First, understand that the credit report your bank receives will be different from the “consumer oriented” credit report you’ll get when you access your own files.
Consumer oriented credit reports are longer and contain more detailed information, making it easier for consumers to learn how to read their own credit reports.
A credit report is divided into 4 categories of information: identifying information, credit history, public records and inquiries.
The identifying information will include your name, your current and previous addresses, your date of birth, telephone numbers, driver license numbers, your employer and your spouse's name. This often contains errors, such as misspellings of your name. This is not important unless you see that “you” are married to the wrong person, living somewhere that you have never lived, or work somewhere where you have never worked.
Those are signs of identity theft and should be investigated.
Your credit history is of prime importance to creditors. This section will include:
· The type of credit (mortgage or car loan, credit cards, etc.)
· Whether the account is in your name alone or with another person.
· Total amount of the loan, high credit limit or highest balance on the card.
· Your current balance.
· Monthly payment.
· Status of the account (open, inactive, closed, paid, etc.).
· A record showing the timeliness of your payments
Some credit reports show timeliness as a letter or number, others tell it in plain English: “Pays as agreed,” “30 days late”, “charged-off,” etc. If your report shows a letter or number, look for the “legend” to see what each means.
Accuracy of this section is important to your credit scores, and inaccuracies could signal identity theft. Read it carefully.
Public records lists bankruptcies, judgments and tax liens.
The Inquiries section shows who has asked to see your credit report. Inquiries are reported in two sections: hard and soft. A hard inquiry indicates that you have applied for credit, so seeing an unknown name in that section could indicate identity theft. Soft inquiries are those that creditors make in anticipation of sending you an offer of credit, or those you make yourself.
Only hard inquiries affect your credit score.
Take the time to read and learn how to read credit reports, so that you can spot mistakes quickly and put a stop to identity theft if your accounts have been compromised.
