How to Read Credit Report Comments

By federal law you are entitled to one free credit report a year, but reading this report can be confusing. Given its importance, an understanding of the terminology used is vital to spotting problems before they affect your ability to finance your home or vehicle. Review, section by section, what appears on a credit report from any of the three reporting agencies.

Instructions

1

Review the personal information section. The most important thing about this section is make sure your data is accurate. Make note of the report number, as this will allow you to identify yourself if you call one the credit agencies with questions. Don't worry if your employer is not listed, as not all employees send this data to the credit bureau.

2

Review the public records and adverse accounts section. These are your defaults and repossessions. Sometimes the report will tell you when these items expire. These negative items are removed in seven to ten years.

3

Review the accounts in good standing section. These are the loans and financed items currently in your name that demonstrate to your creditors that you are a good risk. They can stay on your record for 54 months.

4

Review the credit history requests section. These are the times you have had your credit checked. Creditors use these to see how much shopping around you may have done when looking for credit, and how many pending purchases you may have in the works.

5

Review the personal statement section. This is a statement you may add to your credit report, usually explaining any negative items above. You can use this space to warm creditors that your identify has been stolen or describe complications arising from divorce.