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This glossary explains important credit terms in plain English, shows why each term matters in a real decision, and points to the next useful check or action.
Start with the word shown on a report, denial notice, collection letter, or application. Read the definition, then use the “why it matters” and “next step” lines to connect the term to the decision in front of you. Definitions are educational summaries, not substitutes for the underlying contract, notice, or current law.
Terms that describe the accounts, dates, and organizations shown in a consumer credit file.
A company that assembles consumer information into reports. Equifax, Experian, and TransUnion are the three nationwide credit bureaus, but specialty reporting companies also exist.
An account record on a credit report, such as a credit card, mortgage, auto loan, or student loan. A tradeline can show the balance, limit or original amount, status, and payment history.
The date an account first became delinquent and was never brought current before the later charge-off or collection. It is different from the date a collector bought the account.
An accounting status a creditor may use after treating a seriously delinquent account as a loss. It does not, by itself, mean the debt was forgiven or that collection activity must stop.
A record created when a company checks a credit report for a lending decision or another transaction that requires permissible access. It is distinct from account review and consumer-access inquiries.
A restriction placed with a consumer reporting agency that limits access to the file for most new-credit decisions until the consumer lifts or removes it.
Terms used when a lender or scoring model evaluates reported accounts and an application.
A formula that converts information in a credit report into a score. FICO and VantageScore are model families, and each family has multiple versions.
The reported revolving balance divided by the reported credit limit. It can be calculated for one card and across all revolving accounts.
Monthly debt obligations divided by gross monthly income. Lenders may calculate more than one version and may apply product-specific underwriting rules.
An account with a reusable credit line and a balance that can change, such as a credit card. The minimum payment and available credit can vary by cycle.
A loan repaid through scheduled payments over a defined term, such as many auto, mortgage, personal, and student loans.
A notice explaining a creditor's unfavorable decision, such as a denial or less favorable terms, and providing required information about the decision and relevant consumer-report rights.
Terms that matter when information is wrong, an account enters collection, or a consumer exercises a legal right.
A company that provides account information to a consumer reporting agency. Furnishers can include lenders, card issuers, servicers, and debt collectors.
The process a consumer reporting agency uses to review a dispute about information in a credit file, communicate with the information provider, and report the result.
Information a debt collector must provide about a claimed debt and the consumer's rights to dispute it. A written validation request can preserve a clear record of what was requested.
The company that first extended the credit or provided the account, as distinct from a third-party collector or debt buyer that may later collect it.
A state-law time limit that can affect whether a collector may successfully sue to enforce a debt. It is separate from the federal period for displaying information on a credit report.
A proposed agreement in which a consumer offers payment or settlement in exchange for a collector asking to remove a collection tradeline. A collector is not required to accept it.
Definitions help decode unfamiliar language, but deadlines, bureau procedures, and legal rights can change. Verify the rule that applies to your situation with the organization responsible for it.
