Debt Basics

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Your Credit Report -- Getting It and Fixing It

Before you even start trying to understand you need to get a credit report.

Credit reports have four major sections: identifying information, credit history, public records, and inquiries. Identifying information is simply personal information about you—your name, birth information, phone numbers, social security number, driver’s license number, and profession. Do not be alarmed if there are name misspellings or variations, which happen quite frequently.

A section on credit history should follow the identifying information with a list of accounts. The information here should include the type of credit or account, dates of when it was opened, closed, or resolved, the total amount, monthly payments, how well you have paid on the account and its current status. There might be specific comments on how you’ve typically paid—always on time, typically 5-10 days late, etc. If a creditor has written “charged off”, this unfortunately means they have given up trying to gain payment from you. There might also be payment codes regarding your regular paying history. The next section on your report will hopefully be blank of information as it is the section where financial difficulties, such as a bankruptcy or tax lien are listed.

Last there is a section for inquiries or a list of anyone who has tried to obtain a copy of your credit reports. There are soft inquiries and hard inquiries. Soft inquiries are great in number and usually stem from companies that want to send information to those who qualify for a credit card or promotional offer. Hard inquiries are noted when you have filled out an actual credit application for a new credit card or large purchase that you plan on making payments on.

When examining all three reports, highlight any questionable accounts. If you do find a mistake, you need to report it immediately. There should be an additional form with instructions on how to dispute any information listed. To protect yourself and your credit history, check your report once a year. All three major credit bureaus, Experian, TransUnion, and Equifax, have user-friendly websites with loads of information on how to protect your credit and solutions to any financial problems you foresee. Take advantage of this and be confident in knowing your credit is clean.

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* Debt Basics is not a lender or broker. We provide information and research on debt help and debt consolidation. Product and service offerings differ by state.