The CFPB has released a new study about credit history. It found, among other things, that credit card activity is the solitary most essential factor analyzed by credit reporting agencies when figuring out credit history.



Essential for credit



Most people are not surprised by the fact that credit scores are affected by credit cards. There are ways to use your card to be able to make it easier next time you need a loan for your car or your mortgage.



CFPB director Richard Cordray said: “Credit cards are given great weight in credit profiles -- a lesson that consumers could end up learning the hard way.”



According to the Consumer Financial Protection Bureau report, more than half of the data on the typical credit rating report comes from credit card corporations.



Cordray said that during the holiday season some consumers may be tempted to fill out a new retailer charge card application to be able to get a discount on gift purchases. However, if they do not use that card in a responsible way, such as paying off all charges each month, they could find themselves effortlessly falling into a debt spiral. He said, “it could end up costing a lot more down the line when they go take out a mortgage and that credit card is a black mark on their credit rating.”