Getting is credit report is quite easy and free. The issue is understanding your credit report without consulting anyone. If you don’t, it’s not a crime. You may not be aware of the means of getting a credit report, this guide will help in acquiring one and knowing what to check. According to law, you are entitled to a free credit report each from either of the three credit report annually. To get your free credit report, just visit AnnualCreditReport.com for a free copy by providing your full name, address, social security number and date of birth.
To understand your credit report, you need to look at the three reports from the three credit bureaus. Looking at just one will be a fruitless endeavor, with the three at hand, you are making the task easier. Don’t assume you will have the same information on it all, creditors provides information to whichever bureau they want due to voluntary nature of the credit report system. You should not just ask for a credit report from that your friend working in a bank, you will definitely find it difficult to comprehend. A direct copy from the credit bureaus are customer friendly.
No need to talk further about the personal details; quite self-explanatory. Just a breakdown of who you are, what you do and where you live.
In your credit report, you will see four sections; personal details, credit history, public records, and enquiries. Your credit history is the most important section you should be concerned about for the sake of your credit. This is where you’ll find the items that will prevent you from getting any loan approved and give you a negative credit report. In case you’ve ever had a credit turned over to a collection agency by your credit company, this is where you’ll find it. This is the most negative thing that can ever happen to your credit.
Your credit history will reveal your credit; mortgages, car loan and department credit cards. The essence of reading through your credit report is to be able to calculate and ascertain your credit score. Be aware that your credit score is determined by five specific factors that you should know. Your payment history is the first and is weighed at 35% of the today score; the punctuality of your payment will lead to higher score. However, payment history is rendered into lower scores due to bankruptcies, late payment and delinquencies.
Another determinant of your credit score is your debt to credit ratio. This is reached by weighing your credit debt against your credit limit, this factor accounts for 30% of the credit score. You should also be aware that the duration of your credit and the management of your financial history is not left out of the formula. That is the main reason why you should never close your old accounts, it will amount to 15% of the credit score.
Opening of new credit lines and seeking for answers to opening new credit account is also used in calculating the credit score. This criteria forms a basic 10% of the credit score; spread your enquiries for new credit over a long period to arrive at a positive credit rating. Lastly, the number of credit facilities you utilize is a great credit score builder. Lenders want to be sure you are performing well in other line of credit other than theirs, this is also another 10% of the credit score.
When it comes to credit, just know you are being watched. The credit bureaus and your creditors are watching you closely. Don’t turn a blind eye towards your credit, request for your credit report from all the three bureaus annually and correct every inaccuracies.
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