Your credit report (sometimes called credit profile) is a vital cog in your financial life. It’s a summary of your credit habits, usage and more that lenders use to determine if you get loans. It’s also where your credit score is derived from. Yes, it’s that important. So to help you get to know your credit report, here’s a quick guide.
Lenders look at your credit report to determine if you’ll get credit and/or a loan and what the terms will be. If your credit report has a low score, it’s harder to get credit and loans. If your score is high, you’ll receive better offers and terms.
A credit report includes a summary of your financial history. Here’s everything that you’ll find:
Personal info. Your name, address, Social Security number, and date of birth.
Credit account information. All the different types of accounts you have or have had open, including credit cards, mortgages, student loans, auto loans, and more. This section includes payment history when the accounts were opened and/or closed, credit limits, credit usage, and total balances.
Inquiry information. This is where your inquiries are logged. There are soft and hard inquiries. The former doesn’t impact your credit score; the latter does. Soft inquiries can come from your creditors reviewing your accounts. Hard inquiries come from companies, like credit card lenders, reviewing your credit report to determine your creditworthiness.
Bankruptcies. If you’ve ever filed for bankruptcy, this will be listed here.
Collections. If you’ve missed payments on a bill and it was sent to a collection agency, you’ll find it on your credit report.
You can (and should) check your credit report at least once per year. You can check your score from each credit bureau once per year for free.