Understanding Your Credit ReportLast updated: October 9, 2012
I used to apply for credit cards, car loan and even inquired with regards to home financing. And more often than not I always encounter the word “credit report” of which I barely have an idea of what was it all about.
Not until I got an advertisement email that focuses primarily on “Understanding Your Credit Report”, and of course I read on and found out various important aspect in my credit activities.
A credit report is a record of all your finance activities whether it is a loan acquisition, credit card application and all sorts of money matters that involve you. It also keeps track of how you use your credit and also the promptness whenever you make your monthly payment.
Understanding your credit report may help you consolidate every aspect of your financial condition. These reports will definitely reflect and can be used as reference by various credit institutions in the evaluation of your credit card application.
What’s in Your Credit Report
- Personal information: It contains your name, social security number, birth date, spouse’s name, current and previous addresses, phone numbers, and even your employment records.
- Credit information: This section lists all the accounts that have been reported by various institutions with which you have established a credit relationship; eg, credit cards, loans, mortgage, phone companies, insurance companies, or any other lines of credit.
- Banking information: Any bank account you have, including any NSF (non-sufficient funds) or “bad” cheques you may have written.
- Public records: A list of public record such as a bankruptcy filling or a credit-related court judgment against you in a lawsuit. Secured loans, which are backed by an asset i.e. your property, may also appear in your credit report.
- Collection information: This shows whether you ever had a debt that you could not pay, which was referred to a collection agency for payment.
- Consumer statement: Any statement you may have made to explain a particular situation, such as a dispute with a financial institution or a fraud warning.
- Credit report inquiries: A list of all of the people who have inquired about your credit: including yourself, a lending institution, or any other credit institutions.
Although your credit report may include vital information regarding your personal data it does not necessarily keep track of your religious inclination, race, health records, standard of living, political involvement, personal setting and criminal documentation.
Discrepancy within any of your information or records shall be immediately filed for evaluation and reconfirmation to the Credit institution concern, you may also include pertinent documents and supporting papers that may help clarify any flawed data to be corrected. Disputed entries are evaluated within 30 days; the law allows deletion of any inaccurate information in your records if the credit institution is incapable of confirming its validity.
Being prepared gives you a better chance of withstanding any future problems that may arise and affect your situation, or better yet understanding your credit report score now can give you a better perspective with regards to your financial standing and take necessary steps to improve your credit score when needed.
You may also request your free reports from these credit institutions — Experian, Trans Union and Equifax — to aid your queries in understanding your credit report. However, note that this free credit report is NOT your credit score or FICO score that creditors or lenders used to gauge your creditworthiness.
To view the actual score that the lenders are seeing, get your score (plus 3 in 1 credit report) from Free Score Finder for a free trial.
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