The 411 on Understanding Your Credit Report
As a responsible consumer, you pull your credit report on an annual basis. You receive the report in the mail and you sit down with a fine tooth comb to review the information. The only problem, you don’t know how to read it or what you are looking for. Reading a credit report can be confusing to a consumer but it does not have to be. Here is a simple explanation of how to read your report and what to look for so you don’t get overwhelmed.
Your credit report is made of four different sections. The order of the sections depends on which report you are reviewing but there are always four main categories: Personal Information, Public Record Information, Account Information, and Credit Inquiries.
The Personal Information section of your credit report is fairly straight forward. It includes your full name, other names you may go or have gone by, social security number(s), date of birth, employment history and current and previous addresses.
The Public Record Information section of your report refers to court records that could affect your creditworthiness. Bankruptcy filings are the most common tradelines listed in this section, but you will also find liens, court judgments and other financial related lawsuits, including child support payments. Public records can last between seven to ten years depending on the entry and the state you reside in. Each public record will include the type of record, the status of the account, the date if was filed or reported, the reference number, the release date (if any), the court in which the record was filed and the dollar amount filed against you.
Your Creditor Information section makes up the largest portion of your credit report. Most credit reporting agencies divide this section into two categories, positive accounts and negative accounts. In this section you will find all of your existing accounts and the specifics of each account you maintain. Reading this section of your report can be complicated but it does not have to be if you learn the language. Each account will be listed separately with some basic information usually written in credit reporting code. The information will include the status of each account, the responsibility of the account, balance information, the most recent payment, past due information and your credit limit. Under each account, the credit reporting codes will be listed. Below is a list of the majority of the codes with an explanation of what they mean.
CURR ACCT: The account is current, paid in full and in good standing
CUR WAS 30-2, 60-, 90-, 120-: The account is current but was 30, 60, 90, 120 days late twice; the number after the dash corresponds to the number of times you were late in making payment
PAID: The account balance paid off and account is inactive
CHARGOFF: The unpaid balance on the account was charged off by the credit grantor, who is no longer seeking payment of the balance and the account has most likely been sent to collections
COLLECT: The past due account has been sent to collections
FORECLOS: The property was foreclosed on by the bank
BKLIQREQ: The debt forgiven by Chapter 7, 11 or 13
DELINQ 60, 90, 120: The account is 60, 90 or 120 days past due
The Credit Inquiry section of your report includes individuals or businesses who have pulled and reviewed your credit report within the past two years. There are two types of inquiries, regular or what some refer to as “hard” inquiries, and account reviews, or what some refer to as “soft” inquiries. Hard Inquiries are made by lenders when you apply for a loan or for credit. These inquiries affect your credit score, especially if too many inquiries are made at one time. Soft Inquiries are those made by an existing creditor or for marketing purposes. Soft Inquiries do not affect your score and can only be seen by you.
If you are in need of advice or assistance relating to your credit report, contact SmithMarco P.C. for a completely free case review.