How To Read and Understand a Credit Report

A credit report contains a lot of important information related to the credit that you use. It provides an inside look in to how a creditor views your risk worthiness. Reading a credit report for the first time can get a little confusing. Here are the common aspects of a credit report that you should be familiar with.

Personal Information:

This section contains your personal data such as name, address, previous employer etc. A credit report usually contains all the name variations that have been reported to it by the various lenders. This will also include the spelling mistakes made either by the lender or by you during the filing of the application. The same holds true for the address. You should check this section in order to ensure that correct personal data is being reported. This section can also tip you to identity theft if unknown names are recorded. All name variations are maintained on the credit report in order to link various accounts to your credit report. While current and previous employers may be listed, this section is not meant to be a complete record for of your employment. It is not necessary that your current employer or all of your past employers will be listed.

Personal Credit Report

Date: 19/02/2010

Name: XXXXXX
Also Known as: xxxxxxxx
Address:

214c Emily Way, OH-44281

456 Garden Road,

CA 55434

Current Employer:
Previous Employer:

Credit Summary:

All accounts are mentioned in the credit summary section. This section will show you all the major information that at a glance about your credit accounts. It is generally divided in to revolving accounts such as credit cards and lines or credit, loan accounts such as mortgage and automobile loans, collection accounts, delinquent accounts and other kinds of loan and credit accounts. The summary will show at a glance the current status of the account, whether the account was late in the past, name of the creditor and public records such as tax liens, filing for bankruptcy, federal and local court judgments as well as the number of enquiries that have been made in to your credit report in the past two years.

Account history:

This section will have all the possible details associated with a particular account. Your must go through this section carefully to determine that the data being reported is accurate. The credit history section will have the following information:

  • Creditor: the name of the lender or the lending institution.
  • Account Number: this is the account number of the credit account in question, be it a credit card account or a loan account.
  • Account type: this specifies where the account is a revolving account, a mortgage, automobile loan, educational loan etc.
  • Responsibility: this section whether the account is a single account, joint or an authorized account thus implying who all have the primary responsibility in making the payments and maintaining the current status of the account.
  • Monthly payment explains the minimum payment you are required to pay on the account each month.
  • Date opened and date reported: this section gives the date when the account was first opened and date reported gives the last recent date when the creditor updated the information with the credit bureau.
  • Balance: the balance at any time is the amount that remains to be paid to the creditor. For a mortgage loan this will reflect the total amount of the loan minus the payments that have been made while for a credit card account, this will reflect the amount you have charged in a month.
  • Credit limit is the maximum limit that you can charge to the credit account.
  • High Balance : this is the highest balance that you have ever had on your credit account. For loan accounts the highest balance will be the original sum that you borrowed.
  • Past due: any amount that was past the due date of payment during the time of reporting.
  • Remarks comments that have been made by creditors regarding your credit account.
  • Payment status: this section indicates the status of the account whether it is current, was past due or has been charged of. Even if the account is current in the present state it might contain information as to whether it was due or late in the past.
  • Payment history indicates the monthly payment status since the time the account was reported to the credit bureau.
  • Collection accounts: the collection accounts section may appear on your credit history or in a separate section depending upon the credit reporting company. These are the accounts that have been written off by the lender and have been sold off to a collection agency.

Public records:

this section includes information regarding your credit that can be found on public records such as federal and small court judgments, filing for bankruptcy is and tax liens. A public record containing negative information about your credit can severely damage your credit rating. A tax lien can remain on your credit report for a period of 15 years while filing for bankruptcy can stay on your credit report for a period of seven to 10 years.

Credit enquiries:

this section contains a list of all the entities that have made an enquiry into your credit report. Your personal copy of the credit report will contain both the hard and soft enquiries from creditors as well as others such as employers and landlords. However the credit reports that is provided to creditors will only contain the hard enquiries that have been made as a result of you applying for credit or a loan.