Is A Credit Report Important?

Most of the general public knows that a credit report is an important part of your financial life but not everyone knows exactly what the report contains or how it can affect several aspects of their life. To be on the right path with your finances, you need to be aware of your credit worthiness, you also need to understand what your credit report is all about regardless of whether or not you need lines of credit or financing help.

What Is On Your Credit Report?

Your credit report will contain the vital information about you including your name, current and previous address, your phone number, and your Social Security number. This information is generated from your credit applications.

Also on your report is a listing of all accounts you have currently or in the past. It includes the name and address of the creditor, the date you opened the account, the credit limit or amount of the loan, the balance remaining on the account, the amount of the monthly payment, and the payment plan you currently use to satisfy the debt. The information is generated by the creditors who report your financial data to the three credit reporting agencies Experian, TransUnion, and Equifax. Information can be either positive such as you pay on time as agreed or negative, in that you have missed payments or made late payments on your account.

The credit report will also list information about the names and contact information for all persons who have made recent inquiries on your credit report. The credit reporting bureaus provide this data.

Consumers may also provide the credit card company with statements to dispute the account history which may be inaccurate. The statements are incorporated on the report when a consumer makes an official dispute and it has been investigated. The statements can help a lender make a decision in light of a poor credit history.

Who Can See My Credit Report?

Every consumer is entitled to receive a free credit report each year through AnnualCreditReport.com. A credit score is not included and must be purchased separately. Consumers can also request a copy of their credit history at any time for a fee. In addition to individual consumers, any business or persons who have a legitimate business reason for viewing your credit report can view the information. This information gives lenders insight as to where else you may be applying for credit.

Reporting Timeline

Creditors report the account activity each month to the credit reporting bureaus. Information that is positive is listed on the report for an indefinite amount of time. Negative information typically remains listed for seven years except for bankruptcies which stay on the report for 10 years and unpaid tax liens stay for 15 years. Inquiries into your credit history will show up for a two year time period.