What is a credit report? A credit report is actually an official record of the responsible repayment of credits. The report is maintained by three major credit bureaus namely Experian, Equifax and TransUnion. These agencies compile information from a wide variety of sources in order to compile data which reflects well on the creditworthiness of the borrower.
The main purpose of credit reporting agencies is to provide the general public with reliable and unbiased information about their credit worthiness. Credit reporting agencies compile the information submitted by lenders, banks and employers. The data gathered by these agencies is then sent to lenders, banks and employers to determine the creditworthiness of an individual. Credit reports are important for individuals, home buyers and employers to help them assess a person’s financial condition. These reports are also used for personal purposes like obtaining loans or mortgages, availing insurance, leasing property or purchasing a car.
Lenders use credit reports to understand your current financial position. The lenders use this information to evaluate your financial capacity and whether you are able to repay a loan. If the lenders find that you are suitable for a loan but are short of money, they may decline your request. Similarly, if they find that your credit report indicates that you have many overdue accounts, they may decline your request for a mortgage.
Lenders use credit reports to determine your credit limit. Each credit account is assigned a credit limit. The credit limit of each account is determined by the value of the amount of borrowings which can be accessed by the lender. If you pay a certain amount on time each month, the lenders consider your payment history to be consistent and your payment history to be good. If you pay late, the lenders consider that you have a poor payment history.
A common way of getting credit information report is by making several applications for loans at the same time. When you make a credit application, the lenders need to obtain your personal details, including your address, contact details and your credit information report. Most of the time, it takes around 7 or eight days to get these details. If you make a single credit application, the lenders will get your personal details and the credit information report from the credit bureaus. In the case of multiple applications, you will often be requested to complete a short application form that asks for more personal details.
Some people prefer to use the free credit reports that are available from the main credit bureaus. The main credit bureaus are Experian, Equifax and TransUnion. You can get a free credit report from each of the three bureaus. However, these reports do not contain information such as the lender’s credit history and they are not considered the most reliable because they are usually made by brokers who work for one particular bank or lender.
Experian is considered the best and most trusted of the bureaus. Experian makes money by selling its database of consumer reports to lenders. The Experian website does not reveal how much it costs to access its database. To get the full list of names, addresses and the other vital personal data, you have to pay a fee. Some people do this to monitor their lender and make sure that their lender is sending them the right credit score on the basis of the information contained in the Experian database. The fees charged by the Experian websites may vary according to the number of reports desired.
If you want to avoid the fraud that is committed by identity thieves by monitoring your credit reports, you have to subscribe to one of the three free credit reporting agencies. These agencies are Equifax, Experian and TransUnion. You should remember that subscribing to one of these agencies does not remove your identity from any criminal records. In the US, only the Federal Trade Commission has the power to remove someone’s identity from a list.