Hi everyone you're listening to another episode of the weekly money girl

podcast I'm Laura Adams, the author of Moneygirls Smart Moves to Grow Rich.

I received an email from Amanda who asks,

recently my husband and I applied for a car loan with two different lenders, but got turned

down.

He was denied due to bad credit, and I was denied for having no credit.

I'm confused because the lenders showed different

credit scores for him. How can we clear this up and improve our credit scores?

Amanda's question touches on several issues about credit scores that are commonly misunderstood.

It's important to know how the credit system works and to maintain good credit scores

so you have the option to get credit when you need it.

Credit fact number one, you must have credit accounts to have a credit score.

Lenders and merchants rely on credit scores to make decisions about potential customers.

A credit score is a summary of the information in your credit report at the moment it's reviewed.

If you have little or no credit history,

there simply isn't enough data in your file

to generate a credit score.

In other words, it isn't that you have bad credit, but you have no credit.

This is a common problem for young people and new U.S. residents who are just starting out.

But in a moment, I'll tell you an easy way for anyone to

bill credit. Your credit report can also be too thin to generate a credit

score when your previous credit accounts have expired and fall off your credit file.

...