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Module 4: Building Credit

Impact of personal credit on your business

We’re not going to take a very deep dive on personal credit, primarily because it’s a big subject, one with many moving parts. To help you more fully understand personal credit and build skills that will improve your credit position, feel free to visit the FDIC’s Money Smart Modules for Adults.

What is a personal credit report?

A personal credit report (also called a consumer credit report) is a record of how you have managed credit accounts in the past. It tells lenders:

  • Who you are
  • How much debt you have and how long you have had it
  • How frequently you have applied for credit
  • How much credit is available to you and how much you are using
  • Whether you have made timely payments on any accounts
  • What, if any, negative information about you can be found in public records, such as a bankruptcy or foreclosure

It is not a complete picture of all your credit, however. Monthly bills such as rent, utilities, cellphone payments, etc., may not show up in your credit report unless you stopped paying for it, at which point it may show up as a collection. As a small business owner, know that if a tax lien or civil judgment does not appear on your credit report, it doesn’t mean that the debt is no longer owed.

There are three major personal credit reporting agencies: Equifax, Experian and TransUnion. They all use their own formulas to assess your credit and your creditworthiness can vary by agency. The same is true for your credit score.

These companies receive information from creditors, usually monthly, about whether you are making your payments on time and managing your credit effectively. They also collect information from public records, such as bankruptcy filings and court proceedings.

The credit reports these agencies provide each look a bit different, but they contain the same basic information:

Personal Information Credit History Inquiries Public Records
– Name
– Social Security Number
– Current & previous addresses
– Date of birth
– Telephone number
– Names of current & previous employers
– Spouse’s name

– Open credit accounts
– Closed credit accounts
– Charged-off accounts
– Collection accounts
– Consumer statements


A list of businesses that viewed your credit report in the last 24 months when you applied for credit



– Bankruptcies
– Foreclosures




The following items do not appear in your credit report:

  • Personal checking and savings account balances
  • Personal income
  • Medical history
  • Purchases made with cash or check
  • Business account information
  • Race, gender, religion, or national origin
  • Driving record
  • Marital status

Collections made on a business account might appear on your personal credit report if the debt used personal assets to guarantee the loan.