As kids, report cards signaled how we were doing in school in subjects like math and history. Long after graduation, we’re still being graded – but on how well we handle credit.
What is a credit report?
Your credit report is a collection of personal and financial information compiled by the three major credit bureaus. A credit report shows how responsible you are when borrowing money and paying your bills.
FICO® and VantageScore use the data in these reports to calculate your credit score. The stronger your report, the higher your score. You need a strong credit score to get approved for loans, credit cards, and even apartment rentals.
Why should you check your credit report?
Although you might not look at your credit report often, it significantly impacts your everyday life. Incorrect entries on a credit report could lower your score, making it harder to get approved for credit cards, mortgages, and personal loans. A low credit score can also increase interest rates when you borrow money.
Errors are more common than you’d think. The Federal Trade Commission (FTC) discovered that a whopping 20% of Americans had errors on their credit reports.1
That’s why understanding your credit report is crucial — and why you should check your credit reports every year. But how do you get your hands on one?
How to get a credit report
As a consumer, you have a right to access your credit report every year, and you have a few options to do so:
From the credit bureaus
You can request a free copy of your credit report from each of the three major credit bureaus once a year (every 12 months, not every calendar year). Follow the links below to request your report:
Pro Tip: You don’t have to get all three at once! Spread them out throughout the year to keep a better eye on what lenders are reporting.
Sign up for free credit monitoring services
You can also get regular access to your credit report if you sign up for a free credit monitoring service.
Some financial institutions may also give you free access to credit monitoring with specific accounts. Find out how you can track your FICO® Score in the Chime app, for free!
Exercise other options
Once a year, you can go to AnnualCreditReport.com to get a free copy of your credit report from all three bureaus at once.
And if you apply for a credit card or loan and are rejected, you have the right to a free report to understand why.
How to read a credit report
What does a credit report show? Each of the credit bureaus organizes its reports differently, but in general, you can expect to find information across five sections:
1. Personal information
In this section, you’ll find your:
- Name, including aliases or former surnames (check all spellings to ensure they’re right!)
- Social Security number
- Date of birth
- Current and previous addresses
- Phone number
- Employment history
2. Credit history
This is the most important part of your credit report. The credit bureau will list your:
- Current and closed accounts
- Payment history
- Amounts owed and total credit limit for each account
- Current balance
The credit report will also note any loans you’ve defaulted on or have gone to collections.
You should verify that all the information is correct, but specifically, look for:
1) accounts with bad marks that should be in good standing, and
2) accounts you don’t recognize.
Why it matters: On-time payments account for 35% of your FICO credit score3 (40% for your VantageScore4), and credit utilization follows closely behind at 30% (20% for VantageScore). If your credit report has errors that misrepresent your payments or how much credit you’re using, it could drastically affect your credit score.
3. Public records
Though this section previously included tax liens and civil judgments, it now only highlights bankruptcy filings. If you haven’t filed for bankruptcy, this section will be blank.
Whenever someone pulls your credit report to review your information, it results in a hard inquiry on your report.
The occasional hard inquiry isn’t terrible for your credit (and they fall off the report after two years5). However, multiple hard inquiries in a short time frame can signal to lenders that you’re scrambling to acquire credit. Pick and choose credit applications carefully.
Did you know? You can apply for Chime’s Credit Builder credit card without a credit check. That means you can start building your credit score with a secured credit card with no hard inquiry on your report.2
5. Consumer statements
As a consumer, you have the right to leave a comment on your credit report to clarify anything you think lenders should know.
For instance, if you fell behind on your credit card bill because you were laid off, you can add a consumer statement explaining this.
This won’t impact your credit score, but it does allow potential creditors to get a fuller picture of your finances – and may result in a loan approval even if your score has suffered.
Credit report vs. credit score
Your credit report and credit score are closely related but different. Your credit report is a collection of information about you that represents your credit history: what credit you have and how you pay it back.
Based on the information in these reports, credit score companies like FICO and VantageScore use formulas to calculate a three-digit score. This score, typically from 300 to 850, represents how well you manage credit.
