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Public Knowledge Center |
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What is a Credit Report and What Information is in it?
Who Creates My Credit Report?
There are three primary national credit bureaus in the United States that serve as central repositories of credit information on American consumers: Experian, Equifax, and TransUnion. A fourth credit bureau, Innovis Data Solutions, essentially operates more as a data broker. (Innovis gathers financial records about consumers and sells them to creditors who compile mailing lists, or uses the information to generate pre-screened offer lists.)
In addition to the three primary national bureaus, there are over 1000 local and regional bureaus, most of which are either owned by or are under contract with one of the national bureaus.
Collectively, these companies receive, compile, and sell reports detailing the financial activities and the overall credit and credit-related payment history of each consumer.
What Information is Included in a Credit Report?
Consumer credit files contain personal and financial information about you such as:
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Full name
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Date of birth
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Social Security number
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Current and previous addresses
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Telephone number
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Current and previous employers
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Other names that you may have used, such as married or maiden name, or aliases included on a credit application
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Certain public records such as bankruptcies, liens, and judgments
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Information about felony convictions
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In some cases, limited types of non-specific medical and insurance-related information
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The companies that have recently reviewed your credit report as a result of your having applied for credit. These are referred to as credit inquiries.
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And of course, detailed account and payment history for credit related accounts reported to the credit bureaus
Why is My Credit Report Important and How is it Used?
First and foremost, your credit file is used by prospective credit grantors to determine your credit worthiness when applying for credit. However, it is also used to establish interest rate percentages on loans and credit accounts, set the cost of your insurance premiums, reviewed by many prospective employers, and a wide range of other purposes.
Despite the importance of these files, it has been estimated that as many as 70% of all credit reports contain errors, and 25% of these are so inaccurate that a consumer may be rejected for a loan or employment. As a consumer, it is critical for you to know and regularly review the information contained in your credit report, and to ensure that the information reported is accurate.
Two Types of Credit Reports
There are two general types of credit records: a Consumer Disclosure or "Personal Credit Report", and a "Credit Report". The terms are often used interchangeably, but there are important differences.
• A "Consumer Disclosure", or "Personal Credit Report" as it is also called, contains all of the information that a credit bureau has compiled and maintains about the consumer, as well as a record of all credit inquiries, or requests made for information contained in the report by prospective credit grantors and companies who use pre-screened lists to make offers for credit and insurance.
• A "Credit Report", the type used by prospective credit grantors and other businesses with a qualified need for the information, does not contain all of the information that a credit bureau maintains on the consumer. For example, because creditors typically look unfavorably upon a high number of credit inquiries, "Credit Reports" exclude all pre-screened offer inquiries. They also exclude any medical information and certain other types of sensitive information not necessary for the credit decision process. There is also a form of limited credit report, which is used by prospective employers and landlords. This type of credit report displays overall general credit history information, but excludes account numbers for the consumer's privacy and protection.
Reviewing Your Credit Report
You should carefully review your personal credit reports, from each of the credit bureaus, no less than once per year. Reviewing the report from each bureau is important because not all creditors report to all of the bureaus, and the information contained in the reports can vary significantly between each bureau. While reviewing your report, be alert for any inaccuracies, omissions, and of course, unknown accounts. Other items to be alert for include:
• Unknown names or aliases
• Unknown addresses
• Unknown employers
• Unknown telephone numbers
• Other Social Security numbers which may have been linked to the your credit report
• Unknown or incorrect public records such as bankruptcies, judgments, or criminal convictions
• Account balances that vary significantly from your own records
• Unusual or unknown credit inquiries, or a large number of inquiries in a short period of time
Note: In the case of credit inquiries, be aware that many companies routinely make "pre-screened" credit offers based upon pre-set criteria. This screening process may result in inquiries being displayed on the Consumer Disclosure (or Personal Credit Report), that you do not recognize, and that are not easily distinguished from those inquiries resulting from actual credit applications.
Any of the preceding discrepancies or the appearance of unknown or unrecognized information may be a sign of Identity Theft or attempted Identity Theft, and you should notify the credit bureau immediately following the bureau's established dispute process. Because most creditors report to the credit bureaus only once per month, and many only once per quarter, a new account that resulted from a credit inquiry may not appear on your credit report for some time after the initial inquiry was made.
FRAUDFacts Tip: Every credit report generated is assigned a unique report reference number. This number will typically appear on the first page, or cover page, of the report. Any time that you receive a copy of your credit report, you should always note the report's unique report reference number because you will need to include this number on any notice of dispute regarding an item or information that appears on that specific report.
©Copyright 2008 by Michael Barnett. All rights reserved. Unauthorized use, copying, or distribution without permission is prohibited.
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