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VIEW ALL CREDIT RESOURCE LIBRARY DOCUMENTS
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How To Read Your Credit Report Once you have your free credit report you will need to following down through this step by step process. There are several different sections of importance in your credit file.
Depending on the credit report that you pulled, your information might be laid out differently. This is because each one of the credit vendors or credit bureaus have a different style of layout. However it is still the same concept when reading a credit report. PERSONAL INFORMATION In the top portion it should have your personal information listed on it. Your Social Security Number might not appear in its entirety. This is common, on the annual credit report web site you might have clicked on the dont include all of the social security number on the report. You want to make sure that your name is spelled correctly. You want to look at your middle initial to make sure that it is listed. If you middle initial is not listed and you have a common name, you will want to highlight this area. (highlighting allows you to start a list of things you will need to add to your dispute letter) You will want to look for alias, if you have used credit in the past under another name, such as your maiden name, sir name you will want to make sure that if there are names that you do not recognize in that section, you need to highlight them so you can address them in the dispute. (this is important because if you have a common name, other people's credit might be blended with yours in error). Once you have looked at this section and highlighted all of the areas that you feel are errors you will now proceed on to the next section.
RESIDENCE HISTORY It is important that you look at your current address, once you have listed that address to the credit bureau when you initially pulled your credit, the bueau will now record that as your current address. The main concept here is to make sure that your past rental or addresses are listed correctly and the time frames for them are correct as well. If a particular address has your residence time shorter or longer then what it truly is, you will want to highlight this area. (banks consider rental time and also the credit bureau uses the addresses to help identify you. Creditors when pulling your credit will also verify this information as a identity theft deterrent. Rental companies when they pull your credit will look at the length of time you lived at a particular address, this tells them items such as, how long they could project your rental - lease time, when considering you for a rental agreement. Also, employers sometimes use this to gauge the stability of certain potential employees, if someone is moving around a lot, it might look to a potential employer as you are not as stable as someone else because you have moved a lot in the last 2 years. EMPLOYMENT HISTORY This is very important, there are ups to this and downs to this section. The up to this is that the lender will use this to match against a verification of employment and also to see where you worked and match that against your credit application. Rental companies will use this to see if where your say you work is actually correct. You need to make sure that this section is correct, because you might need this as a back up reference in the future. However, there is a down side to this because if you have a derogatory account, they could pull your credit and locate you. Locating a customer is easy when they can pull your credit because of permissible cause they have the right to do it. They can use this information to find you and to mail letters to you and to also cross reference that against locator programs to get your home phone number. Although in today's technological market it is very easy to locate a consumer vs. the past outdated non technological means of tracking a consumer. It is in your best interest to make sure that your employment history is correct and up to date. If you are applying for a credit card or a car loan, those finance lenders look at this information to see if your application is correct but to also use that time to gauge your creditability factors. If your information is incorrect, it could look as if you are not reporting the correct information or that you are intentionally letting something out. CREDITOR INFORMATION The creditor will report information to the credit bureau in the following way: The account name, account number, date opened, date reported (current months hisotry) date of last activity (open accounts will report current month) number of late payments, payment status ( Installment accounts will show I-1 to I-9 depending on the derogatory status of the account, I-9 is the worse is typically notated for a collection charged off account, this will also show I-9 status for all collection accounts. R-1 to R9, M-1 to M9 depending on the creditor and depending on the credit reporting agency. Mortgages can show as installment accounts. C or O (are signals or statements of collection accounts this also can vary depending on the credit reporting agency). Bankruptcy status if account was included in a bankruptcy and if a house was foreclosed on, that will report as well, depending on the credit reporting agency it is possible that this effects the payment history to reflect 150F which means that the account was past due 150 days and that the account went into foreclosure and also it could show that the house was charged off/foreclosed. Comment Section (creditor comments, your comments, status comments IE. transferred to another lender) Status of account (current, past due, collection account, assigned to collector) Months reported (the length and age of the account). When reviewing this section you need to look at every aspect of each creditor account, you must make sure that you agree with the information, if you do not agree with any of the information highlight it so you can remember to put it on your dispute letter. COLLECTION SECTION In the collection section of your credit report, there will be the listing of your collection accounts. You will need to look at each account independently. The account should show the open date of the collection account, the date of last activity should be the last date of activity with the actual creditor, the months reporting should be new, the account last reported will be the current month, the activity section of derogatory accounts should not be reflected as rolling or compiling lates. You will see that you were late, if you agree that this is your collection account. However the account is not to report as 30, 60 or 90+ days late. The collection account is a ownership or a assigned charged off or placed for collection account. The creditor is the only one who can state that something is past due. The Past due section should not be completed. This is an opinion factor and has not been decided fully by the Federal Trade Commission. However, if this is an assigned collection account still owed by the original creditor then it can be stated that it is past due and it also can have a figure in that section. However if this account is not owned by the original creditor and if this account is not assigned by an actual creditor deemed by the FCRA or the FDCPA this account can not show past due, because at that point it is not past due with the current collection agency. However, as time goes on, you will see that the information will continue to report against you and it is best that you consider paying this account off or settling the debt (see debt settlement collection accounts) If the dates are not correct, highlight this area so you can dispute it. You will want to look at the old trade line with the original creditor if that account was not assigned or is not in an assigned status then the account on the original creditor side should be updated to report that fact. Also, when you are looking at the collection account reference numbers you need to see if it shows or references the actual creditor, if it is an assigned account it will show or should show in the reference number some indicator referencing the original creditor