Credit Reports: What’s in it & What to Look For

By now, we all know that we should be looking at our credit reports to review for inaccuracies and fraudulent activity.  But do you know what the status abbreviations mean, or the difference between a “hard” inquiry and a “soft” inquiry or what type of information indicates fraudulent activity?

Credit reporting agencies rely on credit issuers and other businesses to compile your credit history.  Although CRAs are federally regulated, they are not responsible for verifying the accuracy of information they receive.  Their basic function is to collect and supply credit information to businesses so that they can make decisions about you as a credit risk.

Credit reports are free from all three credit reporting agencies, Experian, TransUnion and Equifax, every 12 months.  You’re also entitled to free reports if you’ve been denied credit or if you think you’ve been a victim of identity theft.

Incorrect Information may appear on your report

Credit Reports have four sections: a header or identifying information, credit history, public records, and a section for inquiries.

Spelling errors or mistakes in processing an application can show up on your report.  It’s not unusual to see more than one social security number or misspelling of your name.  This generally happens when a credit issuer reported the information inaccurately, so variations are common.  You may also see your current address or previous addresses, date of birth, your spouse’s name, telephone numbers even your employer’s name.  This type of information is located in the header of the report, sometimes referred to as the personal identifying information section.

Credit History

Within the credit history section, you’ll find information about accounts you’ve held for seven years.  If you’ve closed any accounts within that period of time, it will be marked as “closed by consumer.”  This is the section to pay close attention to if there are accounts you’re unfamiliar with.  If there are accounts you don’t recognize or if accounts have gone to collection, you will need to contact the credit issuer and the collection agency for possible fraud.  See our website for more information about the steps to reporting identity theft.  Each account that appears in this section has the following data:

  • Name of the company who is reporting the information.
  • Account number with the company.
  • Accountholder -   lists who’s responsible for the account.  The following abbreviations may also be listed beside this information:
    • I – Individual
    • U – Undesignated
    • J – Joint
    • A – Authorized User
    • M – Maker
    • T – Terminated
    • C – Co-maker/Co-signer
    • S – Shared
  • Date the account was opened – Indicated by a month and year.
  • Months reviewed – States the number of months the account history has been reported.
  • Last activity – Lists the date of last activity on the account.
  • Terms of payment – States the number of installments or the monthly payment for installment loans such as a car or mortgage.
  • Balance – The current amount owed on the account at the time it was reported.
  • Overdue notices, any late payments and associated dates.
  • Status – Marked with a combination of letters and numbers to indicate the type of account and the payment activity.  The account may be listed as an Open, Revolving (credit card) or Installment (car loan or mortgage).  Abbreviations for timeliness of payments vary among agencies.  Numbers (0 to 9) are used to mark accounts as current or paid as agreed.  The larger the number the longer the account has been past due.
  • Date reported – states the last time information was updated by the creditor.
  • Collections actions

Public Records

The public records section lists judgments, bankruptcies or tax liens.  If you see information that is inaccurate you need to follow up with the credit reporting agency to adjust any inaccuracies.  For most consumers this section is blank.

Credit Inquiries

The last section of your credit report is credit inquiries and anyone that has asked to see your credit report is listed in this section.  Inquiries listed as “hard” are initiated by the consumer.  These inquiries are placed on the report when you complete an application for credit or when seeking dental or medical treatment.  “Soft” inquiries are initiated by companies that may want to send you marketing information or current creditors monitoring your account.

If there are “hard” inquiries listed that were not initiated by you, or an account you do not recognize you need to contact the creditor immediately.  Log all information when following up with credit issuers and reporting agencies, who you spoke with, dates, etc.  If at all possible send a letter with a return receipt requested to the creditor asking for more information in the event you do have a case of identity theft.   Lastly, see about filing a fraud alert with the three credit bureaus. A proactive stance can keep your identity safe and protect your financial reputation.