How to Read a Credit Report

Your credit score is one of the most important parts of your overall personal financial health. Due to this, understanding your current credit position is very important. To do this, you should have a credit report pulled from time to time, which will list out all of your creditors, past payment history, and possibly your score. For those that are reading a credit report for the first time, it can look quite confusing. There are various tips on how to read a credit report that will help ensure you are reading it properly.

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Check Your Personal Information

When you are going to check your credit report, the first thing that you should do is check and verify all of your personal information. The report should include your full name, address, prior residences, aliases, and other information. It could also list your current and prior employers. You should confirm that this is all accurate. If you see odd names, phone numbers, addresses, or other information, you should inform the credit bureau.

Check List of Accounts

It is also important that you check and review all the accounts on your credit report. The credit report will likely outline any open loans, credit cards, or other forms of debt that you have. It should also list accounts that were closed within the past few years. You should check to confirm that the accounts are real, that the payment history is accurate, and that the open balance and credit limits are accurate. The report may also list any recent credit inquiries that were made on your behalf. If you notice that there are open accounts on your report, it can be a sign that your identity was stolen. If there is any inaccurate or fraudulent information on your report, you should call the creditor immediately to have it fixed or accounts closed.

Review What is Affecting Score

Those that are going to read a credit report may also receive a summary of what is impacting their score. Your overall credit score is affected by many factors. The most significant is whether you have past due payments in the past if you carry a large amount of unsecured debt, and how long of a credit history that you have. The report can then identify areas that are impacting your score, both positively and negatively. If you are able to continue to do the right things and fix issues with your credit, it can give you a score boost in the future.

Your credit report is very important and understanding what is listed on it should be considered a necessity. If you are new to reviewing these reports, they can quickly seem challenging to decipher. There are various tips on how to read a credit report that can make this easier for you. If you do notice discrepancies or inaccurate information, it is important to contact the creditors as soon as you can as it could be an indication of fraud.

Read more: How to Get a Spending Limit Increase on Your Existing Credit Card