Next to your medical profile and motor vehicle record, your credit report may be the most important document you’ll ever need.
Contained within your credit report is a three-digit number that signals to lenders whether you’re a good credit risk, or someone who’s had difficulty paying bills, from time to time.
Your credit report contains a wealth of information that is broken down into five distinct sections:
- Personal identifying information such as place of employment, address, and any variations of the name are listed first. This includes misspellings and other names or initials used in the past when applying for credit.
- A summary of credit accounts lists the number of accounts held (both open and closed) as well as any current balances.
- Account history is included in the credit report and makes up a large part of the credit score as well. Account numbers, the status of each of the accounts, and how promptly they have been paid are documented here.
- The public records section of the report identifies any liens, judgments, or bankruptcies in your name, or associated with your name.
- Credit inquires (both hard and soft) are included in the credit report. These reflect the number of times prospective lenders, landlords or future employers access your credit report. Soft inquiries only reflect credit inquiries made for promotional purposes, or for background checks and will not hurt credit scores. Too many hard inquiries however, may make an applicant look bad in the eyes of future lenders and can negatively impact scores.
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