Lesson 01 of 11
What credit is and why it matters
Credit is an agreement: a lender lets you borrow now, and you agree to repay under stated terms.
A credit report can summarize how you have used credit. Lenders, landlords, insurers, and employers may use reports or scores in certain situations, subject to applicable rules and permissions.
Plain-language example
Example: Paying a phone bill does not automatically build credit. A credit card, loan, or other account usually has to report to a credit bureau for it to appear on a report.
Quick knowledge check
Which statement best describes credit?
Smart next step
Write down any accounts you already have and the payment due date for each one.