What is a Credit Report?

Your credit report contains important information about you.  It generally includes facts about your identity, where you work, live, your bill-paying habits, and public record information.  Credit grantors use credit reports to determine whether or not you will be extended credit. Identity information includes your name, address, marital status, Social Security number, date of birth, number of dependents, and previous addresses.  Employment data includes your present position, length of employment, income, and previous jobs. 

Factual information about your credit history consists of your credit experiences with specific credit granters.  Public record information includes civil suits and judgments, bankruptcy records or other legal proceedings recorded by a court.  A credit report does not contain information on arrest records, specific purchases, or medical records.

Companies called credit reporting agencies or credit bureaus compile and sell your credit report to businesses, which use it to evaluate your applications for credit, insurance, employment, and other purposes allowed by federal law.  Therefore, it is important that your credit report contain complete and accurate information.

Most of the information in your consumer credit report comes directly from your current creditors.  Credit bureaus compile the data and then provides it to lenders when you ask for a new credit card or loan.  The credit report's purpose is to help a lender decide whether to grant you credit.

It is advisable that you review your credit report every three or four years to check for inaccuracies or omissions.  You also may want to check your report sooner if you are considering a major purchase, such as buying a home.

• Current and former address
     

• Marital status
     

• Age
     

• Social Security number
     

• Employment history
     

• Information from public records, such as judgments or bankruptcy
     

• Credit accounts, including the date each was opened, the amount and balance, the status of the account, your pattern of payment, and the date of the last activity on the account.
     

• The number of inquiries about your credit record, as well as the date and the name of the company making the inquiry,

• Any information about your race;  

• religious preference;

• medical history; 

• personal lifestyle; 

• personal background; 

• political preference; or 

• criminal record.

Consumer credit bureaus serve as control storehouses — or libraries — of credit repayment information.  They collect the credit information from credit grantors such as banks, savings and loans, credit unions, finance companies, and retailers.

Credit grantors then access this combined information from the bureaus to help them make lending decisions.  Today there are three major nationwide credit bureaus.  In addition, many smaller, independently owned credit bureaus serve local markets.  Most of these smaller bureaus have contractual agreements with the three major bureaus.  They even store data on the major bureaus' computer systems.  

There are some things credit bureaus do not do, however.  Here are a few:

• A credit bureau does not decide whether you should be given a loan.  It collects, stores, and reports the relevant identifying and credit information of credit-active Americans.  Using this information, credit grantors alone decide what standards you must meet to be granted credit.
     

• A credit bureau does not know the specific reasons why you are given or denied credit.  The credit bureau does not track the decision a credit grantor makes after ordering a credit report favorable or not.
     

• A credit bureau does not collect information unrelated to your credit repayment performance.
     

• A credit bureau does not allow everyone to see your credit report.  Federal law restricts who may see a copy of your credit report.

See Who Can Order my Credit Report? below.

Living in a society driven by credit, we often overlook what we'd do without it.  If there were no automated credit information services, for example, we'd find it much harder and time consuming to apply for credit.

• Retailers and banks would have to call each creditor listed on an application form to verify whether we were good credit risks.
     

• Costs for credit would be much higher to pay for this labor.
     

• Credit would not be as readily available to middle-and lower-income consumers.
     

• Instant credit would be an impossibility.

Because of an automated credit reporting system, you have unlimited options in your financial life.  For example, you can:

• negotiate a deal for anew car and drive it off the lot within a few hours;
    

• purchase a home in one area of the country based on the good credit record you established while living in another part of the country;
    

• shop for and be offered financial services from institutions in other regions of the country;
    

• use a credit card to rent a video or travel to a favorite vacation destination;
    

• pay for emergency medical treatment; and
    

• catch an airplane at the last minute.

All these opportunities are possible because an automated credit reporting system works quietly in the background on your behalf.

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American Financial Lending - 7740 North 16th Street #210 - Phoenix, AZ 85020
Office Phone: (602) 277-3800 Fax: (602) 277-5534 Fax #2: (602) 279-2220
E-Mail: dean@teamdean.com

 

We lend in the following states: AZ

 

 

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