Credit Reports

If you are not familiar with credit reports then you should be. Every single person who buys a car, house or applies for any other type of loan will have a credit report pulled on them. You need to know what yours says and how to read it. If you don’t, you could be in some serious trouble.

There are 3 different reporting agencies and most of the time each one will be different. Some finance companies report to all three agencies while some only report to one or two of the three. It’s important that you know what is on each one of your reports.

You are entitled to one free credit report every year from each of the three agencies; Equifax, Experian, and TransUnion. Once you receive a copy of your credit report from each agency you can go through it and make sure there is no false information on there. If there is you can follow the procedures of each agency to get the mistakes fixed and off of your credit.

If you see anything on your credit report that alludes to charges or purchases that you did not make be sure to immediately contact the credit agency. Someone may have stolen your identity. Check for liens from people that you might owe money to. If you have any, you can request either in writing or online a copy of the charges and if you owe them, go ahead and pay them as soon as you can. It will still remain on your credit report but will show as paid. This lets lenders know that you might have had some trouble in the past but that you are working to get it fixed.

If you file bankruptcy you should know before filing that it is something that will remain on your credit report for at least seven years. That is a long time in the financial scheme of things even if it doesn’t feel like it. Every time a lender sees that on your credit report it could mean that you cannot get the house or car you might want and if you do, you will be paying a lot more on an interest rate. Try to avoid filing for bankruptcy if possible as it can hurt your credit more than you know.

On your credit report will also be listed any type of loan that you have. Revolving credit will be your credit cards. If you have paid those cards on time you shouldn’t have to worry about your credit being affected. However, if you have not paid your payments every month on time it will show on there too and that doesn’t look good to someone who wants to lend you money.

When you get a copy of your credit reports go through each of them with a fine tooth comb and make sure that all of the information is correct. If you don’t check it and something isn’t right on it you probably won’t know about it until it’s too late.