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What Is a Credit History?

6 min read
Last Updated: June 3, 2025
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Key Takeaways

  1. Your credit history is a summary of your experience managing credit accounts and debts.

  2. Credit history is important because it’s used by credit card companies, mortgage lenders, landlords, and employers to determine your creditworthiness and risk.

  3. Your credit score is a number based on your credit history, but the two aren’t the same thing.

If you’re applying for an additional credit card, seeking additional funds with a personal loan, or applying for an apartment, you may need to review your credit score to assess whether you’ll be approved. Or maybe you’re applying for a credit card for the first time and want to know how important your credit history is for your financial future.

If you’re curious about credit history and credit scores, review this guide to help you better understand these important financial terms.

Definition of credit score and credit history

What is credit history, and what’s a credit score? These two important concepts can impact a person’s finances but can be difficult to understand. Here, we’ll break down what you need to know about credit history and credit scores, and why they’re important.

Credit history

Your credit history is the information recorded about your experience managing credit accounts and debts. Someone with a good credit history might be eligible for favorable loan terms and flexible account types. Meanwhile, someone with a poor credit history might be subject to a higher interest rate.

Your credit history appears on your credit reports as a list of credit accounts in your name. The list includes each account’s name and status, activity on loans and credit cards, loan type, and more. Lenders use this information to determine your creditworthiness.

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Each month, creditors report your activity to at least one major credit bureau. Because some creditors may not submit to all three, your history may be different at each agency.

Your credit history includes:

  • The number and types of credit accounts you have open, such as credit cards, mortgages, student loans, and car loans
  • How long your credit accounts have been open
  • Your credit utilization ratio, which is calculated by dividing your outstanding balances by your total credit limit
  • Whether or not you’ve made on-time payments
  • The number of recent hard credit inquiries
  • Any bankruptcies and collections

Credit score

A credit score is a three-digit number that reflects a consumer’s creditworthiness. A credit scoring model calculates your credit score using your credit history. Your score can vary depending on which credit bureau you get your credit score from. This is because each credit bureau may use a different credit scoring model. As noted above, the model might use different information to calculate your score. Some lenders might prefer one model over another. For instance, 90% of top lenders use FICO® Credit Scores, including Discover®.1

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Why your credit history is important

Credit history is important because credit card companies, mortgage lenders, and landlords use this information to assess your creditworthiness. They want to understand how you’ve managed your financial commitments in the past to determine whether you’re someone they could trust with a loan of money or property.

These businesses may pull your credit history and credit score to determine the risk of working with you and decide which products and terms you’re eligible for.

Good credit score and history

Lenders may review the specifics of your credit history to see what kinds of accounts you’ve had in the past and how long you’ve had them. They might also look at your credit score. A good credit score can help you get offers for lower interest rates and more credit options. A high credit score (which is based on your credit history) tells lenders that you make on-time payments, responsibly maintain your accounts, and keep your credit utilization ratio low. A “good” FICO® Score is 670 or higher.1

Poor credit score and history

A low credit score and poor payment history might indicate that you’re a risk to work with. Lenders might be concerned you’ll have difficulty making payments on time and managing debts. As a result, a poor credit history may lead a lender to offer a higher interest rate and a lower credit limit.

Did you know?

If you’ve had trouble managing your finances in the past and have a poor credit history, it can be hard to get new credit. But it’s possible. You can rebuild your credit history with the Discover It® Secured Credit Card3 and stay on top of your credit score.

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No credit history

In addition to having a poor credit history, having no credit history can make it challenging to qualify for new credit. You may not have a credit history if you’ve never had a credit card or borrowed money in your own name. Lenders who can’t review your credit history are less likely to lend you money.

If you don’t have a credit history, it’s a good idea to open your first account to start building one. While it may be difficult to be approved for certain leases and loans, there are ways to get a credit card with no credit history.

As mentioned before, a secured card can help you start a credit history. If you’re enrolled in college, you can also build your credit history4 with a Discover® student credit card. Using your card responsibly by making on-time monthly payments and keeping your balance low can contribute to a strong credit history.

How to improve your credit history

If your credit history isn't exactly where you'd like it to be, there are ways to improve it.

  • Pay down your existing balances. Try to minimize your credit utilization and, eventually, pay off your debts. 
  • Set up autopay through your online banking portal. Your payment history is important to lenders, so you should avoid even one missed or late payment.
  • If you’re ready, consider a secured credit card to rebuild your credit history. 
  • Consider credit counseling to help you manage credit card debt and make informed credit decisions moving forward. 

How to check credit history

Your credit history contains a lot of important information about your finances. It’s a good idea to check your credit history regularly to track your progress and meet your financial goals. You can request your credit report and credit history for free once a week at annualcreditreport.com.

The bottom line

Your credit history gives lenders a chance to see if you’ve been a responsible borrower in the past. Anyone extending you credit wants to know if you’re going to pay them back, and this includes credit card companies, mortgage lenders, landlords, and even employers. The better your track record, the more opportunities you’ll have to access new credit in the future.

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