Your credit report is certainly not the most suspenseful or action-packed document you will ever read. It’s not something that would keep you up all night, hurrying to read how it all turns out. In fact, it’s very dry reading and could bore you into paralysis. However, it’s also an incredibly important document.
Three, count ‘em three, credit bureaus.
You don’t just have one credit report, you really have a least three. The reason you have three is because there are three credit reporting bureaus or agencies. They are TransUnion, Equifax and Experian. Why are there three credit bureaus? I have no idea. I suppose that merchants, banks auto dealers and everyone else who needs credit reports have their reasons to choose one of these bureaus over the other two. But I have no idea what those reasons might be.
What’s in your credit report?
Somewhere in this big, wide country of ours there may be someone who doesn’t have a credit report. But this would be a big exception to the rule. The first time you apply for credit of any kind, the three bureaus will begin building a file on you. Your file will have your name, Social Security number, address, employment information and date of birth. It will also contain information on what are called your “trade lines,” which are your credit accounts. The organizations that have lent you money will report on your accounts including the type of account, the date you opened it, your loan amount or credit limit, the account balance and your payment history.
You gave them permission
Whether you are aware of this or not, every time you apply for any kind of a loan, including a credit card, you’re authorizing the lender to get a copy of your credit report. These inquiries are also on your credit report in a section that has a list of every organization that accessed your credit report within the past two years. This includes both “voluntary” inquiries where you requested credit, and “involuntary” inquiries, which is where companies ordered your report so they could make you a pre-approved credit offer.
Collection items and public records
Finally, you should be aware that the credit reporting bureaus also collect public record information from county and state courts, as well as information on debt that has been reported as overdue from collection agencies. The public record information they collect includes foreclosures, suits, bankruptcies, liens, wage attachments and judgments.
There can be errors
The three credit bureaus process a huge amount of information daily. Anytime a huge amount of information is processed, there can be errors. Is there an error in your credit report? Did someone report that you had a bankruptcy when it was really someone who had a very similar name? The only way you can know this is by getting your credit report and reading it carefully.
How To get your credit report free
By law, TransUnion, Experian and Equifax must provide you with your credit report once a year free. You could look up the addresses of the corporate headquarters of these three companies and write them a letter requesting your report. However, there is an easier way. You could go to the website www.annualcreditreport.com, fill in one form and get all three credit reports –free.
An inexpensive way to monitor your credit
Identity theft has become America’s favorite crime. One way you could protect yourself from it or at least minimize its effect is by requesting your credit report from the three agencies one at a time each quarter. Since at least in theory all three of your reports should be fairly identical this is a way to monitor your credit report throughout the year without spending a dime.