So you have heard about your credit report but have you ever wondered what exactly it is and what it means to you? How do you find out about it and what can be done about it if things don’t look so great? These are all good questions when learning about your credit report. To put it basically, your credit report has all kinds of information on you regarding aspects of your credit. Obviously there is your contact information, address etc, but more importantly there is information to do with how you have paid off your bills (if you are late paying them, or overdue accounts), there is any legal information regarding collections, if you were sued, if you have a criminal record, any bankruptcies etc.
This information is all pertinent to you as it reflects what kind of interest rates you may receive with a loan, as well as you ability to obtain a credit card, mortgage, car loan etc. Have you ever applied for a loan yet been denied? Or received what you have thought to be a high interest rate? It is possible there could be something on your credit report indicating that you may have not been the best candidate for such a loan. The financial institutions must protect their own business and if you are perceived as a possible threat of not repaying, they will charge you accordingly to manage the risk associated with you.
There are several parties entitled to viewing your credit report, various financial institutions such as banks, any company providing a loan of any kind, there are also insurance agencies as well as possibly landlords and employers. So you see that if all of these entities can view it and react accordingly to your report, it can really affect the kind of rates and trustworthiness you have. It should also be pointed out however, that it is not strictly your credit report that may be of interest to possible lenders. These include your current employment, how stable it is, what you earn and if you have any assets to back your loan (not always necessary, but they want to know) So how does one go about viewing what is on it and thus either working to change it or challenge it?
Well fortunately, there is something called the Fair Credit Reporting Act also known as the (FCRA). This allows individuals to receive a copy of their report every year if they do indeed request it. It is a good idea to do this. You may think that you have excellent credit and have nothing on there that could affect anything but there are sometimes errors on it. So whether you like it or not, these errors could be costing you! Also, there is a growing concern for identity theft. Unfortunately this problem is growing as criminals are becoming smarter with how to steal someone’s identity through various ways. By viewing your credit report, you can act on any possible identity theft before it gets worse.