Your credit report is a detailed summary of your credit history that’s prepared by a credit bureau. Since there are three major credit bureaus — Experian, Equifax, and TransUnion — each person has three separate credit reports in their name.
Details in your credit report include personal information, as well as all of your consumer credit card and loan accounts, their balances, and when they were opened and closed. Your payment history is also listed, along with details on late payments, accounts in collections, liens, or wage garnishments. Negative information typically remains on your report for seven years, except for Chapter 13 bankruptcy, which stays on for 10.
Why your credit report is important
Your credit report is important because it’s used to determine whether you are eligible for new lines or credit, and if so, the terms of your loan. While positive information can help you qualify for loans with the best terms, negative reporting can mean being denied credit — or having to pay a higher interest rate.
What’s more, employers in most states are allowed to get your consent to access a modified version of your credit report before hiring you, which could leave you without a job if you look like you have been irresponsible. Insurance companies may also access your credit report to determine insurance rates, so you could pay more for auto coverage if your credit is poor.
The difference between your credit report and credit score
Your credit report is not your credit score. Your credit report is a detailed list of your credit history, but your credit score is a three-digit number — usually between 300 and 850 — that gives a snapshot of how good your credit is.
The most popular credit score is the FICO score. While lenders will only see your credit score when considering you for a loan, the information in your credit report is the basis for that score.
How to access your credit report
You can get one free copy of your credit report from each of the credit reporting agencies for free each year via AnnualCreditReport.com.
Once you get it, check for errors. Check that each account is actually yours and the balances and payment history reported are correct. Fact check your personal information, and read though the public records section. If you have tax liens, bankruptcies, judgments, or lawsuits in your history, they will be listed here. Also check credit inquiries. If you have applied for new credit, these inquiries will be listed on your credit report.
If you find errors on your credit report, disputing them is crucial. Incorrect information on your credit report can damage your score and make it harder for you to qualify for loans and lines of credit with the best rates and terms.