The information listed on your credit report determines whether your next loan application will be approved and what interest rate you will pay on that loan. Your credit worthiness is determined by the financial information stored about you with the three major credit bureaus. The three bureaus are TransUnion, Equifax and Experian. Although your actual FICO score is not on any of these reports, the information in the pages gives an in-depth view of what makes up that number.
Identification
Who you are and where you've lived is the first block of information you will see on your credit report. Equifax reports that the identifying information it includes is your name, address, Social Security Number, date of birth and employment information. This information comes to them through the applications you submit for credit. Unknown addresses listed on your credit report may be the first indication that someone may be using your identity.
Account History
The most important information on your report to potential creditors is how you have handled similar relationships in the past. TrueCredit, operated by TransUnion, says "Your credit report lists a summary of the details and terms for each account. This summary includes information about the account number, condition, balance, type and pay status for each account." Any accounts that you have settled, defaulted or have been delinquent on will be red flags that work against you. Open accounts can actually work against you as well. It may signify to the prospective lender that you will be over-extended if they offer you a loan.
Public Records
If you've been sued, it will be in your credit report. Generally, anything handled by a court of law becomes public record for anyone to see. In Kiplinger's Personal Finance Magazine, Elizabeth Kountze explains that "Public records will reveal court records of bankruptcy, tax liens or monetary judgements against you." These kinds of records are interpreted as marks against your character and can negatively influence a lender's decision. Tax liens are a deterrent because companies will be aware that the IRS is likely to get money from you before your other debts are paid.
Inquiries
Anytime you fill out an application, there is an inquiry into your credit report. These inquiries are listed on your credit report. The number of inquiries in a given time period impact your credit score and could lower it a few points. Lenders typically look at inquiries for the last two years to determine how many loans you've applied for.
Credit Management
Experian advises that to manage your credit you should set a budget and live within it. The company advises you not to use credit if it forces you to live beyond your means. Paying bills on time shows creditors that you are a responsible money manager. Length of employment and length of residence also play a factor in demonstrating your stability to creditors.
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