How to Read Your Credit Report

How to Read Your Credit Report

You have researched credit reports and scores, with the help of the Finance 101: Credit Reports and Scores article, and ordered your free annual credit report. Now you have your credit report, but how do you read it? That’s where the CGS Team comes in.

If you ordered your credit report from each reporting agency, then make sure you are comparing to ensure each agency has the same or most accurate information. If you have a combined report, you will be able to see information relative to each agency on one document. You should be comparing in this case, as well.

Your credit report is set up in four main sections: Personal information, Credit or Account History, Public records, and Credit inquiries. Review each section carefully to confirm your credit report is accurate and no sign of fraud.

We are going to cover each section. Depending on where you ordered your credit report, they may not be in this exact order.

Section 1: Personal Information

This section includes your personal information as it appears in your credit file. This information consists of your name (or AKAs), Date of birth, SSN, recent addresses (typically the 3 most recent), and your current or previous employers. Unless you move or switch jobs, this information is not very likely to change.

Section 2: Credit or Account History

This is the largest section of your credit report. This section will list every credit account you have, open or closed within the last 7-10 years.

Each individual account will list the account name or creditor, account number, account type (installment, revolving), account status (open, inactive, paid or closed), monthly payment amount, total credit limit, total credit used (balance), and how well you have paid the account in the past 24 months.

A collections account may also show in this section, or in the public record section.

Section 3: Public Records

This section will provide information on any liens, financial judgments, wage garnishments, overdue child support or alimony, foreclosures, and bankruptcies. Hopefully this section is empty, as it can hurt your credit score.

Section 4: Credit Inquiries

This section will list the names of the companies who have requested and obtained a copy of your credit report. This is usually any company or lender you may have applied for credit with.

The credit inquiries section also includes any landlord, insurance company or bill payment company who has requested your report. This section will tell you who obtained your report and when.

One thing to keep in mind is that this section will contain soft and hard inquiries. A soft inquiry usually occurs when you are being reviewed for a background check, a “pre-approval” offer, or when you check your own report. Soft inquiries do not affect your score.

A hard inquiry is when your report is reviewed in determination of new credit. This does affect your score.

Related: How to Take Monitoring Your Credit to the Next Level

There you have it! That was simplest breakdown the CGS Team could provide on how to read your credit report. If you are still having trouble reading your report or have other insight, share your questions or feedback by leaving a comment below. The CGS Team is always available to help when needed.

-The CGS Team

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3 thoughts on “How to Read Your Credit Report”

  1. have you ever tried reading your credit report and become frustrated and overwhelmed? Well I have. I wish I would have had this article handy before reading my credit score. It would have saved me a lot of time and frustration

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