Learn How to Read Your Credit Report
Retrieving your credit report is fairly painless, but making sense of it afterward is a different story. Although your score provides you with a type of summary, you should still skim through the details, pinpointing weak areas for later improvement. To do so, however, you need to know what to look for.
Learning how to read a credit report boils down to understanding its format. Below, you will find a general overview of the main sections of a generic report. For those overwhelmed by this whole process, there are agencies that can help. Trillium Auto Group is one such company that can assist in obtaining and assessing your reports.
This section of the credit report profiles all of your personal details — name, address, employer, and so on. Check for variations of spelling and that all information is up to date. If, for instance, your address is outdated, this is less of a concern than blatant errors. Often, accountants check here first for fraudulent activity.
Your credit summary explores the different types of accounts currently registered to your name. Although some reports attach a legend, the letter “I” commonly stands for installment, “O” for open credit, and “R” for revolving debt. Other types of accounts listed in this area include real estate and collections.
Some reports breakdown each item in this section and assign a grade between 1 and 9, the higher indicating tardiness and delinquency. Details that appear in this section include balance and status, ownership, past payments, limits, and creditor remarks.
Multiple “soft inquires,” those concerned with pre-approved offers and account reviews, are less detrimental to one’s score than generally believed. Applications for large installment debt, however, can have a negative impact when refused or sent in bulk. These inquires remain on a report for approximately two years, so double check the accuracy of events in this section.
Collections, bankruptcies, and tax liens are among the many items featured in this section. Read each entry carefully and look for ways to appeal the offense. Sometimes, when in good-standing with an institution, such records may be forgiven or lessened after a few months of good behaviour. Based on the rest of your report, look for strengths that may help you with your plea.