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Credit bureaus normally store all the information of an individual or a company's credit score. The credit score is a numerical expression based on the statistics, and the credit history is based on facts such as repaying capabilities, late payments, bankruptcy, etc.

The credit history of an individual or company has a lot of significance, as it is referred to by almost all individuals or organizations in order to get a better perspective of the individual concerned. It could be used by prospective employers, landlords, auto insurance companies, etc. In the United States, a person's credit history is always linked to their social security number. This also reveals the credit or loans that have been availed.

The credit worthiness of a person or a company is based on various criteria, such as the ability to repay debts, the willingness to repay loans and the time taken in case of late payments.

The first step to establish a good credit history is to open a savings or checking account at a financial institution and begin from there. The absence of a savings account or credit history would literally mean no credibility as far as lenders are concerned. Care should be taken to avoid check bounces or overdrafts. Although banks play little or no role in the credit history of an individual, credit card companies tend to scrutinize them thoroughly.

If it is possible, book an apartment or get a telephone connection in your name, but make sure that the bills are paid on time. When moving house one must ensure that all these utility bills are paid and disconnected before vacating the premises.

In the absence of credit history, lenders would be looking at the employment history. If one has a steady job with a steady income then there is some hope with the lenders. However, periodic job changes or a period of being unemployed can negatively impact the creditworthiness of a person.

Store cards should be avoided as much as possible. If one wishes to opt for a store card, then one must ensure that they do not report to the credit bureau.

If you are refused a credit card, then the next best thing is a secured credit card. This would help build a good credit history and this in turn will be reported to the credit bureau.

These are a few tips to help build a credit history and indicate its significance. By building a good credit history one would greatly benefit in the long run.