What's Beyond Your Credit Report?

Credit scores represent, in theory, your creditworthiness -- the likelihood that you will pay your debt. And the likelihood that you will get the best interest rates and the maximum amounts on loans you need and want for cars, small businesses, and more.

According to the Consumer Financial Protection Bureau and the Census Bureau, despite about $2 trillion worth of credit card transactions running through the American banking system, only about 16 million people a year, out of about 183 million credit cardholders in the U.S. request a free annual credit report directly from the three nationwide credit reporting agencies.

But you're military; you know the importance of staying on top of things. So you do review your credit report twice annually.

But even if you see your credit report regularly, many of the credit scores calculated for and used by lenders are not available to you.

Those credit scores are likely to vary based on different scoring methods and differences in the data as well as individual lender criteria.

Consumers unaware of the variance in credit scoring among lenders may view their credit reports and see a score believing it is their "true" score when in reality, the score their lenders are seeing is quite different.

Lenders use some different criteria when it comes to determining the likelihood that you will pay your debt. It's hard to say exactly how different lenders will "weight" different criteria, but here are some tips to help you maintain the kind of higher credit score that lenders will like:

DON'T CONSOLIDATE YOUR DEBT

Think carefully before consolidating high credit card debt through a second mortgage or home equity line of credit because most credit card debt is considered "unsecured debt" while mortgages and home equity loans are "secured debts" that require you to put up your home as collateral. If you cannot make the payments on secured loans, you could lose your home.

DO GET CREDIT COUNSELING

Don't wait til you're already in trouble. If you see yourself headed towards credit problems, consider contacting a reputable credit counseling organization such as one offered by a university, military base, housing authority, or branches of the U.S. Cooperative Extension Service.