example: it will have three or four of that creditors name in the reference number (reference number is the account number that is assigned to an account, it is just like a creditor account number but because it references an account that was collected by or owned by someone in the past, it can only reference an account {Jargon}) If you you have multiple accounts listed on your credit report from the same collection company you need to look at the dollar figures, if the dollar figures are the same or similar and the account numbers are different, this is a collection tactic. Dispute that validity of the account number and the reference numbers when they are duplicated accounts with different reference numbers). PUBLIC RECORDS SECTION The public records section is very important to lenders and to potential creditors because it shows them a trend on a consumer. This section will show any tax liens, federal and state and also judgements and bankruptcy's filings. The information reported in this section will be the docket number (judgements and bankruptcy), reference number (tax liens) The status date of the public record, the filing date of the public record and the dollar figures that were awarded. The bankruptcy will not show a dollar figure associated with the filing or the record itself. The bankruptcy is a protected account, although it shows everything like the others do, the dollar figure will not show up on your credit report. When looking at this section you must make sure that if something is paid off or the status date is complete (bankruptcy) or released (tax lien) highlight incorrect items so you can remember to dispute them. Items like unpaid tax liens might not come off of your credit report. Bankruptcy can stay on your credit report for up to 10 years, judgements will stay on your account until statue of limitation runs out. (state specific) INQUIRY SECTION All inquiries for the last 24 months will show on your credit report. Soft credit pulls will show on your summary reports or on the reports that you get from the credit bureaus or a vendor or from annualcreditreport.com however, soft credit pulls usually do not show up on a lenders credit pulled report. The reason for this is mainly it is information that is not needed in consideration in their lending. Soft credit pulls are when a creditor wants to get a feel for you, without actually accepting an application from you. Once they actually get a credit application from you they are required to pull your credit (once they pull your credit it is considered to be a hard pull (creditor actually pulling your credit because you applied for credit) Soft credit pulls do not affect your credit because you have not asked them to pull your credit. Hard credit pulls when you did not give consent for a creditor to pull your credit can still effect your credit and the creditor can pull your credit under permissible cause if they currently have an account with you or they own a collection account and are tying to collection on it they will use the stance to pull your credit for locating purposes and by using the fact that they have the right to look at the credit of anyone they have as a customer, the credit bureau will allow them under permissible cause to pull your credit. Once the collection company has pulled your credit it might effect your credit in a negative manor. If there are inquiries on your credit report that were not authorized by you then you have to consider and reference it against your credit report, does that credit inquiry belong to a current creditor or collection company? Does that inquiry show as a soft credit pull or a hard credit pull ? (one authorized and one that does not effect your credit) If the inquiry was not authorized and they do not have permissible cause to pull your credit highlight it and dispute the inquiry. If you went to a car dealership or a mortgage broker shop and your credit was pulled multiple times in a short amount of time then this might have effected your credit scores. You msut then look at the fine print on your application, more than likely the car dealership or broker will have it in fine print giving them the authority to pull your credit. If it does not or someone did not have just permissible cause to pull your credit, dipute it. If there is an inquiry that is older than 24 month dispute it. Typically inquiries show on most lender pulled credit report only the last 90 days. Lenders want to look at what your history has been in this time frame, some lenders want to look at the entire list of credit pulls. The main reason that a lender might be interested in the most recent credit pulls is two-fold. The first reaason is to see how many times you applied for credit and to see or consider if there is a possible new trade line (new account) that has not reported yet. This is one reason that lenders pull credit right before they close on a transaction, to see if there were any new accounts that reported on your credit report. Because any new item or undisclosed item could effect the entire process of their approval such as debt to income comfort levels or other mortgages that showed up on your credit (anti-fraud deterrent). CONFIGURING OF ACCOUNTS Your credit file consists of many different aspects of your life. There are some accounts that report in different sections. Such as Domestic Relations accounts where they should always show in the creditor section with a I-1 status. These accounts should not be counted against or factored into your credit score as stated by the credit bueaus, however if the account is past due and the account has gone into the collection status and was intentionally moved there and the status was changed by the collection officer at the domestic relations office from a I-1 to a I-9 account then that will effect your credit score and is considered just as derogatory as a collection account even through it is not the same as a collection account and holds state jurisdiction on it, that reporting is state specific to your state laws, check with your attorney general office or department of state for further state laws concerning domestic relations. When considering this section "configuration of accounts we are speaking solely of times that can move from one section to another but still be the same account. Typically when one account goes from creditor to collection history the account must move in its entirety. It can not show up in both places. So you should not have a Bank of America account in the creditor section and then have the same account show up in duplicate format in the collection section, that is considered a duplicated account and should be deleted as inaccurate information. However, if a creditor decides to place the derogatory account in the collection section by sending it to an internal collection department it can list the account in that collection or charge off status but then keep it in the creditor section. If the account is moved over to the collection section typically it is assigned to a collection company. When it is assigned to a collection company the account can be placed inside the collection section and also if the creditor had already moved their own creditor then turned collection trade account over into the collection section, they must remove the trace history out of the creditor section. They can not double dip on your credit without just cause to do so. This is a disputable item, (example, double jeopardy). The main goal in this section is to have you trace backwards to see where an account originated from and to make sure that the past creditor has not doubled dipped against you. Verify that the old creditor showed a zero balance on the account, they can report it as sold, transferred or assigned to third party or collection company or to another department. They must stop reporting the account if it was assigned to a collection company or sold. If it is held internally for collection they can continue to report until such time as you pay the account or if they decide to assign, charge off and sell the account etc. Check your date, trace the accounts backward to insure accuracy and dispute anything you feel is inaccurate or misleading information. Uphold your federal rights! |
