One of the most important documents in your life is your credit report. You’ve taken the advice of every financial expert to get a credit report. However, now that it is in your hand, it is difficult to make heads or tails of all the numbers and codes that are on the report. Understanding the information that is contained on your report will help you to read through it and uncover the issues, problems and inaccuracies that may be on your credit report. How to read a credit report is fairly easy if you have the right information.

The first thing that you should know is that there are three credit reporting agencies. When you get your credit report, you should get a copy from each of the three major credit bureaus, Experian, Trans Union, and Equifax; information about a free credit report on line can be found on the Internet. Because credit reporting is voluntary, the creditors that report your information will often report only to the agency that they subscribe to if they choose to use any one of them at all. For this reason, the information on one of your reports might be different than what is on another. You must read all 3 credit reports to be thorough when you are tracking your credit. It is important that you learn how to read a credit report for all three agencies.

Identifying Information

This is the part of the credit report service that is used to identify you. When you receive your credit report, look this information over carefully to make sure there is no unusual information. There may be variations in the way your name is spelled. If something seems wrong on your report, check it out. If you have been denied credit, this may provide an answer to your question “Why is it important to review my free credit report?”

Credit History

For each of the accounts on your credit report, there will be the name of the creditor and your account number with them. At times the number will be scrambled on the report. It is possible to have more than one account with a single creditor. This usually occurs when you use a number of different products from the same creditor. The information that is included for each account will include:

  • The date that the account was opened

  • The type of credit that is involved such as a car loan, mortgage loan, credit card etc.

  • The number of people on the account

  • The amount of the loan or the credit limit on the account

  • The balance on the account

  • The current status of the account which could be paid, closed, open, or inactive

  • Information regarding how well you paid on the account

There is also information regarding your financial public records and this will include tax liens, bankruptcies or judgments against you. For a good credit score, this part of your report should be blank. Learning how to read a credit report will include information that you don’t want to see as well as what you do want to see on your report.