About Credit Reports

About Credit ReportsCredit reports are multi-page documents produced from the data bases of the three major credit bureaus. What is contained in these reports vary both by credit bureau and the information they have on you. Since not all creditors report to all three credit bureaus, the information often varies between them. Some of the common information included in your credit reports would be previous addresses, other names you have gone by such as a maiden or previously married name, and other information provided by your creditors.

Credit bureaus receive information from your creditors. The credit bureaus compile this information in large data bases. This information can include alias that you have gone by. Because your credit report is linked to your social security number, any changes in name are attributed to you. Credit reports may also contain names that are not yours but may have been a typographical error on the part of a creditor. While errors in your name on your credit report don’t affect your credit score, they may affect the application you put in for a job. Many jobs who pull your credit report as part of the application process have already asked you for other name you have gone by. This gives a potential employer an impression of whether you are starting out your employment as truthful.

Your credit report may also contain your previous addresses and telephone numbers. While this information is seen as neutral in a credit score algorithm, it is still important to your credit report. These are used for identification purposes. Like with your name, any phone numbers listed were provided by your creditors. If a creditor has input your phone number incorrectly and then reported it to one of the credit bureaus, it may make it difficult to get your annual report at a later time. Likewise, an erroneous address could be a simple as a mistake in the records of your creditors. Other times when an address listed is not one that you have been associated with it can mean a possible attempt at identity theft. If you have stray addresses on your credit report, it is important that you verify that you recognize all credit items on the reports.

Sometimes your credit report will contain information about your employment history. Generally, this information is limited to who you worked for and when you were working there. Again, this is for identification purposes. While your employment history is on your credit report, it is rarely complete or accurate. Like with the other information provided to credit bureaus, your work history is limited to what information your creditors have on you. Each time you apply for credit that requires you to identify your employer, that creditor updates the information about you with the credit bureaus.

Credit Reports will also contain your payment history as reported by your creditors. Other information that creditors report balances owed and available credit. When a credit item is reported, it often reports the date that the credit line was opened. Each month that the credit line is open, creditors will often update the balances, available credit, and payment history. This information is a portion of that is used to determine your credit score.

In addition to creditors that you have agreed to accept credit from, you may have negative accounts known as collection accounts. Collection accounts are accounts that you may have owed to a medical facility, utility, or other creditor that has been subsequently been bought by an agency. Collection agencies also report information to credit bureaus which ends up on your credit report. Judgments and tax liens can also end up on your credit report. While this information is often seen as negative, if it has been on your credit report for long enough, it begins to affect the portion of the score that has to do with length of credit.

When a creditor pulls a credit report, with the intent of offering credit they look at the information compiled by the credit bureaus. For credit cards and some loans, they may only pull one credit report. The information on that report will determine what kind of terms you are offered. Mortgage lenders want to look at more information and will often pull either two or three credit reports. These comprehensive reports are known in the industry as a bi-merge or tri-merge.

A bi-merge or tri-merge report compares the information reported on each of two or three credit reports, respectively. In addition to a merged report reporting the information in an individual credit report, it identifies which reports the information is from. So, if you have information that is only reporting on one of the three bureaus, this would be apparent on a tri-merge as the information would only be credited to the one bureau. When determining the terms that you will be offered for a mortgage loan, the credit lenders will order a tri-merge with scores. They eliminate the highest and lowest scores and base the terms on what your median credit score is.

A credit report is a compilation of data accumulated by credit bureaus and produced upon request to a potential credit lender. The data that is in the credit report is provided by creditors and collection agencies to credit bureaus. Some creditors request special reports known as bi-merge or tri-merge reports. A bi-merge includes the information found on the reports from two credit bureaus. A tri-merge includes the information found on reports from all three credit bureaus. Sometimes the data is not correct such as when a creditor has mistakenly recorded a different phone number or address for you. Credit information can also be reported incorrectly. The inaccurate information can be corrected by credit repair.

Free Credit Report

Free annual credit report may be obtained from each of the credit bureaus upon request. In 2003, an amendment to the Fair Credit Reporting Act (FCRA), known as the Fair and Accurate Credit Transactions Act or FACT Act, was enacted to allow consumers to monitor their own credit. Prior to the FACT Act, consumers were limited to getting a copy of their credit report when they were denied credit, were on public assistance, or were a victim of identity theft.

When a creditor decides not to extend credit to a consumer, based on the information in that consumer’s credit report, they send you a letter with a number that confirms their decision. This letter can be used to obtain a free copy of the credit report used in the decision to deny credit. This only permits consumer one free copy of one of the credit reports. The purpose of this report is to allow the consumer to verify the accuracy of the information.

When a consumer files a complaint of identity theft, they are able to get an additional free credit report. Each of the credit bureaus have a different procedure for consumer complaints of fraud or identity theft. Under the Fair Credit Reporting Act (FCRA) you are entitled to free copies of what is in your credit report. (See article on Fair Credit Reporting Act for more information.)

Under the FACT Act, consumers may request a copy of what is in their credit report from each of the three credit bureaus. A website was created to give consumers access to the one free copy of their credit reports that is guaranteed under this act. Annualcreditreport.com allows consumers to request their free annual credit report from a centralized location.

When a consumer goes to Annualcreditreport.com, they are given the option of requesting a credit report from one, two, or all three bureaus. Each of the credit bureaus will also offer a credit score for an additional cost. The credit score that is offered is not the same as the ones used by creditors to determine a consumer’s creditworthiness.

In addition to the credit report used to extend credit, consumers may also request, under certain circumstances, the report used to extend offers of employment. These reports are produced by specialized agencies. Employers with a potential employee’s permission, pull a consumer report. Copies of this report may also be requested by the potential employee to verify validity of the information on the report.

A free credit report from each credit bureau is available to each consumer every 12 months. This is part of the Fair and Accurate Credit Transactions Act or FACT Act. Under the Fair Credit Repair Act or FCRA, there are additional ways to obtain a free credit report. Free credit reports can also be obtained if there is suspicion of fraud or identity theft. A consumer file may also be requested from the agencies that provide such reports to potential employers.