You are entitled to a free credit report from each of the three credit reporting bureaus each year, but once you’ve pulled the credit report from www.annualcreditreport.com, reading it can often be confusing. The report from each bureau is slightly different but each has four major sections:
• Identifying information: This is your personal information – name, social security number, addresses, both past and present, date of birth, spouse’s name, etc.
• Credit history: This will include the name of the creditor and account number. The account number may be scrambled or changed in some way for security reasons. This is the section that has the original balance of the loan and how much you still owe. If the entry is for a credit card it will have the credit limit and/or the highest balance on the card. Information included will be the status of the account (open, closed, inactive, paid, etc.) and whether or not you have paid and paid on time.
• Public records: This section includes bankruptcies, tax liens, judgments, etc. Ideally this section will be empty or even non-existent on your report.
• Inquiries: This is a list of everyone that has asked to see your credit report such as phone companies and rental agencies as well as companies, such as credit card companies, that might want to pre-qualify you before sending you information. Current creditors sometimes also request a report in order to monitor your accounts.
While it’s estimated that as many as 80% of all credit reports have some misinformation in them there are a few discrepancies to which you will want to pay particular attention. A credit company with whom you have never sought an account listed in the credit history section, a past address where you or one of your children have never lived or a credit balance that you know is not yours might be an indicator of identity theft and should be investigated carefully.
While it may take awhile to decipher your credit bureau reports the first few times around, once you become accustomed to the format, as long as there are no important inconsistencies, this little chore should only take a few minutes.