According to FICO’s system, here’s what each credit score range means:6
- 579 or below: Poor credit (or no credit history). Lenders view these consumers as large risks and may not offer credit. If they do, the rates and fees could be high.
- 580 to 669: Fair credit. While below average, this credit score range is often enough to get qualified for certain types of loans.
- 670 to 739: Good credit. Borrowers with good credit scores can typically get various loans, including credit cards, mortgages, car loans, and personal loans.
- 740 to 799: Very good credit. These borrowers can easily get loan approval with reasonable rates and low fees.
- 800+: Exceptional credit. Borrowers with an 800+ credit score will get the lowest rates for credit offers and can often get loans and lines of credit without fees.
What to look for when reading a credit report
You’ve got your credit report, and you know how to read it, but how do you analyze your credit report? What are you actually looking for? Check to make sure:
- Your personal and employment information is correct.
- All of your credit accounts are being reported.
- The information for credit accounts is accurate, including balances, credit limits, and payment dates.
- There aren’t any unexpected credit accounts listed.
In short, you’re confirming that all the info is correct and nothing is missing. After all, if you’re working hard to raise your credit score, you want to ensure that the lender’s reporting your on-time payments.
What to do if there's an error on your credit report
Accidents happen more often than you’d think. If you notice a closed account still listed as open, an account incorrectly marked as delinquent, the incorrect balance on a mortgage, or any other mistakes, you can file a dispute with the credit bureau.
You’ll also want to contact the specific creditor to discuss why they’re reporting incorrect information.
Need help contacting credit bureaus? The Consumer Financial Protection Bureau offers detailed instructions and sample letters for disputing errors on your credit report.
What to do if there's fraud on your credit report
If you notice an account on your credit report that you don’t recognize, take the proper steps in case it’s fraud. It could be a legitimate account for someone with a similar name, in which case it’s just a matter of setting it straight with the credit bureau.
But it’s also possible that someone fraudulently opened a credit account in your name. This is called credit identity theft, and it’s important to act quickly.
Here’s what to do:
- Contact all three credit bureaus to place a fraud alert on your report; you can also freeze your report.
- Contact the creditor to report the fraudulent account.
- File a police report with your local police department.
- File a report with the FTC.
- Continue to monitor your credit report for further fraudulent activity.
Keeping tabs on your credit matters
Knowing your credit score is helpful before applying for a credit card or loan, and knowing that your credit report is accurate – with up-to-date information and no instances of fraud – is even more critical.
Need help getting your score up to snuff? Here are seven steps to improve your credit score this year.
How long does information stay on my credit report?
Open credit accounts in good standing can stay on your credit report indefinitely, and closed accounts in good standing stay on for ten years. Negative marks generally fall off in seven years. Chapter 7 bankruptcy, however, lingers for ten years.
Credit inquiries, which appear when you apply for credit, fall off after two years.6
How often is a credit report updated?
Lenders typically report to credit bureaus at least once a month, but it can vary. If you have debts with multiple lenders, your report may update multiple times a month as credit bureaus receive information.
As a result, your credit score will typically update at least once a month, though it could update more frequently.7
Who can see my credit report?
You have access to your credit report (you get one free report per bureau every year), but other individuals cannot freely access your report.
For a lender, creditor, landlord, employer, insurance company, or other institution to access your report, they need “permissible purpose,” as established in the Fair Credit Reporting Act.8
Are all inquiries hard inquiries?
No, there can also be soft inquiries on your credit report. These don’t appear on your credit report and can’t impact your credit score.
For example, you can check your credit without triggering a hard pull. Similarly, lenders offering pre-qualification for loans and credit cards may perform soft inquiries to see if they will approve you.
How do I freeze my credit report?
Freezing your credit report ensures that identity thieves cannot open new credit in your name, and it’s relatively easy to do. To freeze your credit report, visit all three major credit bureaus online, create accounts, and follow the instructions for credit freezes.