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A consumer credit report is a record of your credit payment history. It helps a lender decide whether to grant credit to the borrower. Much of the information in the credit report comes from the businesses that have given you a charge account, car loan, home mortgage or some other form of credit. To obtain a copy of your credit record from the three major credit reporting agencies contact:
- Equifax: (800) 685-1111
- Experian: (888) 397-3742 or www.experian.com
- Trans Union: (800) 916-8800
To make sure your credit record is accurate or to check against someone stealing your financial identity, obtain a copy periodically. When applying for your credit report have the following information available to facilitate the process: full name, including Jr., Sr., III, nicknames or any other variation; complete addresses for a five-year period, including zip codes; Social Security number; spouse's full name, if married; date of birth; signature; current and previous employers; and a copy of your driver's license. When you receive your credit report, read it carefully.
If you have been turned down for credit, employment, insurance or rental housing recently you can receive a free credit report if you request it within 60 days of the denial. Residents of Colorado can receive one free credit report from the three major national credit reporting agencies once each year. Each additional copy of your credit report can be received during the year for approximately $9. There will be a charge for credit reports accessed online.
Disputed information must be verified within 30 days or removed from the credit report. Just because information is corrected on one bureau's report is no guarantee that it has been corrected on all three. Check the other credit reporting agencies and request corrections where needed.
Another piece of information that companies can get about you - your credit score - is now available directly to consumers. Pressure from consumer groups and public officials helped push the bureaus to give people access to their scores.
Credit scores are based on a FICO formula. FICO stands for Fair, Isaac & Co., the company that developed the scoring formula. The scores range from 300 (worst) to 850 and are generated through complex statistical models. The models analyze your credit history based on five categories: payment history, amount you owe, length of credit history, new credit and the type of lenders in your credit mix.
Credit score information is now offered by the three credit bureaus. When obtaining your score from one of the credit bureaus, it is important to understand that your score does not come directly from FICO. It is adapted to each bureau:
Since your score is a result of your credit bureau data, it will change every time your credit report changes.
Your score is widely used to evaluate whether you will be granted credit and at what rate. It also determines auto and homeowner insurance rates, mortgage rates and more. Low credit scores result in higher charges for many financial products. Most of us want the best FICO score we can get. People planning to refinance mortgages can learn to get better interest rates by improving their credit scores.
Although the opportunity for consumers to learn to better their credit scores is not perfect and is still somewhat vague, it is worth it for most of us to understand these scores better. Additional information about credit scoring and other credit issues can be accessed from the Federal Trade Commission at: www.ftc.gov/bcp/conline/pubs/credit/scoring.htm or through Colorado State University Extension at: www.ext.colostate.edu/pubs/consumer/pubcons.html#finance.
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