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Offical Guide to Credit Reports

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Last Verified: March 22, 2023

What Is a Credit Report?

A credit report is a comprehensive summary of your credit history. It provides a snapshot of the data that the credit bureau has on you, such as your identifying information, credit account types, payment history, and other info like credit limits and bankruptcies.

The three major credit bureaus that provide credit reports in the United States are:

The information that appear on your credit reports from the three major credit bureaus may vary slightly. This is because not all creditors and lenders report information to all three credit bureaus, and the bureaus operate independently of one another and do not share information unless required by federal law. So, it’s important to review your credit reports from all three bureaus to ensure they are accurate and up-to-date.  

Important Note: A credit report is not the same as a credit score. A credit score is a numerical representation of your creditworthiness, calculated using data from a credit report. In contrast, a credit report is a repository of information that shows how you have used credit in the past.

Why Is a Credit Report So Important?

Credit reports gives a clear picture of your creditworthiness. Think of it this way, would you lend money to someone with a history of missing payments or someone who always pays on time?

A good credit report not only helps you when you’re applying for loans or credit cards but also opens up a world of opportunities. It can make it easier to secure a job, buy a house, rent an apartment, and even get better insurance rates. 

Who Has a Credit Report?

Anyone (regardless of age) can have information reported to credit bureaus, and they will have a credit report.

Example: If a minor is an authorized user of an adult’s credit card, they may have a credit report generated.   

How To Build Good Credit?

 Building good credit is an important step in achieving your financial goals, and it takes time. While there are many ways to improve your credit, the three most effective principles are the following:

  1. Having credit accounts is an essential aspect of building a credit history. In order to have a credit report, you need to have credit accounts such as credit cards or loans. These accounts are reported to credit bureaus.
  2. Paying bills on time consistently, never missing a payment.
  3. Keeping credit card balances low and making an effort to pay them down.

Where Does the Information on My Credit Report Come From?

The information on a credit report is provided by furnishers, such as collectors, banks, and credit card companies, and public records also supply this data. These organizations report an individual’s credit activity to the credit bureaus. This information is used to create an individual’s credit report.

Credit bureaus have different processes for collecting, recording, storing, and presenting information. This can result in variations in the financial data presented on a credit report from one bureau to another. 

Important Note: Not all creditors and lenders report to all credit bureaus. Some may not report to any, while others may only report to one, two or all three. This is why it’s important to check your credit report from all three major credit bureaus to ensure that the information is accurate and complete.

How to Access a Consumer Credit Report?

Consumers are entitled to one free credit report per year from each of the three major credit bureaus: TransUnion, Equifax, and Experian. These reports can be obtained through the website AnnualCreditReport.com. The bureaus also allow you to pull reports for free directly at various intervals.

The direct method of obtaining a credit report from the credit bureau is the preferred method as it ensures that the information is accurate and authentic. Credit reports obtained from third-party websites or providers may contain inaccuracies or errors.

To obtain a credit report, consumers must be prepared to provide personal information such as their name, current and previous addresses, date of birth, and social security number. It is important to ensure that the information provided is accurate in order to receive a correct credit report.

Free Credit Reports

MethodHow to GetHow Often?ProsCons
Annual Credit ReportAnnualCreditReport.comWeeklyProvides reports from all three credit bureaus in one process1. The process can be time-consuming as you will need to run through each of the three major credit bureaus individually.
2. Website glitches or technical issues can sometimes occur, further delaying your report’s access.
Credit Bureau WebsiteCreate accounts directly with the bureaus:
Experian.com
Equifax.com
Transunion.com
Depends on bureau, some allow free reports every year, some every few days.1. Alternative to AnnualCreditReport.com.
2. Once you establish an account with each bureau, it’s easier to pull the reports.
Each website provides only its report, so you need to visit all sites separately.
Third-PartyCredit Karma
Nerd Wallet
WalletHub
Every few daysIt’s free1. It can provide inaccurate data.
2. Does not provide credit reports from all bureaus.

Paid credit reports are an option for consumers who want more frequent access to their credit reports or additional features such as credit monitoring. 

