A Beginner's Guide to Understanding Your Credit Report
Your credit report is a financial biography that affects your ability to borrow, rent, and sometimes even get a job. Here's how to read and understand it.
Financial Writer
What's In Your Credit Report
Your credit report contains personal information (name, address, SSN), account information (all open and closed credit accounts from the past 7–10 years), public records (bankruptcies), and inquiries (applications for credit). It's compiled by three bureaus: Equifax, Experian, and TransUnion.
Reading Your Account History
Each account shows: current balance, credit limit, payment history (35-year month-by-month grid showing on-time vs. late payments), date opened, and account status. Late payments are marked 30, 60, 90, or 120+ days late.
Negative Items and How Long They Last
Late payments: 7 years. Collections: 7 years from original delinquency. Chapter 7 bankruptcy: 10 years. Chapter 13 bankruptcy: 7 years. Hard inquiries: 2 years (only affect score for 12 months).
Disputing Errors
Under the Fair Credit Reporting Act (FCRA), you have the right to dispute any inaccurate information. File disputes directly with each bureau online. They must investigate within 30 days. Identity theft accounts can be removed with a police report and identity theft affidavit.
Comments
No comments yet. Be the first to leave one!