Understanding Credit Reports
Credit reports are a part of financial life. They aren’t evil or bad, but they can be complicated and overwhelming at first glance. ACCC’s video helps clarify credit reports and answers some frequently asked questions.
Credit Report FAQ Video
Credit Report Sections
As you saw in the video, there are six main sections in a credit report.
- Personal Information
- Credit Summary
- Negative Information
- Creditor Contact Information
Depending on your credit history, these sections will vary in length. Use ACCC’s sample credit report to guide you through the six sections. The sample credit report also contains definitions of some challenging terminology found in the report.
How to View Your Credit Report
Understanding credit reports start with taking a look at your actual credit report. A consumer can request his/her credit report anytime. The Fair and Accurate Credit Transaction Act entitles consumers to one free credit report each year from each of the three main credit bureaus.
To view your report, visit AnnualCreditReport.com. This is the only website to get your free credit report. You may also call 1-877-322-8228 or send a written request to:
Annual Credit Report Request Service
PO Box 105281
Atlanta, GA 30348-5281
Mistakes in Credit Reports
Once you have your credit report, it’s important to check for errors. Mistakes in credit reports happen more than you think. A mistake could affect a future credit decision if left unnoticed. Staying vigilant about your credit report helps keep you safe from identity theft.
In 1971, the Fair Credit Reporting Act was enacted to protect the consumer. It states that consumers have the right to know what information is in their credit report. It also gives you the right to challenge errors. To correct an error on a credit report, follow these steps:
• Contact the particular credit agency that has incorrect information.
• The agency has 30 days to investigate the information.
• Information must be removed from a file if the CRA cannot verify it, or correct the errors.
• If the consumer disagrees with the result of the investigation, they can submit a 100-word explanation of their version of the dispute.
Unfortunately, viewing your credit score isn’t as simple as getting your credit report. Your score is separate from credit reports. It may take more effort to get your credit score, but it can be a useful tool for a few reasons. You can see how negative incidents have affected your credit. You can also be aware of how your credit will be viewed by others. Credit scores are an important factor for financial decision as well as employment.
One way to see your credit score is through Equifax, Experian or TransUnion. Some credit card companies or other financial institutions also offer your credit score as a free service to account holders. You can also pay to see your score at MyFICO.com.
Hopefully, the Understanding Credit Reports video has helped answer some of your questions. For more information about credit, visit ACCC’s Credit resources.