Everyone becomes concerned about their credit report and credit score at some time in their lives. It may be when a loan is needed to buy a home or a new car. Credit reports are an issue at other times, too, such as when you’re trying to obtain a new job or rent a new apartment.
You may have some idea what your credit report is, but many people don’t realize the depth of information these reports contain? If you’ve never looked at your own credit report before, you’ll probably be amazed at the wealth of information it contains. Your social security number, birth date, present and former addresses, amount of money you earn and even your place of employment are all part of your credit history. If you have been sued, had a lien or judgement placed against you, filed for bankruptcy or ever been arrested, this information will show up in your credit report. Credit reports also contain information about whether or not you’ve paid your bills and debts on time over the course of your lifetime.
Credit reports are generated by credit bureaus, and they receive the information they contain from businesses and other consumer reporting agencies. The major credit bureaus Experian, Equifax and Trans Union collect information on you from a variety of sources, then compile that data into your credit report. Then, credit bureaus sell your credit report to whoever is interested in seeing it (with your consent), including employers, creditors and other businesses and individuals. Everyone has access to their own credit report, including the sources of information it contains.
Identity theft is one reason more and more people are regularly checkign their credit reports. The “credit crunch” has also sparked new interest in consumers regarding their credit histories, as it has become more challenging to obtain loans, credit cards and other types of credit. Reviewing your credit report regularly instead of waiting until you need a good credit score is a smart strategy. Checking up on your credit yearly can help you prevent being denied insurance coverage, employment, the loan you need and even your next apartment rental.
Even those who are confident their credit is excellent are advised to check their credit scores at least once a year. This is because it’s a very simple matter for credit bureaus to obtain erroneous information. You have no way of knowing what’s in your report until you look at it.
You can take steps to clear off old or incorrect information, but it takes time. This is why monitoring your credit history is a better approach than waiting until you’re in need of the great credit score you believe you have. Although it can take some time and effort, monitoring and improving your credit history and credit score is well worth the effort, as it is the key to obtaining favorable interest rates on loans, credit approvals, securing employment and enjoying a host of other financial benefits.
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