(Note: If you order credit reports from our site, it will come in an easy to ready format)

Your credit report reflects your financial position in life. Its contents can affect your financial future, either negatively or positively. Sometimes a lost job offer or a refusal for loan is the result of your credit rating. Thus, it is very important to know how to read your credit report.

The information given in the credit report is classified into four categories:

Personal Information:

Personal details, such as name, date of birth, current employer, spouse’s name and former employers are included in this section. The information should be correct, right down to the spelling of your name.

Reported Accounts:

The Reported Accounts section is divided in two sub-categories:

a) Monthly Accounts: The credit history given by insurance companies, financial organizations, oil and gas companies and department stores are mentioned under this section.

b) Default/Collection Accounts: Unpaid electricity bills, telephone bills, installment loans, etc. are featured in this section. A thorough check of this section sometimes reveals missed payments, even though you have made the payments.

Public Information:

Information that is of public interest, like bankruptcies, lawsuits, court judgments and debts come under this section. Bankers, landlords, prospective employers and insurance companies refer to this section of the report before making any decisions. Neglecting any negative information, even if erroneous, could be detrimental.

Inquiries:

All credit inquiries made are included in this section. It helps to keep a check on the number of inquiries made by banks, companies, landlords and employers – too many inquiries in a short period of time can cause your credit score to go down and are a red flag to potential creditors.

Time Period Of The Information:

In cases where individuals have applied for bankruptcy, the information stays on for 7 years from the last transaction.

Some Important Abbreviations In Your Credit Report:

Account Details:

J = Joint

I = Individual

U = Undesignated

A = Authorized User

T = Terminated

M = Maker

C = Co-maker/Co-signor

B = On behalf of another person

S = Shared

Type Of Account:

O =Open Account

R = Revolving amount (amount due can change every month)

I = Installment (fixed amount due every month)

Payment status:

0 = Approved (account is either too new to rate or not in use yet)

1 = Paid according to agreement

2 = 30 or more days after due date

3 = 60 or more days after due date

4 = 90 or more days after due date

5 = 120 or more days past due date or is a collection account

7 = Making payments according to a wage earner plan or any other arrangement

8 = Repossession or recovery

9 = Charged off account

It is imperative to ensure that any negative errors in your credit report are fixed, as a lot depends on it, including your financial credibility. You can dispute any incorrect items with the credit bureau that they appear on. It is a good idea to obtain a copy of your report every 6 months. An even better idea would be to subscribe to a credit monitoring service – for a small monthly or yearly fee, the service will monitor your credit report and notify you of any changes, however small, that are made to your credit report.