A credit report is a summary of the information in your financial history that the credit bureaus (Equifax, Experian and TransUnion) collect about you. Credit card lenders, mortgage lenders, auto loan companies and other businesses use this information to make decisions about your creditworthiness when you apply for credit. These credit bureaus also sell your credit report to others, including employers, insurance companies and landlords. However, these companies must have your permission before they view your report.
The credit bureaus update your credit reports regularly as new information is reported by lenders and older items are gradually removed from the credit files according to federal retention rules. You can request a free copy of your credit report from each of the three nationwide consumer reporting agencies (Equifax, Experian and Tranunion). You may notice that the information in your credit reports sometimes varies slightly between the three reports. This can happen because different creditors send information to each of the credit bureaus, and not all three bureaus may receive the same data from every lender.
Your credit report includes the following items:
Personal information. This includes your name, current and previous aliases, address, birth date, Social Security number and phone numbers. The credit report may also include your spouse’s name if it was reported by a creditor, and the names of any co-applicants on credit applications. You’ll also find a list of places you’ve lived, which can be helpful when settling a dispute about an incorrect address.
Accounts: A detailed list of your past and present credit accounts, both revolving credit, such as credit cards, and installment loans, such as auto loans or mortgages. It shows the creditor, account number, balances and payment history. It also indicates whether the account is open or closed, and if it’s delinquent.
Public records: This section contains information about any legal judgments, liens or bankruptcies that have been placed against you. It also includes any collection accounts that have been sent to a debt collector.
Inquiries: The bottom of your credit report lists any entities that have recently asked to see your credit file, either through a hard inquiry, which is done when you apply for credit, or a soft inquiry, which occurs when you check your own credit. This section also displays the dates of those inquiries.
Your credit score: The most important piece of information on your credit report is your credit score, which is a numerical calculation based on the information in your credit report. Your credit score is used by lenders to determine whether or not to lend you money and what interest rates you might qualify for. It’s also used by insurance companies to price your premiums and by employers to assess job applicants.
Errors on your credit report can have a big impact on your life and can affect your ability to obtain financing, jobs or even rent an apartment. Checking your credit report frequently can help you correct errors and prevent them from harming your finances and your reputation.