What is a Credit Report And How Will It Effect You?
A credit report is important to everybody at some stage in their life which is why having a full understanding of how a credit report works is essential.
Many people underestimate the importance of their credit report. In fact your credit report can affect you when you are getting a mortgage, buying a car, applying for a loan of any kind, or even setting up utility bills. So why not read on to discover what a credit report is and how to find out what is contained within your credit report?
Credit Report – The Basics
So, what exactly is a credit report? A credit report is a detailed account of a person’s credit history. It enables lenders to determine how risky it is to lend credit applicants money and aides lenders in setting interest rates. The data provided within a credit report can be broken down into four broad areas.
1) Personal Data – This may include details such as the person’s name, current and previous address, date of birth, National Insurance Number and is normally situated at the top of the credit report.
2) Credit Data – The person’s credit data, such as their credit account numbers, any credit payments and their details in terms of punctuality of payment, the name of any creditor the person is associated with, can also be found within the credit report.
3) Public Record Data – This part of the credit report may contain information found within the public record including Court County Judgements, tax liens and information regarding bankruptcy.
4) Creditor Listing – This final part of the credit report contains a listing of all the creditors who have had access to a copy of the credit report and have reviewed the credit report.
Credit Report – The Uses
Your credit report may be accessed by a variety of differing people and organisations, for a variety of reasons, many of which may not have occurred to the average consumer. Every time you apply for a mortgage, loan or even want to set up a mobile phone account, creditors may review your credit report. As the credit report can be viewed by such a variety of people it is important that the information contained within the credit report is as accurate as possible, to give you the most favourable credit rating.
Credit Report – Advice
The best way to keep tabs on your credit rating is by accessing your credit report yourself and checking the data which is contained within it. You can often request a free copy of your credit report through credit monitoring companies and credit reporting agencies. Once you receive a copy of your credit report be sure to go through it with a fine toothcomb. Remember that every inaccurate piece of information contained within the report may work against you. Report any mistake found as swiftly as possible. This will speed up the corrections within the report. Ensure that every creditor in the fourth section of the report has the authority to check your credit report. By keeping an eye on your credit report you are ensuring that the creditor’s view of your credit history is a fair one.