Credit Report

So you’ve decided to get your credit report. Now that you’ve got it, there are an awful lot of numbers, abbreviations and terms you’ve never seen before. Trade lines, charge-offs, account review inquiries — how do you read this thing? First off, there are three major credit-reporting agencies in the United States: Experian, TransUnion and Equifax. You need to look at all three, as each will have different information and creditors subscribe to whichever agency they want. A credit report is divided into four sections.

Identifying information: Scrutinize the credit report for accuracy. It’s not unusual for it to list two or three spellings of your name or more than one Social Security number, usually because someone misreported the information. Those variations aren’t considered significant. Other info includes current and previous addresses, date of birth, telephone numbers, driver’s license numbers, employers and spouse’s name.

Credit history: Each account on the credit report will include the name of the creditor and the account number(s), listing such vital statistics as when you opened the account; type of credit (installment, such as a mortgage or car loan, or revolving, such as a department store credit card); single or joint account; total amount of the loan, high credit limit or highest balance on the card; amount owed; monthly payment; and status of the account (open, inactive, closed, paid, etc.). The Experian credit report history is in plain English — never pays late, typically pays 30 days late, etc. Other credit reports use payment codes ranging from 1 to 9; an R1 or I1 indicates good payment history.

Public records: Hopefully the next section of your credit report is absolutely blank. It doesn’t list arrests and criminal activities; just financial-related data, such as bankruptcies, judgments and tax liens. Those monsters trash your credit fast.

Inquiries: “Hard” inquiries on a credit report are ones you initiate by filling out a credit application or taking your child to the orthodontist. “Soft” inquiries are from companies that want to send out promotional information to a pre-qualified group or current creditors who are monitoring your account. Only a large number of inquiries can negatively impact on your credit report score.