Purchasing one-off paid credit reports is not necessary, as consumers are entitled to one free credit report per year from each of the three major credit bureaus. However, if you want to closely monitor your credit history, a credit monitoring service may be worth the cost.  

Our Verdict:

Keeping track of your credit report can be time-consuming and challenging. The free credit monitoring services available do not offer comprehensive or accurate information. Experian Credit Works premium is the best option for monitoring your credit as it provides access to all three credit bureaus and monthly score reports, giving you a complete and accurate picture of your credit history.

Check out our Credit Monitoring Comparison to learn more

How Often Should You Check Your Credit Report?

The data in your credit file can change at any time. Checking your credit report regularly is important to ensure that the information is accurate and to protect yourself from potential fraud. 

The Consumer Financial Protection Bureau (CFPB) recommends checking your credit report at least once a year, but we recommend checking it monthly.

Credit monitoring services can be useful in this regard, as they provide alerts of any changes to your credit report, allowing you to keep track of your credit history without having to check it manually every month.

Third Parties Accessing Your Credit Report

A consumer credit report is accessible to you and third parties for certain reasons. For instance, when you apply for a bank loan, mortgage, or credit card with a company, they will access your credit report to help evaluate your creditworthiness and make a lending decision. 

Other third parties, such as landlords, insurers, and employers, may also access your credit report as part of their decision-making process. It’s important to be aware that credit report access is not granted indiscriminately and is subject to certain regulations and laws.

The permissible purposes for inquiring about a credit report initiated by the Fair Credit Reporting Act (FCRA) include the following:

  • For court orders/a federal grand jury subpoena.
  • For employment purposes with the written permission of the consumer.
  • For credit extension/review or collection of credit account with a consumer application.
  • For insurance with a consumer application.
  • For a business transaction by the consumer for a legitimate business need.
  • For reviewing a credit account to confirm a consumer’s proper credit history.
  • To check a consumer’s financial status/health to get a license or other governmental grants.
  • For state and local officials to solve issues like child support modifications, payments, and enforcement.

Inquiries

FCRA distinguishes between soft pulls and hard pulls.

A soft pull or soft inquiry is when a credit report is checked by you or for the purpose of pre-qualifying a consumer for loan or other offers. These types of inquiries do not affect a consumer’s credit score and are considered permissible purposes under the FCRA and do not require your permission.

A hard pull or hard inquiry is made when a consumer has applied for credit or when a creditor or lender is making a lending decision. These types of inquiries usually impact a consumer’s credit score.

Freezing Your Credit Reports

A Credit Freeze is a federally protected right that allows consumers to restrict access to their credit reports by lenders and other parties. This protection can help prevent fraud and identity theft by making it difficult for unauthorized individuals to open new credit accounts in your name. 

By freezing your credit reports, you can still access your credit report and if you need to apply for loans you can unfreeze your credit report. 

Pros and Cons of Freezing Credit Report

ProsCons
Security: The primary purpose of a frozen account is to prevent fraud and identity thieves. A password or PIN is required to unlock a frozen account, so your account will be saved.

No hard inquiries: No one will be able to initiate a hard inquiry your credit report while your credit is frozen. Sometimes consumers will freeze one bureau in the hopes a bank will pull an alternative bureau.
Applying for credit requires a thawed report: You will need to unfreeze your report before you can apply for cards/loans. If you are in the market for a credit card or house, this can slow you down. Always make sure to unfreeze your report in advance.

How to Freeze a Credit Report

Freezing a credit report is completed directly at the bureaus. You need to contact all three credit bureaus separately:

  1. Equifax: Call 800-349-9960 or visit their website
  2. Experian: Call 888‑397‑3742 or visit their website.  
  3. TransUnion: Call 888-909-8872 or visit their website.  

Information you need for a Credit Freeze:

  • Social Security Number.
  • Date of birth.
  • Address.

If you can authenticate yourself online, that’s preferable. You may receive a PIN that’s required to unfreeze your credit in the future. Make sure not to lose this PIN.

