15 Mar

Credit Reports: What You Need to Know

If you want to know something about credit reports but don’t know where to look for information, then you’ve come to the right place. This article serves as your one-stop shop of information about this subject. It contains the basics that anyone concerned with their credit history needs to know.

Credit Reports are Free

You can get your credit report from credit reporting agencies for free. If you’re living in the United States and Canada, you can do this once a year from the agencies. So if you’ve paid for this kind of information, chances are that you’ve been scammed. This may not apply to other countries, though, so it would be better to check with your local trade office for details.

Your Credit Report Affects Your Credit Score

Aside from yourself, there are other entities that might have a copy of your credit report. Lending institutions for example, would request it to check your credit history. Your history would give them information about your credit that would help them determine if they would be willing to lend you money, and the terms they would impose on it. If you pay your debts promptly, you will have a higher credit score. The higher your score, the more willing creditors would be to lend you money.

You Can Use Your Report to Your Advantage

You can use your credit report for a number of things. First, it can help give you an idea where you most probably stand credit wise. Have you paid other loans and/or credit cards on time or do you often default?

Aside from that, you can check if your information there is accurate and up-to-date. An error may cost you a higher interest rate when you apply for a loan, so it’s best to have it fixed ahead of time.

Finally, you can also use your report to check for any possibility of identity theft. Are there any bank or credit card accounts in your name that doesn’t belong to you? Your report will show that.

In sum, checking your credit report makes a lot of financial sense. So before making any loans or opening up credit card accounts, make sure that you get a copy of your credit report first. What you know may save you from a lot of trouble later on.

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