Everyone has heard of a credit report. But many people don’t know exactly where to get it, or what to do with it when they have it. I’m not a financial expert, but these are some tips I’ve learned along the way on how to get and use your credit report. It’s also important to do your own research when determining the use of your credit report.
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How to Get and Use Your Credit Report
What is a credit report?
It’s basically a track record of your past financial performance.
What does it track?
It looks at when you’ve paid your bills, the amount of credit you currently have on your cards, how much debt you owe, etc. In other words, it lets any financial company you apply to know your past behavior.
This helps them determine whether or not to give you a loan, mortgage, or credit card. It also determines what the interest rate will be. Even college loans are chosen based on your credit history. In other words, if you don’t have a good financial past, your children might not get into the school they want.
So what’s a good credit score?
Generally, one at seven hundred or above will probably net you the best interest rates. You will be able to borrow more money as well.
Who tracks it?
The three major bureaus are Experian, Equifax, and TransUnion. Which one should you get it from?
You can get it from just one. But this might not be the smartest option, because the finance companies look at all three when determining your credit worthiness. If you don’t inspect each one, then you risk missing a major mistake.
You have two options: you can either go to each credit bureau site separately and get the report, or you can get all three at a third party site. The second option is faster and easier.
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How do you use them once you get the reports?
The most important thing is to ensure there aren’t mistakes. If there are, then you need to dispute them.
Often times a financial record will be recorded the wrong way by one of the bureaus. This is actually more common than you might think.
Remember, they don’t check with each other to verify everything is correct. So not keeping track of this might prevent you from getting the loan or credit card you want.
It also helps prevent identity theft. Since you can track all your financial history, it will be easy to see if there are charges you don’t recognize.
The Bottom Line
Make sure you look carefully on each report to verify that everything is correct. This could easily be the difference between getting that loan or not. It will also have a huge effect on the interest rate you pay. Remember to keep up with all types of payments, including your credit cards.