Difference Between a Credit Lock and a Credit Freeze

Credit locks are a new invention by the credit bureaus that perform the same fundamentally as credit freezes. Credit locks however are not protected by federal law and they usually are bundled as part of a paid plan. The bureaus typically will make the credit locks a little bit easier to deal with, via a mobile or desktop app. We suggest credit freezes as they are free and federally protected.

Information Included in a Credit Report

A credit report holds some crucial information necessary for your credit history. Following is the data included in a credit report:

  • Personal Information (include your name, address, SS number, and date of birth).
  • Account Types.
  • Payment History.
  • Public Records.
  • Credit Limits.
  • Credit Inquiries (soft inquiries do not appear on credit reports that are provided to others, such as when a lender or creditor checks your credit history).

Information Not Included in a Credit Report

Each credit bureau has a different way of reporting your credit report. Generally, a credit report does not include the following:

  • Marital status.
  • Medical information.
  • Buying habits.
  • Race.
  • Transactional data.
  • Income.
  • Gender.
  • Bank account balances.
  • Criminal records.
  • Level of education.

How Long Does Information Stay on the Credit Report?

The length of time that information stays on a credit report varies depending on the type of information. Generally speaking, negative information, such as missed or late payments, bankruptcies, and collection accounts, will stay on a credit report for longer than positive information.

The FCRA dictates how long certain types of information are allowed to remain on a credit report. They do not regulate the minimum amount of time items must remain. For example, most negative information can stay on a credit report for 7 years, while bankruptcies can stay on for up to 10 years. If an item is on your credit report and it’s accurate and verifiable, the credit bureaus are not required to remove the information from your credit report before the time period has expired.  

Maximum Amount of Time Information Can Stay on Consumer Credit Report

Type of InformationMaximum Amount of Time
Personal InformationNo maximum
Opened & Positive AccountsNo maximum
Opened, Current & Past Negative AccountsNegative information stays for maximum seven years (from the delinquency date). The positive data can stay on forever.
Closed Accounts with No Negative InformationNo maximum
Closed Accounts with Negative InformationNegative information stays for maximum seven (from the date of the first delinquency).
Public RecordsMaximum of 7 years. Chapter 13 bankruptcy has a maximum of 7 years. Chapter 7 bankruptcy has a maximum of 10 years.
Soft InquiriesNo maximum
Hard InquiriesMaximum of 2 years.

Mistakes on Credit Reports

Similar to other records and documents, credit reports can also contain mistakes or errors. It is important to regularly check your credit report to identify any inaccuracies or errors that may be present.

Some common mistakes that may occur on credit reports include the following:

  • Late payments being reported as missed or delinquent when they were paid on time.
  • Accounts that are not yours appear on your report.
  • Incorrect personal information such as incorrect name, address, social security number, or date of birth.
  • Identity errors, such as a mixed file due to a similar name or social security number.

If you find any errors or inaccuracies in your report, it is important to contact the bureau that provided the report. Provide detailed information about the mistake or error and follow the company’s dispute process in order to have the issue resolved. 

Additionally, it is important to note that mistakes can occur on one bureau’s report or all three bureau’s reports. 

Repairing Your Credit

There are many companies and online resources that claim to be able to quickly and easily fix credit problems. However, it is important to understand that there is no magic solution to repairing credit. It is a continuous process that requires attention and dedication, but the benefits are well worth the effort.

There are three basic principles to fixing your credit:

  1. Bring all your accounts (current, opened, and currently closed).
  2. Create a positive history, or continue it if you lose track.
  3. Check your reports regularly and find errors in them. If you find mistakes or errors, contact the credit bureaus. They must remove them by law.

Wrap Up

So there you have it, a comprehensive guide to credit reports. You’re now equipped with all the knowledge you need to take control of your credit and improve your credit score. Think of it like a game, the higher your credit score, the more rewards you get, like better interest rates, bigger credit limits, and even cooler perks like lower car insurance rates. 

The bottom line is the more you know about your credit report, the better equipped you are to make informed financial decisions. So don’t forget to check your credit report regularly, and if you spot any errors, nip them in the bud right away. Now go out there and conquer the credit world!

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