Now that we’ve covered what credit is, your credit score and the factors that impact it, let’s dive into credit reports. This edition of the Credit Chronicles will explore the ins and outs of credit reports, including what they are, how they work, what’s included there, and how you can obtain a copy of your report.
What’s a credit report?
As defined by the Consumer Financial Protection Bureau, a credit report is “a statement that has information about your credit activity and current credit situation such as loan paying history and the status of your credit accounts.” Your credit score is calculated using what’s listed in your credit report. However, your credit report does not include your credit score.
What’s included in a credit report?
All the fun stuff listed in “what affects your credit score.” This includes, but is not limited to:
- Payment History (the consistency of how you've paid your accounts over the length of your credit)
- Credit history (the list of businesses that have provided you credit)
- Outstanding balances (any balances you haven’t paid in full)
- Applications for new credit accounts (new credit cards you’ve signed up for, loans you’ve taken out)
- The various types of credit accounts you’ve had (mortgages vs. car loans vs. credit cards)
A credit report may also include:
- The businesses that have obtained your report within a certain time period
- Current and past names, address(es) and/or employers you might have had
- Any bankruptcies or other public record information
How are credit reports generated?
These reports are generated by credit bureaus, which are data collection agencies that are designated to receive information from your lenders and creditors. The United States has three main credit bureaus—these national consumer credit reporting companies are Equifax, Experian, and TransUnion.
These companies provide your credit information in the form of credit reports, not only to lenders and creditors to help them determine your creditworthiness but also to you so that you can better understand your credit. You’ll also have the opportunity to make sure all the information in your report is correct. Reach out to the credit bureau issuing your report to correct any inaccurate information or misspellings. It’s also important to review your credit report in order to prevent any fraud or identity theft.
How do I obtain my free credit report?
Thanks to the Fair Credit Reporting Act (FCRA), these three credit bureaus are required to provide you with a free copy of your credit report, at your request, once every 12 months. As the Federal Trade Commission notes, you can visit annualcreditreport.com or complete the Annual Credit Report Request Form.
Be careful when ordering your report and make sure that you’re ordering from the authorized annualcreditreport.com site. There are many websites that say they can provide “free credit reports,” “free credit scores,” or “free credit monitoring” but are not part of the formalized free report made available via FCRA. For more information about obtaining a free copy of your credit report, visit the FTC website on free credit reports.
Where can I learn more about credit reports?
This is just a high-level overview of credit reports, and there are a lot of great resources that can help you dive in even deeper into this topic. Here are a few of our favorites:
- FTC, “Credit and Your Consumer Rights”
- USA.gov, “Credit Reports and Scores”
- Credit Card Insider, “How to Dispute Errors and Mistakes in Your Credit Reports”
- Dough Roller, “12 Credit Cards That Offer Credit Scores for Free”
This blog post is intended for general information purposes only and should not be considered legal or financial advice.