Definition of 'Credit History'
A record of a consumer's ability to repay debts and
demonstrated responsibility in repaying debts. A consumer's credit history
consists of information such as: number and types of credit accounts, how long
each account has been open, amounts owed, amount of available credit used,
whether bills are paid on time, and number of recent credit inquiries. It also contains information regarding
whether the consumer has any bankruptcies, liens, judgments or collections.
This information is all contained on a consumer's credit report.
Investopedia explains 'Credit History'
Potential creditors, such as mortgage lenders and credit
card companies, use the information in a consumer's credit history to decide
whether to extend credit to that consumer. This information is also used to
calculate the consumer's FICO score.
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