to judge a borrower’s reliability.
• Local credit offices eventually oversaw credit files.
• Local offices turned into regional and national bureaus.
• Your credit scores reflect your borrowing reputation.
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