A credit report is a record of your credit history, issued by
three credit-reporting agencies: TransUnion, Equifax and Experian.
A credit report includes:
- Identifying Information: name, Social Security
number, date of birth, current and former addresses, spouse and
- Your Credit: information about your
current and past loans, credit cards, and mortgage loan details
including opening date, loan amount or credit limit, current
balances, and timeliness of payments.
- Public Records: information on court
judgments, tax liens, accounts in collection status, foreclosures
- Inquiries: a list of companies that have
requested a copy of your report.
A credit report does
NOT contain criminal, medical or bank account information.
Your credit report serves as a financial reference for lenders,
employers, and other businesses as permitted by law. To obtain a
credit report, the requester must meet "legitimate business need"
criteria established by the Fair Credit Reporting Act.
Who can access your credit report?
- Lenders: when you apply for a loan, lenders
may review one or all three agency credit reports to determine how
you have handled past loans. Lenders may also request your credit
report at intervals throughout the life of your loan to assess any
changes in your credit history or to aid in collection
- Employers: current and potential
employers may pull your credit report, but only with your
permission. A permission statement is usually included on the job
application. Credit reports provided to employers are different
from those provided to lenders. An employment credit report
excludes certain personal information, such as account numbers,
birth date and marital status. An employment inquiry does not
affect your credit score, and only appears as an inquiry on a
credit report issued to you personally.
- Apartment Rental: most landlords review
your credit report as a component of the application
- Utilities: utility companies, including
cellular and cable providers, review your credit report during the
contract approval process. Your credit report may determine if, and
how much, of a deposit will be required.
- Insurance: auto and homeowners insurance
companies use credit report information, along with other factors,
to help predict your likelihood of filing an insurance claim. A low
credit score could result in a higher premium.
- Court Order: a credit report can be
obtained through a court order or federal jury subpoena.
"Hard" Inquiries vs. "Soft" Inquiries
A hard inquiry occurs when a business obtains your credit report
in connection with a credit application you initiated. Hard
inquiries appear on your credit report and may affect your credit
score. However, multiple inquiries within a few weeks will appear
on your credit report as one inquiry, so your credit score is not
penalized for loan shopping.
A soft inquiry occurs when your credit is checked for other
reasons, such as employment inquiries, preapproved credit offers,
and personal requests for your own credit report.
Credit Reporting Cycle
Credit Reporting Cycle
To understand how credit information is collected, let's look at the reporting cycle.
The three credit reporting agencies (Experian, Equifax and TransUnion) update your credit report as they receive new information from creditors. When you apply for or obtain new credit, or contract for a utility service, your personal and loan information is reported to the credit bureaus. Creditors report initial loan terms and provide monthly updates on outstanding balances, and the timeliness of your payments.
Credit reporting agencies also collect public record information from state and county courts, and information on overdue debts from collection agencies.
Creditors and other sources may not report information to all three agencies, so your reports from each agency could differ.
Your credit history stays on your report for a specific number of years, based on the type of information.
Each credit-reporting agency calculates a credit score based on
your credit history. Credit reports contain many pieces of
information, so the score serves as an objective tool to help
lenders assess your credit risk. Your score affects the credit and
terms made available to you. A higher score provides access to more
financial options and better loan terms. Your score can change as
new information is received by the credit reporting agencies.
Understanding what affects your credit score, and how it's
calculated, will help you take the appropriate steps to build or
improve your score.
Credit scores are based on a FICO model developed by Fair, Isaac
and Company. Each credit-reporting agency uses a different name,
and a slight variation of the model for their credit score. That's
why your score can vary slightly by agency. Scores range from 300
to 850 and are determined by a mathematical equation. The factors
and percentages in the chart below vary slightly by reporting
agency and for different population groups, such as those with a
very short credit history.
Monitor Your Credit Report
Monitor Your Credit Report
Since your credit report is considered in decisions that affect
many aspects of your life, you'll want to ensure it contains
complete and accurate information. A regular review of your report
will identify clerical errors, detect incorrect information, or
reveal identity theft (when someone falsely uses your personal
information to obtain credit).
The Fair Credit Reporting Act guarantees you free access to your
credit report once every 12 months, from each of the three
nationwide credit reporting companies: Experian, Equifax and
If you have not accessed your free credit reports in the last 12
months, the Federal Trade Commission encourages you to visit
the only authorized source for your free annual credit report.
Consider staggering the three agency reports throughout a
12-month period to provide a more frequent review. If you plan to
finance a home or car, order a credit report a few months before
your purchase so you can correct any errors that could hinder the
Contact the credit-reporting agency directly to report any
discrepancies. The agency is required to investigate your complaint
within 30 days.
Your free credit report does not include your credit score.
However, the central website provides you an opportunity to
purchase your credit score, including an explanation and advice for
improving your score.
Credit Reporting Agencies