Facts About Your Credit Report

By: Michael Millington

Your credit report is a detailed collection of your credit history. It contains all the information that influences your credit score and, therefore, your credit worthiness. There are many items that contribute to a credit report. Some items are personal information while others are financially sensitive. Each piece of information is unique to you and should accurately reflect your credit history. Even though your credit report is free to look at once a year, many people have no idea of what they should be looking at.

 

Credit Report Items

Simply put, the items on your credit report are very straightforward. The information will only change if you supply different information to a lender on an application. This applies to your personal information, like your home address and full name. Other items of information will also be present on your credit report, like your social security number, date of birth and employment information. These items have no impact on your credit rating.

The items on your credit report that influence your credit rating are known as trade lines. These items are the accounts your lenders report to the various credit bureaus. The pertinent information reported includes what type of credit account was opened, the date the account was opened, the credit limit (or loan amount), and the active balance on the account. If you’ve already begun to make payments on the account, a payment history will be present as well.

The remaining items on your credit report would be any credit inquiries you’ve made and any public recordings that have been made against you. Your credit inquiries are separated into two categories: voluntary and involuntary. Voluntary requests are the requests you initiate yourself, while involuntary requests are initiated by lenders looking to offer you credit (i.e. pre-approved offers). Lastly, any public records, collections, bankruptcy filings, rulings and other legal matters are also listed on your credit record.

 

How Do These Items Affect You?

The items on your credit record affect you in various ways. As mentioned earlier, personal information does not impact your credit record. However, as with anything on your report, you should always check to make sure the information is accurate. Having incorrect personal data might lead to other pieces of information being incorrect.

Your credit is majorly affected by your trade lines, mainly due to the fact that they are reported to the three credit bureaus. Keeping track of the accuracy of these items is crucial towards maintaining a healthy (if not, accurate) credit rating. Any odd or wrongful additions can damage your FICO score and cause you to suffer for it. Any irregularities should be reported to your credit bureaus immediately. The longer a negative mark stays on your credit report, the worse damage you’ll end up incurring for yourself.

Mistakes made on a credit report can be a sign of anything from employee negligence to identity theft. Checking your credit report can alert you to issues that may stem from criminal activity by others. Having an updated credit report can help to reverse any damage incurred from identity theft. Though you can only get an updated credit report once a year for free, you can still make sure that any changes to your credit can be reported through your lenders. Make them aware that any changes should be reported as soon as possible.

 

Credit Report & Credit Score

One thing you will not find on your credit report is a credit score of any kind. While the two are related, your credit report will give you much more detailed information on your credit history than your credit score might be able to provide. You score is a numerical representation of your credit worthiness. In the most recognizable formats, the higher your credit score, the more attractive you look to lenders and credit providers.

In general, there are three main credit scores that lenders look at when determining credit worthiness. These credit scores come from the three main credit reporting bureaus: Equifax, TransUnion, and Experian. These scores are known as FICO scores and fluctuate with the changing information on your credit report. Each of these scores is dependent on the credit report of that individual credit bureau. For this reason, not all credit scores will be alike as each bureau might have varying information.

FICO scores are used in 90% of all credit related processes and are the most popular scores to request. However, there are other, lesser known credit scores that utilize the information on your credit reports in a different manner to get their numbers. Although these extra scores are used for determining credit worthiness in some instances, they are not as frequently used as FICO scores are. Requesting your FICO score may give you the greatest chance of accurately portraying your credit worthiness.

 

Your credit report has a lot of important information that you should be aware of at all times. Much of this information revolves around your credit. If you have outstanding debts, accounts going to collection or multiple maxed out credit cards, your credit report will only reflect negative information. Consider eliminating that negativity from your record with debt settlement from Guardian Debt Relief. We can help put you on the track towards debt freedom and help you get your finances back in control. Call one of our debt specialists for a free consultation. You have the power to rewrite your credit report. Take the first step and contact Guardian Debt Relief today.