You can obtain your credit report a number of ways, however we recommend if you are starting out or starting over to get a free copy at AnnualCreditReport.com. You can receive a free copy of your credit report every 12 months from each credit reporting agency (Equifax, Experian, TransUnion). One thing to note – your free report will not include credit scores. You can obtain a free score from places like CreditKarma.com. Those scores are not a FICO score, but rather a general indicator of your credit health and standing.
Why should you order a credit report?
Three important reasons come to mind. First, you need to ensure you are not a victim of identity theft. ConsumerAffairs reports that cyber criminals are busier than ever in 2019, and consumers will need to become more knowledgeable about how data breaches occur to protect their personal information.
You also need to ensure your current and past credit accounts are reporting accurate information. If you are reviewing your credit for the very first time, you could potentially be overwhelmed with what you see. Your report includes personal information to include addresses and employers, a summary of the number of credit accounts you have owned, your payment history, and negative credit activity, and number of times you have attempted to open to new credit. We will touch on each area in detail below. One thing we should mention is that all three credit reports will likely NOT have the same information listed about you. Why? Some creditors only report to one credit agency. Some credit agencies may have you listed as living at a prior address based on information shared by a creditor, and one could have more inquiries than others due to a bank or lender only pulling that particular report. In the east coast, Equifax tends to be a popular credit report for many banks and lending institutions, while Experian is very popular for west coast based companies. Of course, your mileage may vary, but keep an eye on all discrepancies.
Expect to see basic demographic information here, such as your name, address, place of employment, and phone number. You can have variations of your name listed, such as John Doe, John S. Doe, or J.S. Doe. None of this information (correct or not) has any direct impact on your credit score. If you see any addresses or names listed that you don’t recognize, dispute the information with the credit agency. All three agencies make it painless to submit disputes online.
Overall Credit Summary
The credit summary section of your credit report will highlight information about the different types of accounts you have. You will find the total number of accounts, balances owed, number in good standing (current), number of delinquent accounts, and account type. There are four primary account types to familiarize yourself with:
Real Estate – Mortgages or Home Equity Lines of Credit
Installment – Student Loans, Auto Loans, Closed-End Personal Loans
Revolving – Credit Cards, Personal Lines of Credit
Other – Charge cards like American Express
If you have any accounts with negative activity, there could be a fifth section which highlights public records. Public Records will be accounts that have had legal action taken, such as a lien on property, garnishment of wages, or a bankruptcy filed. Public records can stay on your credit for up to 10 years.
Your account history will contain most of the information you will find useful. This section highlights your credit account’s specific activity, to include the name of the lender, their contact information, the type of account you have with them, the date you opened it, what your relationship is to the debt (sole borrower vs. joint account), the minimum monthly payment for the account, the date last reported, the balance as of the most recent statement, the loan original balance or revolving account’s highest balance reported, any remarks about your pay history. If you have been late over 30 days, it will show up here. Expect to see the past 24 months of payment history. If you see an account reporting incorrectly, you should reach out to the company first to verify the information is inaccurate, and then allow them to update. If there is trouble contacting them, consider submitting an online dispute. You should be prepared to present relevant information proving your claim.
The inquiries section of your credit report will likely have the greatest level of variability. You could review all three reports side-by-side, and notice your Equifax credit report has three inquiries in the past 24 months, while your TransUnion has zero, and your Experian has one. Excessive inquiries can have a damaging effect on your FICO score, contrary to what you read via social media. Remember, the only inquiries that ding your credit are those you submit to a company requesting credit, also known as hard inquiries. A soft inquiry is what you did earlier when you requested your report via AnnualCreditReport.com. When you pull your own credit report, it has no bearing on your standing.
As 2019 comes to a close, we recommend everyone review their credit reports ahead of the holiday season. If you have any plans of potentially making a major purchase in 2020 (house, auto), take a look at what your report looks like today, and compare it to your mental notes on accuracy. Pay down/off any outstanding debt, and hold off on applying for new credit until you are ready.
Submit a dispute online: