Understanding the Credit Reports

Credit scores are different from credit reports. The former is a figure computed using several factors and appears on the latter. Credit reports are a thorough profile about your financial reputation. It tells whether you have been responsible and diligent in your obligations.

In the United States, any consumer can have free access to credit reports three times a year, from three largest credit monitoring offices. This is made possible by the Fair Credit Monitoring Act.

What Can You Find on Your Credit Report?

A simple comparison that can be made about credit reports are financial resume. They itemize every detail about your credit activities—loans and payments made including delayed and missed. Generally, credit reports are the basis on which creditors can assess whether you are a risk to them as a borrower. It is also the information from that report that creditors determine the interest rate they will charge on your loan.

Personal data like date of birth, complete name, employment history, marital status and social security number, are available on the credit report.

On the latter part, which takes up much of the report, are more specificdata about your financial accounts including bank accounts, creditors which granted you a loan, the amount of loan granted, the overall amount of loan granted to you, the monthly dues and interest rates charged. They also provide information about delinquencies, outstanding balance, repaid balance, dates, and terms of every loan.

There is also a Public Record section on these reports. On this section belongs information like tax liens, financial interventions, and bankruptcies. Then the Report Inquiries is the part where the number of inquiries made about your credit is recorded. Listed are the organizations that have a copy of your credit reports, and other individuals or agencies that have authority to access the same.

Finally, the last section is about the disputes you may have made or the creditor may have against any information or error on the credit report.

What You Cannot Expect to See on Your Credit Report?

There are data that are concealed from creditors or any consumers who may do some inquiry about your credit. These are bank balances at the present, religion, health status, and race. Driving and criminal records are not included as well. But of course, there are creditors or their investigators can get such information from other sources like medical bills or automobile finances.

Who Can Access Your Credit Report?

The Fair Credit Reporting Act determines which individuals or entities have the right to access your credit reports. By default, there are two agencies which have granted such right—and these are you and the United States government.

Of course, there are agencies or entities which may have permissible reasons to have a look at these documents. These are your creditors such as banks, credit card company, and lenders. Even your employer or lessor may also do an inquiry about your credit reports. You have to be careful though on this aspect. If there are more inquiries made about your credit reports, they may have an effect on the reports themselves.