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Credit Reports, Explained: What’s a Credit Report and How Do You Read One?

TLDR

What You Need To Know

  • A credit report is essentially a report card that is tied to your Social Security number and shows how well you have managed credit or debt in the past
  • Credit reports generally include credit account information, personal information and public records while excluding your credit scores, income and debit cards
  • There is no uniform formatting for credit reports. But they’ll each contain the same general types of information about you and your credit history

Contents

Credit reports are records of your financial history.

The information in your credit reports is used to calculate your credit scores. Positive information and demonstrating responsible financial behavior can improve your credit scores. Negative information, like late payments and collection accounts, can damage your credit scores.

But what exactly is included in a credit report and how do you read it? How much can lenders learn about you when they pull your credit reports?

It’s important to keep an eye on the health of your credit, and that means having some idea of the contents of your credit reports. Keep reading to learn what to look for.

Credit Report Definition

A credit report is essentially a report card that is tied to your Social Security number and shows how well you have managed credit or debt in the past. There are three major credit bureaus (also known as credit reporting agencies) that produce and sell credit reports: Equifax®, Experian™ and TransUnion®.

Lenders, creditors, companies and even landlords can purchase credit reports from the credit reporting agencies (CRAs) when you apply for new financing or services. The reports help them determine whether or not to take you on as a customer or tenant.

Existing creditors (like your credit card issuers) may review your credit history from time to time, to confirm that continuing to do business with you is still a smart investment.

Example credit reports

Before jumping into your credit reports, you may find it useful to browse through some simple examples. Follow the links below to get an idea of how your credit reports might look.

Where Credit Report Data Comes From

The details on your credit reports primarily come from companies that are known in the credit world as data furnishers. Data furnishers are the lenders, creditors and collection agencies that provide information about their customers’ accounts to the CRAs.

Different types of accounts will remain on your credit reports for different lengths of time, having either positive or negative effects. We’ll go over the impact of negative credit information later on.

Credit reporting is completely voluntary. No law says companies have to report account information to the credit bureaus. Likewise, no law requires a CRA to accept information and include it in your credit reports.

However, if the information is shared and included on your credit reports, the Fair Credit Reporting Act (FCRA)[1] requires the information to be accurate.

Errors on your credit reports can lead to lower scores and worse outcomes when applying for credit. So it’s important to monitor your reports to identify any harmful items. Take steps to remove them as soon as possible by contacting the CRA that created the report.

Information That’s Included in a Credit Report

Credit reports generally include credit account information, personal information and public records while excluding your credit scores, income and debit cards.

Equifax®, Experian™ and TransUnion® each produce a separate credit report, giving you three different credit reports in all. There is no uniform formatting for credit reports. But they’ll each contain the same general types of information about you and your credit history.

The following types of information will be included in your credit reports:

  • Personally identifiable information
  • Credit accounts (aka tradelines) and collections
  • Public records
  • Credit inquiries
  • Consumer statements, fraud alerts and disputes

In addition to what’s on the list, you’ll also find a description of your rights as a consumer and contact information for the credit bureau.

Credit reports aren’t always easy to read. But if you take some time to study each section, you should be able to get a good understanding of your credit profile.

Now let’s go over the main sections of credit reports, how to read them and what to look for in each one. You can follow along with any of the example credit reports from above if you’d like. The TransUnion® or Equifax® reports might be the clearest examples.

1. Personally identifiable information

This section of your credit report includes all the information that associates your identity with your credit. It may include:

  • Name
  • Date of birth
  • Social Security number
  • Current and previous addresses and phone numbers
  • Current and previous employers
  • Other identifying information

In this section of your credit report, you’ll want to make sure that all of your personal information is correct. If you find addresses you don’t recognize, it could mean someone has fraudulently used your information. This goes for all of your credit accounts in the report, too. So keep an eye out.

2. Credit accounts and collections

Your report also contains a list of your credit accounts, with details about each one. This section will include all accounts you currently have open with banks, credit card companies and any lenders, as well as accounts you’ve closed in recent years.

Your accounts may be organized according to status. Open accounts and closed accounts may be grouped separately. Additionally, accounts in positive standing may be grouped separately from accounts in negative standing.

Each credit account is also identified by type: credit card, home mortgage, student loan, auto loan, etc.

You’ll see the name of the lender or creditor, and the date you opened the account. You may also see details like:

  • An ID number for the account
  • The amount of the loan or the account’s credit limit
  • The highest account balance on credit cards
  • Your responsibility for the account (owner, co-signer, etc.)
  • Your payment history over the past 2 years or more
  • Additional notes and remarks

When it comes to the status of each account, that field shows whether the account is open or closed and its current payment status.

