What is a Credit Report?
Your credit report is a record of your credit activity and credit history. It includes the names of companies that have extended you credit and/or loans, as well as the credit limits and loan amounts. Your payment history is also part of this record. If you have delinquent accounts, bankruptcies, foreclosures or lawsuits, these can also be found in your credit report.
How does information get on my credit report and is it updated on a regular basis?
Every month, lenders submit updates on your credit profile to at least one of the three credit reporting companies—TransUnion, Equifax and Experian. Since lenders do not necessarily report to all three companies, the information on your credit reports may vary. It is also true that lenders report at different times of the month, a factor that might contribute to slight differences in your reports, and therefore your credit scores, at any given time.
Does my credit report contain information that is not related to credit?
Yes. Your credit report also serves as an archive for certain personal information, such as public records, your current and former address(es), names and employers.
Why is my credit report necessary? What purpose does it serve?
When you apply for credit (a mortgage or car loan, even a new credit card), lenders need a way to gauge whether or not you’re a safe bet. Your credit report includes a record of your financial reliability.
How long does negative information stay on my credit report?
Typically, the negative information on your credit report tends to fall off after seven years, or 10 if you’ve been through bankruptcy. Positive information remains on your report for an average of 10 years from the day its corresponding account is closed. This information applies to accounts like mortgages and car loans, which have fixed terms on the number of years for repayment. For revolving accounts, such as credit cards, your positive history will stay on your report for as long as the account is active.
Is there a place where I can explain some of the negative information on my credit report?
Absolutely. You have the right to attach a statement to your credit report that explains why, for example, you have a few late payments on your record. This statement will be provided to anyone requesting your report. Life is complicated, and this statement might convince an otherwise apprehensive lender to give you a chance.
Other than the credit bureaus and potential lenders, who else has access to my credit report?
The federal Fair Credit Reporting Act restricts who has access to the information on your credit report, and the law also dictates how your report can be used. Here is a list of companies that may have access to your report under appropriate circumstances:
● Mortgage lenders
● Utility companies
● Car insurance companies
● Government agencies
● Collection agencies
● Judgment creditors
Except in the case of court-ordered credit checks and credit pulls done for marketing purposes, no one can access your credit report without your authorization.