With the hustle and bustle of everyday life, consumers normally don’t think about what is reported on their credit reports. Whether they feel they already know the contents of their credit report, or just tuck this little “chore” into the back of their mind for later, or if they are even scared to check, the average consumer does not know his or her credit score and what information is included on his or her credit history.

In layman’s terms, a credit report is all of your financial information laid out in a very organized manner on a few sheets of paper. Items listed on your credit report include your credit borrowing history, such as mortgage loans, car loans, credit cards, etc., and your timeliness in paying your bills. Credit applications you have submitted for approval are also included on your credit report, as well as the acceptance or denial of the application.

A company will request a copy of your credit report if you apply for credit. Once the company has your credit report in hand, it will review your credit rating to determine if it feels you are a good credit risk or a bad credit risk. If it feels you are a good credit risk, you will most likely be approved for the credit. If it feels that you are a bad credit risk, you will probably be denied.

For this reason, it is vitally important that consumers know and understand what is detailed on their credit history. Just guessing at what is on your credit report is not wise. It is important to KNOW! Not KNOWing may cost you that vehicle you just fell in love with!

It is really very easy to obtain a copy of your credit report. You can utilize one of the many internet businesses which offer this service or you can go ahead and contact one of the three major credit reporting agencies – TransUnion, Equifax, or Experian – for a copy. These credit reporting agencies are legally required to provide one copy of your credit report, every twelve months, upon your request.

After your credit reports have arrived, sit down and review them. The objective of reviewing these reports is to make sure that your financial history is reflected correctly. Make sure that all the information listed is accurate, including old and current addresses, payment information, employment information, etc. You will also want to make sure that any accounts which were initially overdue or sent to a collection agency, but later cleared up, are noted as such.

If your credit report contains any inaccurate or false entries, these can be corrected. A letter, along with any confirming documentation, should be sent to the credit reporting agency. Your letter should explain the purpose of the letter and what you are requesting. The confirming documentation should be enough to correct the entry.

Many consumers do not understand the importance of a clean credit history. Often, they forget about that $30 bill that was in dispute and was then, unbeknownst to them, added to their credit report, or are unaware that they have been reported for being over their limit on a credit card because, in fact, the card was paid down the very next day. This is the very reason it is important to obtain a copy of your credit history and take some time to review the reports once they arrive. Just requesting the report, and then doing nothing with it, is useless.

Not KNOWING the contents of your credit history can cause financial chaos at the very worst time for you – maybe while you are trying to purchase a home. If false and inaccurate information is allowed to remain on your credit report, you may face years of high APR rates. Don’t let this happen to you. KNOW what is reported on your credit report!

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