Credit reports and scores are produced and maintained by 3 credit bureaus or credit reporting companies. They contain information about most of your credit-related transactions. Information contained in your credit report is offered by your creditors to the credit bureaus regularly.
Details in your report may be utilized by those thinking about extending you credit, leasing to you, hiring you for a job or providing insurance coverage. Access to your credit details is regulated under federal law. For more information about the federal Fair Credit Reporting Act, go to the Federal Trade Commission’s web site at www.ftc.gov.
There are four parts to the typical credit report:
- Identifying information, including your name plus other names you have gone by, your birth date and Social Security number, existing and previous addresses, companies and positions held.
- Credit history details including a list of your loans, charge cards and other charge accounts, including amount obtained, balances due and a history of the timeliness of your payments. This area may also include details about collection action taken against you for late or non-payment. Credit history details may remain on your report for seven years.
- Public record details noting any legal judgments against you, defaults or bankruptcies. Public record details might stay on your report for up to 10 years.
- Inquiries revealing a list of creditors or other parties that have requested your credit report. This will certainly include lenders to whom you have actually gotten credit. It may also include existing lenders wanting to monitor your creditworthiness and companies interested in making you an unsolicited credit offer.
There are three major credit reporting bureaus running across the country. It is likely that a separate credit report on you will be maintained by each of the three firms. It is likewise possible that the information included in each report might vary. The 3 agencies are TransUnion, Equifax and Experian.
It is suggested that you get a copy of your credit report from all three bureaus a minimum of once a year. New federal regulation consisted of in the Fair and Accurate Credit Transactions Act (FACT Act) mandates that each bureau supply you with a complimentary copy of your report every 12 months. To find out more and to ask for a copy of your credit report under the FACT Act, check out www.annualcreditreport.com.
You could also get a free copy of your credit report if any details included in your report caused you to be denied credit. Usually, you have a limited time to ask for a complimentary copy of your report following notice of credit denial. The written credit denial notice must specify which credit bureau was used and what the time limitation is for requesting your free report.
Analyzing Your Free Credit Reports From All 3 Bureaus
When you get your credit report, evaluate all the details thoroughly. Regardless of best intentions, errors can be made. In addition, examine your credit report for any signs of identification theft. Your credit report will come with instructions for disputing details. It’s essential to search for the following:
- Are all the accounts provided yours?
- Is your payment history reported properly? You can contest any payments shown as late if they were really paid on time.
If you discover incorrect details on your credit report, inform the credit bureau in writing. Normally, a form will be provided for this function when you receive your report. In addition, contact the company that reported the incorrect details and request that they correct their records. Do this in writing. Send your correspondence by certified mail and always keep a copy for your records. The Fair Credit Reporting Act requires that credit bureaus investigate your grievance within a specific amount of time and respond to you in a timely manner.
Free Credit Scores From All Three Bureaus
Credit bureaus and lenders calculate a credit rating based upon details included in your credit report. Getting a FICO credit score is a common practice albeit an outdated one. The two primary factors in calculating your credit score are how you pay your debts and how much you owe. The function of a credit rating is to help lenders determine the risk involved in extending you credit. The better your score, the more likely you will be extended credit at a reasonable interest rate. Yes, credit reports and score, especially, can vary from one source to another given that different scoring systems may be used. One of the most commonly used by lenders is a system developed by Fair Isaac and Company called the “FICO score”.
You may get your credit score directly from the credit bureaus for a nominal fee or from reputable credit scores from all 3 bureaus sites for free with trial offers. You will certainly likewise have the ability to acquire your score from the lender with whom you are working. Obtaining credit reports and score annually is critical to knowing your overall financial health.