For example:

  • Open/never late: This means the account is currently open, and the payments have always been current.
  • Closed/current: This means the account is closed, and the payments were current.
  • Closed/never late: This means the account is closed, and you never made a late payment.
  • Closed/was X days delinquent: This means the account is closed and was delinquent by a certain number of days.
  • Charged-off: This means the debt on the account was delinquent, and the lender charged it off for tax purposes. However, you may still owe the debt.
  • Paid: This means you paid off the account, usually a loan.

Your credit reports will also indicate if any accounts have been turned over to collection agencies. Collection accounts are likely grouped together as well.

If you’ve been late or missed a payment, that information can show up on your reports, too.

Do an overall check to make sure account names, numbers, addresses and statuses (open, closed, good standing, etc.) look right to you. Know that when you’re looking at the balances of your accounts, they may not reflect your current balance because it depends on when the lender or creditor last reported your activity to the bureaus. If balances look too far off, it’s best to contact the credit bureaus and your creditor or lender.

3. Public records

The public records section, which contains negative information, is reserved for legal matters related to your debts. You may not see this section on your report if you don’t have any negative public information. But if you do find this section on your report, just check to make sure all of the information looks correct.

In the past, this section of your credit report included bankruptcy filings, tax liens and judgments. But an agreement between the credit bureaus and 31 state attorneys general, known as the National Consumer Assistance Plan (NCAP),[2] changed that. The agreement triggered policy changes that removed tax liens and judgments from credit reports, so you’ll likely only see bankruptcies.

However, since it’s a policy, not a law, tax liens and judgments could be included in reports in the future.

4. Credit inquiries

When a lender wants to check your credit they perform a credit inquiry. This section of the credit report lists all the credit inquiries made in the last 2 years with that credit bureau. So, if you’re looking at an Equifax® report, you’ll see all the lenders that checked your Equifax® report.

Credit inquiries can be made:

  • When you apply for credit cards, loans and mortgages or request higher credit limits
  • When lenders look to preapprove you for credit
  • When current creditors perform routine checkups on your credit
  • When you apply for a job, an apartment or a cellphone plan

Some credit checks are hard inquiries, which could cause a slight, temporary dip in your credit scores. Soft inquiries won’t have any effect on your scores. So you’ll want to make sure that any hard inquiries on your reports were requested by you and that they are no more than 2 years old.

The inquiries on your reports will probably be broken into two sections: one for hard inquiries and the other for soft inquiries. Each inquiry will include the date it was made and the name of the party that made it. They may also include how long each inquiry will remain on your report or the reason for the request, such as credit application or tenant screening.

Credit bureaus may refer to hard inquiries as regular inquiries, inquiries shared with others or inquiries that may impact your credit rating. And they may refer to soft inquiries as promotional inquiries, account review inquiries or inquiries shared only with you.

5. Consumer statements, fraud alerts and disputes

This section of your credit report (which could be broken up into multiple parts) includes any consumer statements, fraud alerts or credit report disputes you’ve made. You may not see any of these sections if you’ve never made a consumer statement, placed a fraud alert on your credit reports or filed a dispute. Just make sure all of the information looks correct if you do have any.

Consumer statements are brief explanations that either relate to your entire credit report or individual accounts. But consumer statements are of limited value because it’s rare that a lender will read any statements when considering your loan or credit application.

Fraud alerts are a free security measure to help protect your credit. There are three types of alerts:

  • Initial fraud alerts
  • Extended fraud alerts
  • Active-duty fraud alerts (for active-duty service members)

All fraud alerts require lenders to confirm your identity before opening any new credit accounts associated with your Social Security number.

Finally, if you’ve filed a dispute with a credit bureau, you may also see those details in this section. If you ever find any incorrect or fraudulent information on your credit reports, you should file a dispute with the relevant bureau(s) as soon as possible.

Information That’s Not Included in a Credit Report

Believe it or not, there’s a lot that’s NOT included in your credit report, including information about:

  • Checking and savings accounts
  • Debit cards and prepaid debit cards
  • Your income, assets and other wealth metrics
  • Your level of education
  • Your gender, national origin, race, religion or marital status
  • Your medical history
  • Your political affiliation
  • Criminal records
  • Your credit scores

There are many accounts you might not see on credit reports either, like cable television, cellphone plans, internet and utilities. However, if you default or are delinquent on any of these payment obligations, they may end up on your credit reports if the account is sent to collections and the collector reports it – which should be avoided if at all possible.

Why aren’t my credit scores on my credit reports?

Credit scores aren’t listed on credit reports. They’re calculated separately based on the information in credit reports.

When you’re ordering your free annual credit report, each of the three credit bureaus will give you the option to add a credit score to your report for a fee.

And thanks to Dodd-Frank Act[3] amendments to the FCRA, consumers are entitled to see certain credit scores for free if they’ve been denied credit or received less attractive loan terms as a result of their scores.

