Get to Know Your Credit Report

Everything You Need to Know

One of the best things you can do for your financial health is to review your credit report every year. You’re entitled to a free report every twelve months from each of three credit bureaus – Experian, TransUnion and Equifax. But for many, getting the report is easy, it’s trying to decipher it which is the challenge. If you don’t know what you’re looking for, your credit report can look like nothing but a jumbled mess of numbers, figures and financial jargon. But with a few helpful hints and tricks, reading your credit report will be a breeze!

While each of the bureaus may format their reports differently, they should all include the same basic information:

  1. Report Summary. This is exactly what it sounds like – a basic summary of your credit report. It will list information such as accounts in good standing and potentially negative items.

  2. Personal Information. This will include a record of your name, address, birthday, employer and telephone number. While it’s not a huge concern if the information isn’t current, it is best practice to keep it up to date. If you need to make changes you can submit them through your creditors or to the credit bureaus directly.

  3. Accounts in Good Standing. This section will list all your accounts that have not been defaulted on or gone to collections. If you’ve made all your payments on time and have paid off at least the minimum due every month, your accounts will be in good standing.

  4. Potentially Negative Items. These are things that could potentially have a negative effect on your credit – negative accounts, accounts that have gone to collections and public records. Negative accounts are accounts that haven’t been paid on time as agreed, accounts gone to collections are accounts that were sold to a collections agency and public records include documents such as bankruptcies, liens and judgements. Potentially negative items will usually stay on your credit report for seven years.

  5. Record of Requests. In this section, you’ll see records of both hard and soft inquiries. Hard inquiries occur when you authorize a prospective lender to check your credit report before making a lending decision. These inquiries can negatively impact your credit and will typically stay on your report for two years. A soft inquiry occurs when a person or company checks your credit report as part of a background check. Soft inquiries can occur without your permission but will not negatively impact your credit. 

Once you know how to read your credit report, you’ll be one step closer to peak financial fitness. If you’d like to request a copy of your credit report you can visit www.annualcreditreport.com, call 877-322-8228 or contact the three credit bureaus at the numbers listed below:

  • Experian: 1-888-397-3742
  • Transunion: 1-855-681-3196
  • Equifax:866-640-2273