How To Read and Understand Your Credit Report

Any time you apply for credit from a financial institution or other lender they will want to know about your credit history. Every financial move you make is listed on your credit report. Missing or paying late on a loan or credit card is recorded in this report, as well as any other financial issues that might occur. You should obtain a copy of your credit report every year so that you can review it and make sure that there are no surprises. You can take steps to raise a low credit score if you know why your credit score is low. Understanding your credit report can be the key to your financial wellness.

At first glance, you may only want to concern yourself with the credit score and skip the rest of the report when. It is extremely important to review the entire report, especially the information that you already know that may seem unimportant. Your name and address, social security number and date of birth must all be correct. Don’t overlook spelling or other errors that may seem to be minor mistakes. Even though the information is stored on an electronic database there’s still the possibility of human error. More importantly, misspellings and incorrect information can mean that you are a victim of identity theft or fraud. If you find any errors on your credit report, makes sure that you report them immediately.

This section the immediately following your background information is a credit summary. This summary will show past and current accounts. Mortgages, lines of credit, and credit card information are all contained in this section. The outstanding balance and status of these accounts is available for prospective lenders to view. When reviewing this section of your credit report, make sure that all of the accounts that are open were opened by you. Fraudulent accounts can be opened by people who steal your identity.

Your account history shows detailed information about each of the different accounts that you have. Relevant dates, balances and monthly payment amounts are some of the details included here. Other specific information is noted in this account history section, such as the creditor name, type of account, monthly payment amount, credit limit, and any comments a creditor has made regarding your account. Information regarding accounts that have been sent to collection agencies, other than the date, is not available in this part of your credit report.

Following your account history is the public a record segment of your credit report. You’ll find information that is of public record such as tax liens bankruptcies delinquent child support, and any other judgments that may have been made against you

The final section of your credit report lists any inquiries that have been made about you in the last 24 months.

As they get a copy of your credit report whenever you are planning on applying for a loan or suspect that there has been fraudulent activity. You should also take a look at your credit report any time you’ve been denied credit.

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