Credit Reports
Who rates your credit and why is it important? Get a grip on the basics and
credit standings whether you are establishing credit for the first time or
rebuilding your credit.
Your personal credit report:
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Federal district bankruptcy records and state and county court records of tax
liens and monetary judgments. This information comes from public records.
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Specific information about each account, such as the date opened, credit limit
or loan amount, balance, monthly payment and payment pattern during the past
several years. This information comes from companies that do business with you.
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The names of those who have obtained a copy of your credit report. (On your
copy of your Experian credit report, addresses are included.) This information
comes from the credit reporting agency.
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Your name, current and previous addresses, phone number, Social Security
number, date of birth and current and previous employers. Your spouse's name
may appear on your version of the credit report, but it will not appear on the
version that is provided to others. This information comes in part from your
credit applications, so its accuracy depends on your filling out the forms
clearly, completely and consistently each time you apply for credit.
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Statements of dispute, which allow both consumers and creditors to report the
factual history of an account. Statements of dispute are added after a consumer
officially disputes the status of an account, the account has been
reinvestigated, and the consumer and creditor cannot agree about the account
status. Both the consumer's and creditor's statements of the account status
will appear on the credit report.
CORRECTING ERRORS ON YOUR CREDIT REPORT
It’s a good idea to check your credit reports from time-totime to make sure all
information is accurate. Errors can, and do, occur. A good time to check your
reports is before applying for a mortgage, auto or other loan. Correcting
errors beforehand will make your loan application process much easier. If you
have been denied credit and have not reviewed your credit reports, you should
do so to make sure they are accurate. You are entitled to receive a free copy
if you were denied credit.
When you find something wrong on your credit bureau report, you have the right
to challenge it. Submit your challenge in writing to the credit bureau, briefly
explaining the issue. Include copies (not originals) of any documents that
support your position. By law, the credit bureau must include this in your
file, investigate your complaint (unless they consider it frivolous), and
either verify the item in question or remove it from your file. At your
request, the credit bureau will send a corrected copy of your report to anyone
who received it in the past six months.
How long does information stay on your credit report?
Positive information stays on your credit bureau report indefinitely, although
information about an account comes off after about seven years if no new
information is added. Negative information, such as late or inconsistent credit
payments, will stay on your credit report for at least seven years, as does
public record information such as tax liens and delinquent child support
payments. Bankruptcies, foreclosures and judgements can stay on your credit
bureau report for up to ten years, and information regarding a criminal
conviction has no time limit. Most inquiries stay on a credit report for up to
two years.
Is your credit bureau report private?
Federal law carefully regulates how credit reports can be used and by whom.
Businesses must meet certain requirements before they can access consumer
credit information. These requirements usually include:
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Proof of a permissible purpose under federal law
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A background check and on-site inspection of the business
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A current business license
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A signed contract requiring the business to use the data properly
WHAT ARE CREDIT BUREAU REPORTS?
Lenders generally don’t have the time to personally investigate credit
histories. Instead, they rely on credit reports from one of the credit bureaus
that collect and sell this information.
A credit report is essentially a "report card" on how you have handled
credit in the past. Credit reports contain four types of information: identifying
information, credit information, public record information and inquiries.
Identifying information
This includes:
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Your name
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Your current and previous addresses
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Your Social Security number
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Your year of birth
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Your current and previous employers
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If you’re married, your spouse’s name
Credit information
This includes credit accounts or loans you have with:
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Banks, finance companies or credit unions
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Retailers
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Credit card issuers
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Other lenders
Public record information
This includes any information that’s contained in
state and county court records, such as:
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Bankruptcies
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Tax liens
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Monetary judgments
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Delinquent child support
Credit inquiries
These indicate to other lenders that you have applied
for new credit (which could result in
additional debt). Potential lenders view multiple
recent inquiries on your credit report as a
sign that you may be overextending yourself.
Other areas of interest:
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