How To Read Credit Reports
Why is it important to learn how to read credit reports and understand what they say about your credit history? Your credit report ultimately determines whether credit will be extended to you or not, and the terms you will have to pay.
Lenders usually check your 3-in-1 Credit Report, which is the most complete picture of your credit history available. With data provided by all three national credit bureaus (Experian, Equifax, and Trans Union) lenders can get the full story on your payment history.
Learning how to read credit reports is also important because you need to make sure the information in your credit file is accurate. Information on most credit reports contains details for the duration of any credit accounts you have ever had (which can go back many years), so it's really important to check for errors. Some things to check for are:
- information from someone with the same name as you
- possible credit card fraud or identity theft
- debts that have actually been paid off, but still show a balance due
- personal information that is incorrect or that has changed.
Below is a sample of a TransUnion credit report detailing the various sections of the report. Equifax and Experian offer similar information.
Personal Information
Your Full Name:
Other Names: (including maiden names and other derivatives of your name)
Current Address
Telephone Number(s)
Employment Data Reported
Employer Name:
Position:
Hired:
Date Reported:
SSN: (Your social security number)
Date of Birth:
Previous Address:
(Any previous addresses that may be on file, and the date that they were reported)
Spouse's or co-applicant's name
Make sure the information contained in this section identifies you and not someone else. If you see mistakes in this section, such as an address listed for someplace you have never lived, it could be a sign that someone else’s credit history is being linked to your report. It may also indicate your identity has been stolen, so pay close attention to the rest of your report. You need to request the incorrect information be removed, because previous addresses can be used to verify your identity when you pull future credit reports.
Public Records
Type: (What type of public record)
Reference Number: (to look up the records)
Court: (Where the information is filed)
Status: (Paid or current)
Date Filed: (When the record was filed)
Responsibility: (Joint or individual responsibility)
Plaintiff: (Who filed the record)
Amount: (How much is owed)
Release Date: (Date it was paid off or when it will be paid off)
Remarks:
Public record items are obtained from local, state, and federal courts. Currently, only bankruptcy will appear in the public records section of your credit report. Prior to 2018, public records also included foreclosures, repossessions, collections, civil judgments, and tax liens. (There is the possibility tax liens and judgments may be added back to the public records section of credit reports in the future.)
You need to make sure all the information in this section is correct, as bankruptcy information will have a major impact on your credit score for a long time. Bankruptcy records can stay on your report for 7 to 10 years, depending on the type of account.
Special Messages
This section can contain consumer statements explaining why you disagree with information that has been disputed, fraud alerts, and ID mismatch alert (if the SSN, surname or address does not match what is on file).
Account Information
Issuing Bank and Account #
Address of issuing bank
Responsibility: (individual or joint, authorized user, co-signer, terminated, etc.)
Loan Type: (real estate, credit card, finance, auto loan)
Account Type: (mortgage, revolving, installment, collection)
Date Opened: (when this account was established)
Pay Status: (paid, paying as agreed, delinquent)
Current Balance:
Date Updated:
High Balance:
Credit Limit:
Terms: (Credit card minimum payment, mortgage payments, or loan payments)
Late Payments: (Number or times that you have paid 30, 60, and 90 days late for the history of the account)
Remarks: (if the account was closed at the consumer's request or if a credit card was lost or stolen)
Record of payment recorded for previous months
Carefully look at the accounts listed and whether the on time payments recorded are correct. Late payments (especially recent ones) can really ding your credit score and you can dispute it if the information is not correct.
Inquiries
Company
Address of company
Phone number:
Date Requested:
Promotional inquiries are companies that receive limited information about you so that they can make an offer of credit or insurance. They don't receive your full credit report, and these inquiries do not affect your credit score.
Personal inquiries and credit monitoring services also do not affect your credit score.
Hard inquires occur when you apply for credit with a company. It's important to pay attention to the hard inquires because too many hard inquiries can hurt your credit score. It can also tip you off that your identity has been stolen if you don't recognize the lenders listed.
Resolving Inaccurate Information on your credit report:
If you find errors on your credit report, you can start an investigation to correct the information. The following article on fixing a credit report mistake can help you get the process started.
Now that you understand how to read credit reports, the following articles can give you more helpful information to help you manage your credit:
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