If you apply for a loan or credit card and the company uses one of your credit scores to either deny your application or offer less favorable terms (adverse approval), they must send you an adverse action letter. Legally, that letter must disclose the score that was used and the credit bureau it came from.

Nowadays, it’s much easier to check your scores for free, and as often as you like, by using a credit monitoring service, like Credit Karma.

Why isn’t my account on my credit reports?

If you’ve checked your credit reports and found that a credit card or other account is missing, it could either be an error or your credit card issuer or lender may not report to one or more of the credit bureaus.

Every lender and creditor has its reporting policies, but most include some sort of regularly scheduled automatic update that electronically transmits your account information to the credit agencies every 30 days.

With the major card issuers, if your credit card isn’t showing up on your reports, it’s more likely an error than a reporting policy. Smaller credit unions and financial institutions may not report to all three bureaus. If you’re not sure, call customer support and ask.

Remember, credit reporting is voluntary. Your lender or creditor may not agree to report your account. Other than finding a different company to do business with, there’s not much you can do in that situation.

Negative Information on Your Credit Reports

As the information in your credit reports changes, your credit scores will reflect those changes. In fact, the older negative information gets, the less impact it will have on your credit scores. This is because credit scores place more emphasis on your credit patterns over the last 12 – 24 months.

It may sound counterintuitive, but typically, the key to recovering from credit damage is to jump right back into the mix and begin adding new, positive information to your credit reports.

Change won’t happen overnight, but as you continue to manage your new accounts responsibly, those on-time payments should help improve your credit over time.

Most negative information will stay on your credit reports for 7 years, but there are some exceptions.

Credit accounts

Negative credit accounts may stay on your credit reports for up to 7 years and 6 months from the first missed payment that led to default.

Collections

A collection account can remain on your credit reports for up to 7 years from the date the account went into serious delinquent status, typically the date of the first 180-day late payment.

After collection accounts are purchased from the original creditor, the day the account went delinquent is what must be reported, not the date the account was purchased by collections.[4] The FCRA won’t allow collection agencies to “re-age” collection accounts to keep a negative account on credit reports longer.

If a collection agency tries to re-age your account, you should dispute the account with the relevant credit bureaus. If that doesn’t work, contact an FCRA attorney.

Charge-offs

Accounts with a charge-off status should be purged from your credit reports 7 years from the date they became 180 days past due.

Bankruptcies

Chapter 7 bankruptcies can remain on your reports for up to 10 years from the date filed. Chapter 13 bankruptcies can remain for up to 7 years from the date discharged, or a maximum of 10 years.

Credit inquiries

By law, most credit inquiries are required to remain on your credit reports for 2 years. With FICO® Scores, credit inquiries also stay on your credit reports for 2 years, but only inquiries made within the last 12 months are typically considered when calculating your scores.

Repossessions

Repossessions should be off your credit reports no later than 7 years from the date your auto loan went into default or 7 years and 6 months from the date of the first delinquency on your auto loan that lead to the default.

New York state residents

Satisfied judgments can remain on credit reports for up to 5 years from the date filed. Paid collection accounts can remain for up to 5 years from the date of the last activity.

California state residents

Paid and released tax liens can remain on your credit reports for up to 7 years from the date released. Unpaid tax liens can remain for up to 10 years from the date filed.

Time To Check Your Credit Report

Now that you know what goes into credit reports, it’s time to check out yours. Learn how to access your free credit reports from AnnualCreditReport.com and then monitor them over time to guard against errors and fraud.

  1. Federal Trade Commission. “Fair Credit Reporting Act.” Retrieved May 2022 from https://www.ftc.gov/legal-library/browse/statutes/fair-credit-reporting-act

  2. Consumer Financial Protection Bureau. “A new retrospective on the removal of public records.” Retrieved May 2022 from https://www.consumerfinance.gov/about-us/blog/new-retrospective-on-removing-public-records/

  3. Consumer Financial Protection Bureau. “Fair Credit Reporting Act.” Retrieved May 2022 from https://files.consumerfinance.gov/f/documents/102012_cfpb_fair-credit-reporting-act-fcra_procedures.pdf

  4. Federal Trade Commission. “Consumer Reports: What Information Furnishers Need to Know.” Retrieved May 2022 from https://www.ftc.gov/business-guidance/resources/consumer-reports-what-information-furnishers-need-know

ICYMI

In Case You Missed It

  1. Errors in your credit reports can lead to lower scores and worse outcomes when applying for credit. So it’s important to monitor your reports to identify any harmful items

  2. Typically, the key to recovering from credit damage is to jump right back into the mix and begin adding new, positive information to your credit reports

  3. Credit scores aren’t listed on credit reports. They’re calculated separately based on the information in credit reports

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