How To Read Your Credit Report

Experian, Equifax and TransUnion are the three major credit agencies and each American have the right to a free credit report every year from each of them by the Fair and Accurate Credit Transactions Act, signed into law on Dec. 4, 2003. The law does not give permission to every American to read their credit report. Not one word in the law says the credit departments have to write it in simple, easy to follow language. Simply go to www.ftc.gov and click on customers then credit and read it for you. Hopefully you’ll stay wide-awake.

While all follow a basic format, some credit reports vary so what you are going to read doesn’t apply across the panel. If you didn’t get it directly from one of the department mentioned above, your best bet for a conversion is the source providing your copy.

Here is the four-part framework, which is used by most departments. First part is your identifying information. This information would be like your name, social security number, current address, date of birth, previous addresses, driver’s license number, telephone number, spouse’s name as well as your employer and length of service. As with all sections, pay close consideration because chances are pretty darned good, some thing of it is wrong.

This info comes to the agency from a myriad of sources so it may be wrong as well as the department doesn’t take the time to revise or correct it. That leaves you, as you are your own correcting agent.

 This is where the departments list if you are late, and if late, how often you’ve been late as well as how late. It will show you pay on time if you are not late.

Third part is called Public Inquiries or Public Records. This is where tax liens, foreclosures, judgments as well as bankruptcies are listed. You desire this part to be blank and I do connote blank. If you see something here, attempt to correct right away if not earlier.

Fourth part is the Inquiries section. This part is divided into two parts. First part is the inquiries you begin by filling out a credit application. Generally this section is referred to as the hard investigation section because you are the initiator of the investigation.

The soft inquiry section is the second part. You’ll find here the names of companies who have sent you offer of credit or present creditors who are monitoring your account.

Every so often there is a fifth section called Remarks. Read it because you never know who reported about you and what it is.

Usually on the backside of the report pages each credit report department places a clarification of terms. In it, they give details of what the numbers and letters you see next to your accounts mean. So, if you see anything like I9, don’t worry, as it should be defined in the clarification of terms.
Of course, I9 could be negative, so you may have to worry. What’s more now, you are almost completely armed to deal with that free credit report the law said the department had to give you.

May all your credit be A+ Good luck!

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