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Credit Report
What is a credit report?
A consumer credit report is a document that contains a factual record
of an individual's credit payment history. It is mainly used to judge
his/her credit worthiness by lenders.
The credit report not only lists basic information such as your name
and social security number, but other information pertaining to your credit,
especially your borrowing and repaying habits. Basically, it shows how
you treat credit and your relationships with creditors.
As people pay their bills, most lenders report credit payment history
information to credit bureaus.
Your credit can determine what you can buy, what type of car you drive,
and even where you can live. It is important to maintain the best credit
report possible. Each person should check his or her credit report and
make sure it is correct.
What does a credit report contain?
Although the style, format and coding may be different depending on which
credit reporting bureau is used, the typical person's credit report includes
four of the following types of information:
- Personal Information
Your full name, nicknames, birth date, social security number, and current
and previous addresses and employers. This information comes from any
credit application you have completed.
- Public Record Information
Any relevant court records, such as legal judgments, tax liens, bankruptcies,
or, in some states, overdue child support. This information comes from
public records.
Bankruptcies can remain on your credit report for up to 10 years. Other
public record information can remain for up to 7 years.
- Credit History
A snapshot of your past actions. The report lists all loans and credit
lines in your name from recent years. Reports vary from bureau to bureau,
but generally they show the type of loan, the date you began the loan
or opened the credit line, the amount of the loan or credit limit, the
amount you still owe, and your payment pattern. For example, the report
may list the number of times you've paid late, including the times you
were more than 30, 60, and 90 days late. This information comes from
companies that do business with you.
Most information, whether positive or negative, remains on your credit
report for 7 years from the date it is first reported, and then cycles
off automatically. If there is inaccurate information in your credit
report, you have the right to dispute it and have it removed.
- Inquiries
A list of those who have obtained a copy of your credit report within
the past two years. Inquiries indicate to other credit grantors that
you have applied for new credit that could result in additional debt.
Potential lenders view multiple recent inquiries on your credit report
as a sign that you are overextending yourself. It's common for a potential
lender to turn you down because of "excessive inquiries."
This information comes from the credit reporting agency. Most inquiries
stay on your credit report for up to two years
The Credit Reporting System
The modern credit reporting system helps credit grantors approve loans
and credit in minutes. The system provides continuously updated information
to make fast, accurate decisions dealing with almost all consumer credit
transactions. The credit reporting system benefits everyone. Consumers
with a credit record reflecting prompt payment find it comparatively easy
to open new or expanded credit lines.
The credit reporting system:
- Opens new opportunities to obtain credit
- Speeds credit decisions
- Makes our credit-based economy possible
To get a copy of your credit report, click HERE.
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