Your credit report has a big impact on your life. It is used to make important decisions concerning your ability to rent an apartment, get a job, obtain insurance and, of course, to qualify for a credit card. Your credit report is a gold mine of information about your previous financial experience and skills to manage credit wisely. Errors in the credit report can lower your chances to make a profitable deal. If you want to avoid unpleasant surprises, make sure that your credit report is accurate and up to date.
The credit report contains information about your credit activities: the record of your payments, the list of credit cards or loans you have had before, the current balances and credit limit. Then, there is personal information: your full name, date of birth, current and previous addresses, SSN, current and past employers. Generally, your credit report does not contain information about the credit card debts or defaults that are more than 7 years old. Notice of bankruptcy is listed for 10 years.
Credit reports are made up by consumer reporting agencies. The largest ones in U.S. are Equifax, Experian and TransUnion. Credit bureaus do not make a decision whether you are creditworthy or not. They only gather the information about your credit history and pass it to a potential lender. Your good credit report is your best reference for getting credit.
Errors in credit reports happen from time to time. For example, you can find that there are accounts held by a person with the same name. It is not a part of a conspiracy against you; the confusion occurs because credit bureaus gather much information from different sources.
The best way to determine if you have any errors in your credit report is to order a copy of it and check the information carefully. You can receive one free credit report every 12 months from each major credit bureau. Just contact the companies through official sites or make a direct request by phone or by mail. Keep in mind that the content of your credit report from each bureau can vary due to the delays in reporting or updating information. So if you want to make a thorough analysis, request the copies from all 3 credit bureaus.
If you find an error or inaccuracies in your credit report, contact the consumer credit reporting agency immediately. The company will investigate your claim. If they find the proof of your words, they will change incorrect data. If they didn't, you have the right to write a short explanation (about 100 words) and ask to attach it to your credit file. Anyone requesting a copy of your credit report will also automatically receive your statement.
Checking your credit report, do not forget that the best way to keep it positive is to make on time payments and do not max out your credit line. You cannot correct your bankruptcy or defaults if they really happened. A good accurate credit report is the best proof of your creditworthiness and reliability.
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