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Credit Report Primer

Credit Report Primer

With more consumer credit extended each year through home mortgages, car loans and credit cards, understanding the role of credit reports is important for anyone planning to borrow money. A credit report is simply a document containing a detailed history of a consumer’s credit. Creditors—banks, lenders, credit card issuers and retailers—provide information to credit bureaus about the status of each borrower’s accounts. They also rely on the information contained in the reports when deciding whether to offer credit to a consumer and when determining what terms—down payment, interest rate, loan length—to offer.

Credit Report Details

Credit reports contain several important pieces of information about each consumer, including identifying information, credit information, public record information and recent inquiries. Identifying information may include the consumer’s name, birth date, Social Security number, current and past addresses and current and past employers. Credit information may include a list of current and past accounts with banks, credit card companies, utilities, retailers and other lenders, as well as the each account’s opening date, credit limit and payment history. Public record information may include court records showing arrests, tax liens, bankruptcies or court judgments. Recent inquiries may include information regarding creditors or other entities that have requested copies of your credit report.

Credit Bureaus

A credit bureau, also known as a credit-reporting agency, is a company that collects and compiles information about consumers’ credit activities and makes the information available for a fee to credit grantors and other entities. In the United States, the three major credit bureaus are Equifax, Experian and TransUnion. Federal law requires each of these companies to provide consumers with a free copy of their credit reports annually upon request. For details, visit or call (877) 322-8228.

Credit Report Access

Federal law regulates who has access to consumer credit reports. Credit bureaus may provide your information only to entities with a legitimate need, including current or potential creditors, employers, insurers and landlords. In some cases, such as employers and potential employers, a consumer must provide written consent before the credit report will be issued.

Credit Report Errors

Periodically, incorrect information appears in a consumer’s credit report. Under federal law, the creditor that reported the error and the credit bureau are responsible for correcting inaccurate credit report information. When a consumer finds a credit report error, he or she should notify in writing both the credit bureau and the creditor that supplied the incorrect information. Notification should include details about the error and copies of any documents that prove an error has occurred. The credit bureau and creditor are responsible for investigating errors and correcting them if they are found to be legitimate.