Tips For Reading A Credit Report

There are credit reports on nearly everyone. What you do that involves credit is put on your credit report, even a department store card. So chances are you have a credit report. You may want some tips for reading a credit report. There are 3 great tips for reading a credit report.

1. Read all three reports from the three different credit-reporting agencies.
2. Know any abbreviations that may help when reading.
3. Know what really matters on a credit report.

First, read all three credit reports from the three major credit-reporting agencies. The agencies are Experian, TransUnion and Equifax. A lender or creditor has the choice of which agency they report to. They will most likely not report to all of them and once in a while a lender will not report to any reporting agencies. It is possible to get the three reports all at the same time by going to an online company that helps you obtain the reports. You can go to annualcreditreport.com and get a free credit report every twelve months.

The three different credit-reporting agencies will have their reports a little different. They have the same information like the account number, date opened etc., but the three reports will have different ways to show the information. Some will just write it all out and you can read through it. Others will have abbreviation like numbers and letters to represent information about the account and is status.

Second, know what the abbreviations mean. Experian will have the information on the credit report written out in plain English. You will be able to understand what is written about you and your accounts. They may say things like the account is current, or delinquent. Then there are some letters for the other companies and some times Experian that will represent the status of the account. For example there may be a letter for the account type. An “M” will stand for mortgage. An “R” will stand for a revolving account, like a department store card.

Then there are letters that may represent who holds the account. The letters will indicate if the account is just you or if you have a joint account with your spouse or if you are a co-signer. If it is an individual account there will be an “I”. For a joint account there will be a “J” and so on. The credit reports may just say joint or shared.

All these letters will not be together for you to try and work through them. They are in their respective columns and there will be a heading at the top of the column for the accounts you have on your credit report.

There will most likely be some numbers in along line on each of your account lines. These numbers you want low. They will range from 0-9 and a 0 or a 1 indicates that you have always paid on time and you are not behind on payments. A 9 will show just the opposite and the scale in between is the varying degrees of a payment history. Each account is given a number for each month the account is opened. So on a 30–year mortgage that you have had for 20 years you will have a long line of hopefully 0’s or 1’s.

Third, read the main part of the credit report. There are four main parts to a credit report. The first section is the identity section this identifies who you are. Then there is the credit history section, which is where you want to spend your time reading. The next section is the foreclosure and courthouse section. This will hopefully be left blank, but if not you will still not spend too much time on this section. The last section is the inquiries section. This section just lets you know who has inquired about your credit history.

So three good tips for reading a credit report are first, read all three reports for the three major credit-reporting agencies. Second, know what the abbreviations mean if there are any. And third, spend your time reading the main part of the credit report, where your credit history is laid out for you for all the accounts you have.