Your credit report has a huge impact on the things you do in your life. My goal is to help you check your credit report for accuracy and to understand how your report affects the credit you can get.
“A credit report contains information about your credit such as loan paying history and the status of your credit accounts. Lenders use these reports to make lending decisions.” – Consumerfinance.gov
Credit bureaus, also known as credit reporting agencies (CRAs), collect this information from merchants, lenders, landlords, etc., and then sell the report to businesses so they can evaluate your application for credit.
Information that makes up your credit report includes:
- Personal identifying information – This includes your name, address, SSN, DOB, employers, and your spouse’s name may be included as well.
- Credit history – This includes your bill-paying history with banks, retail stores, finance companies, mortgage companies, and others who have granted you credit. It includes information about each account you have, such as when it was opened, what type of account it is, how much credit it includes (or the amount of the loan), what your monthly payment is, etc. If you’ve closed the account or the loan has been paid off, then that information shows up as well. If there were missed or late payments, this is where that appears.
- Public records – Information that might indicate your credit worthiness, such as tax liens, court judgments and bankruptcies.
- Report inquiries – This section includes all credit granters who have received a copy of your credit report. It also includes any others who were authorized to view it. In addition, lists of companies that have received your name and address in order to offer you credit are included. These companies don’t actually see your report, but get your name if you meet their criteria for an offer of credit, insurance or other product. This is where all of those “pre-approved” credit card offers come from.
- Dispute statements – The report may also include any statements you’ve made disputing information on the report. Most credit bureaus allow both the consumer and the creditor to make statements to report what happened if there is a dispute about something on the report.
You’ve probably heard about a credit score as well. Don’t confuse your credit score with your credit report. Credit scores are based on formulas that use the information in your report, but they are not a part of your report. Your credit score gives lenders an easier way of making decisions about your credit. These numbers range from 300 to 850.
How Credit Bureaus Get Information:
There are three large national credit bureaus – Equifax, Experian, and TransUnion.
If you apply for a credit card and provide the company with your personal information, the credit card company then contacts a Credit Bureau and reviews your credit report. If the company approves your application for a credit card, then the information you’ve supplied is forwarded to the Credit Bureau. That credit card company also reports your payment history to the Credit Bureau, so that becomes part of your report.
All of your credit related transactions are reported to Credit Bureaus. Most large creditors report this information to all three national credit bureaus (CRAs). Some smaller lenders or merchants may only report the information to one. This is why your scores may be different for each one. Always review copies of all three reports.
What to know about Credit Inquiries:
When you apply for a credit card to get a free gift or discount you are adding another hard inquiry to your credit report. When lenders see these inquiries, it may wrongly imply that you’re either in some financial situation where you need a lot of credit, or are planning to take on a large debt. This can flag you as a high credit risk.
Other types of inquiries, such as your own requests to view the report and employer requests to view the report count as soft inquiries. These inquiries don’t show up on the reports that lenders see, and therefore don’t affect how they view your credit.
Contact information for all three national credit bureaus in the United States.
• Equifax – www.equifax.com
To order your report, call: 800-685-1111
To report fraud, call: 800-525-6285/ TDD: 800-255-0056
• Experian – www.experian.com
To order your report, call: 888-397-3742
To report fraud, call: 888-EXPERIAN (397-3742)/ TDD: 800-972-0322
• TransUnion – www.transunion.com
To order your report, call: 800-916-8800
To report fraud, call: 800-680-7289/ TDD: 877-553-7803
Check out this Forbes article for effective ways to increase your credit score!