Your credit score may seem like it's based on a mysterious formula calculated using factors that are impossible to understand. But if you've ever felt confused by the numbers that appear on your credit report, you're not alone. According to a recent survey, most Americans don't understand the effect that common actions have on their credit score.

Here's the good news — credit reporting is actually highly regulated. Thanks to the 1970 Fair Credit Reporting Act (FCRA), credit bureaus and lenders must adhere to a strict set of rules when they report or use consumer credit information. But lately, there's been talk of utilizing "digital footprints" in credit scoring and lending decisions, and the FCRA might not regulate that information.

What does this digital footprint mean in the financial world?

"A digital footprint is information that a financial institution could collect about how you are interacting with the institution as part of the application process," said Christopher J. Willis, the Practice Group Leader for Ballard Spahr's Consumer Financial Services Litigation Group. "For example, the email you use and the type of device you have or the website you came from. Some of these things are predictive about how likely you are to be a responsible borrower."

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