In this video, we pull back the curtains so you can see the inner workings of your credit reports. To effectively improve your credit score, you must first understand the content of your credit file.
Inner Workings of Credit Reports – 4 Content Sections
1. Personal Identification Information
Use this section to verify that the report’s content contains your personal information and no one else. Included should be your name, social security number, address history, employment history, and your date of birth. This information may consist of clues that you are a victim of identity theft. Personal ID data does not affect your credit score.
2. Tradelines/Account Listing
This section is most familiar to consumers. Here you will find the names of your creditors, the account type, the account number, credit limits, and current balances. For each account, your payment history and past due status are also shown. Carefully evaluate this information to verify its accuracy. Your payment history drives 35% of your credit score. Your debt utilization affects an additional 35%.
3. Inquiries
There are two types of inquiries, hard and soft. Hard inquiries affect your credit score, whereas soft inquiries do not. Hard inquiries are created anytime you apply for a new loan or a new credit account. Soft inquiries occur when creditors peek into your credit file for marketing purposes. Inquiries impact 10% of your credit score.
4. Public Records and Collections
The inner workings of credit reports as they relate to public records include bankruptcies, liens, and other state and local court information. If you have past-due debts in collections, they may appear in this section of your credit report.
Inner Workings of Credit Reports – 3 Ways to Get a Copy
U.S. Federal Law entitles you to get a free credit report every 12 months from each of the three major credit bureaus. You can obtain your free reports by using either of the following options:
When requesting my mail, first download, and complete the Annual Credit Report Request Form. Click here to access and download the form now.
Before requesting a report via website or telephone, first, gather a copy of all your current bills. These documents will help you answer a few security questions before your request is approved. If answered incorrectly, you will be forced to obtain your reports by mail.
