A credit report is a record of your financial history. A good credit report shows that you have responsibly managed your finances and used credit wisely. It also reflects that you are generally financially reliable, financially trustworthy, and responsiblewith money.
On the other hand, if you have a poor rating then it might be hard for you to get approved for new loans or credit cards in the future. People who apply for loans often use their credit report as a way of finding out about someone’s past behavior and how likely they are to pay bills on time or not at all!
How to read your credit report
Your credit report is a history of your debt, including loans and credit cards. Each of your creditors is assigned a different number for services rendered, which allows them to keep track of how well you’re managing your finances. The information in your report is then used by lenders when deciding whether or not to offer you financial assistance with something like a loan or home equity line.
There are three main categories that make up any individual’s credit score:
●Payment history (do you pay on time?)
●Amount owed (do you have tons of debt?)
●Length of credit history (how long have you had accounts?)
Add up these categories and voila! You get your overall score—a number between 300-850 or so—that will be used to determine if the lender will extend its services based on this evaluation.
What information is on your credit report?
Your credit report contains your name, address, and social security number. It also has information about your accounts such as the account number, type of account (credit card, auto loan), and status of the account (open or closed). Your payment history and current balance are included on your credit report as well.
Other important information about you includes inquiries for new credit that have been made in the past two years along with any public records such as bankruptcies or lawsuits filed against you within seven years of when the report was created. The source of this information is also included on the report whether it’s from a public record like a bankruptcy or lawsuit filing from seven years ago or more recent inquiries for new credit requests over two years ago.
The final piece to complete your puzzle is how all these pieces fit together into one overall picture –your unique FICO® Score! Here in stratus we qualify FICO score not lower than 620.
How are your scores calculated?
Your credit score is a three-digit number that’s a measure of your creditworthiness. It’s calculated using specific information in your credit report, which can vary depending on the type of score you receive.
Credit scores are used to predict whether you’re likely to pay back loans and other debts on time, so it’s important to keep track of yours and makesure it’s as high as possible—especially if you’re applying for any type of loan or mortgage. The difference between good and bad scores can be thousands of dollars when applying for financing.
You may have heard terms like “good,” “average” or “bad” whenreferring to credit scores, but what do these mean exactly? Your score is measured on a scale that ranges from 300-850, with higher numbers representing better financial risk management and lower ones indicating less trustworthy behavior with credit cardsor other forms of borrowing money (like taking out personal loans).
Do you know how much debt you carry?
You don’t have to be an accountant or a financial planner to make sense of your credit report. It’s important for every adult to know how much debt they carry and whether or not their credit limits are in line with their balances. A good way to make sure you’re on top of things is by keeping track of your credit utilization ratio. If you want to know how to manage your debts you can check our blog here!
If you find mistakes in your credit report
In addition to checking your credit report once a year, you should also check for any unfamiliar accounts. This can be difficult if the account is for a store or service you’ve never heard of. If you see something like this on your report, contact the company and ask them to remove it from your report. You may have been a victim of identity theft!If youfind an error in your credit report, contact the credit reporting agency (CRA) that issued it. The CRA will investigate and correct any mistakes on your file.
●You can dispute an error by mail or online:
●By mail: Send a letter to the address on the bottom of page 1 of your annual credit report. Include copies of documents that support your position, such as payment receipts or other records that show you made payments on time and as agreed. Keep a copy foryourself because it may take several months before you receive a response from the CRA. Be sure to include enough postage so they can send their reply back to you free of charge.
●Online: Go to annualcreditreport.com, which is run by all three CRAs (Equifax®, Experian®, and TransUnion®). You’ll get an online form that lets you select which information in your report needs correcting, then upload supporting documents as attachments when prompted by this form’s instructions.
If you suspect identity theft
If you suspect identity theft, here’s what you should do:
●File a police report.
●Contact the three credit reporting agencies (Equifax, Experian and TransUnion) to alert them about potential fraud. You can file one report with all three or make separate reports with each agency. Make sure that you have your Social Security number on hand when contacting them so they have your correct information in their files if necessary.
●File a complaint with the Federal Trade Commission(FTC). The FTC will review your complaint and provide guidance on how best to proceed based on their findings. They also publish regular updates about new data breaches and ways consumers can protect themselves from becoming victims of fraud in these situations; it’s worth checking out regularly if you’re looking into this issue further!
Be vigilant about checking your credit history.
It’s important to be vigilant about checking your credit history. Credit reports are public records, so anyone with online access can view them. You should check your report regularly for fraudulent activity and updates that may affect you—for example, if a creditor has added or removed information from your report. If you suspect identity theft or see something that looks unusual on your report, contact the fraud department of the credit bureau that issued it immediately.
If someone has entered false information into one of your accounts or opened an account in your name without permission, they could use this information against you by creating additional accounts in which they’re not liable for late payments or other negative consequences until they’ve cleaned up their messes and gotten rid of any suspicious activity on their reports as well as yours.
You can also request an explanation from any lender who denies giving out a loan based on one section (one account) of otherwise clean credit history.