Reading your credit report is not hard if you know what is in your credit report.
The credit report is broken down into four sections.
- identifying information
- credit history
- inquiries
- public records
You should first know that your three credit reports are most likely not identical.
Lenders, credit card companies, and other businesses voluntarily provide information to credit bureaus.
“How to read your credit report” is really important to protect your personal information.
As a result, they may only provide your information to one agency, two, three, or none at all.
That is why reviewing and understanding all three of your credit reports is critical.
1. What is Identifying Information in Credit Reports?
Your credit report’s identifying information section is simple.
It is created from the information you provide when applying for credit.
- your name
- your current address
- one or more of your previous recent
addresses - your phone number
- your Social Security number
- your driver’s license number
- your birth date
- your spouse’s name
- homeownership information
- your income
- your current employer
- your previous employers
Don’t be surprised if you find more than one spelling of your name or even more than one Social Security number in this section.
It’s simply because the information was misreported.
2. What is Credit History in Credit Reports?
The credit history lists your accounts with various lenders, retail stores, and credit card companies.
It also lists other businesses, as well as accounts on which you are listed as an authorized user (for example, your spouse’s credit card).
It contains the account numbers for each account, which may be scrambled for security purposes.
There may be multiple account numbers for the same creditor.
This could be because you moved or because your creditor assigned you multiple account numbers.
This is not necessarily causing alarm.
The payment history section does provide a lot of information, including:
- when you first opened each account.
- account type: installment account, such as a home or car loan, or revolving account, such as a Visa or a gas credit card.
- whether it is solely in your name or in partnership with someone else.
- the credit limit, the loan amount, or the highest credit card balance.
- the fixed monthly payment amount, such as on a car loan, or the variable minimum monthly payment, such as on a credit card.
- the remaining balance.
- whether any payments were missed or late.
If your account is past due, the report may imply that it has been referred to a bill collector.
That makes a difference; a “sent to collection” account is a much bigger black mark on your credit score than a late payment.
You might also come across information about closed or inactive accounts.
These can stay on your report for seven to eleven years, depending on how the account was paid—or not paid.
The credit history section of the credit report is critical to check because your information may be not correct.
3. What are Inquiries in Credit Reports?
When someone looks at your credit history, credit bureaus keep track of it.
Lenders, landlords, credit card companies, service providers, and insurance companies conduct these inquiries.
These inquiries will be recorded on your credit report for one to two years.
There are two types of inquiries: hard and soft.
The consumer version of a credit report includes both types.
But the business version only includes hard inquiries.
A hard inquiry is usually generated by any credit application or application to lease an apartment.
Soft inquiries involve your own credit report request and job-related demands.
Companies that have received your information for marketing purposes will appear in the soft inquiries section, but they have not seen a copy of your credit report.
4. What are Public Records in Credit Reports?
Many kinds of events are a matter of public record—that is, you can find out about them if you go to your local courthouse.
These kinds of situations may appear on your credit report in this section. They could include:
- bankruptcies
- tax liens
- foreclosures
- court judgments
- overdue child support
5. How to opt out of the marketing list and pre-approved credit card?
Credit bureaus frequently provide your contact information to companies that market to consumers with specific credit histories.
Credit card companies that send out pre-approved card offers to fall into this category.
You can opt-out of having credit bureaus sell your name to credit card companies and other businesses.
You can also call 888-5-OPTOUT (1.888.567.8688) to have your name removed from the big three bureaus’ mailing and telemarketing lists.
To opt out for a period of five years, visit optoutprescreen.com.
The phone number and website are operated by the major credit bureaus.
To permanently opt-out, visit optoutprescreen.com or call 1-888-5-OPT-OUT (1-888-567-8688) to begin the process.
Once you’ve started the process, you’ll need to sign and return the Permanent Opt-Out Election form (which you can get online).
When you call or visit optoutprescreen.com, they will request personal information such as your name, address, Social Security number, and birth date.
The information you provide is kept private and will only be used to process your opt-out request.
6. What’s not in your Credit Report?
Your credit report does not include information about:
- savings or checking accounts.
- bankruptcies that are more than 10
years old. - driving records.
- criminal records.
- medical history: medical bills may appear as debts on your report.
- debts that have been charged off or sent to collections that are more than seven years old.
- gender.
- ethnicity.
- religion.
- political affiliation.
It is good to learn how much information about your life is available to creditors and even companies looking for new customers.
It may be even more surprising to learn what isn’t in your credit file to help you take advantage.
Knowing how to read your credit report is an important step to understanding and protecting your credit score to build wealth.
