Understanding Your Credit Report

Credit reports are similar to report cards because they score your performance on how well you manage your credit.  Only now you have more than a good scolding from your parents to fear; your “grade” could keep you from obtaining your home loan.  Only businesses with “legitimate business need” and “permissible purpose” as dictated by federal law and those you legally authorize in writing can access your report.  Businesses that qualify include credit grantors, collection agencies, insurance companies, and employers.  Contact any of the bureaus below for a copy.  Credit report fees vary depending on which bureau you choose.

Equifax
(800) 685-1111
www.equifax.com

National Consumer Assistance Center
Consumer Credit Questions
(888) 397-3742
www.experian.com

Trans-Union
(800) 888-4213
www.transunion.com

A credit report contains information on your past credit experience.  It includes identification information like your name, previous names used, employment, credit, public record information, and the names of those who have requested and received a copy of your credit report.  Your credit report does not contain information regarding your race, religion, health, driving record, criminal record, political affiliation, or income. 

Your credit report can be broken down into two components.  The first is your actual credit history including every loan you have obtained and credit cards issued along with the balances and your payment history.  It will also list any delinquencies that have been filed against you.  Check this section very closely.  Mistakes can be detrimental when figuring the second component - your credit score.  We recommend you check your credit report often so that it’s accurate when you need it.  People often learn that they are victims of identity theft and fraud only after ordering a copy of their credit report.  The last thing you want to hear when applying for a home loan is that an imposter halfway across the country funded a vacation to Tahiti on your good credit.  Carefully verify all information is correct and double check three important things.

• The credit report contains your information only, and not information of someone with the same or similar name or social security number.
• If a delinquency was reported to the credit bureaus, make sure to resolve the issue and that the resolution appears on the report.
• If you disputed a claim or late payment pattern and submitted an explanation to be included in your report (and you should), your statement of dispute should be included as part of the report.