How Your Credit Report Affects You

by August Malson

I never thought much about my credit before. It wasn't until I was in the process of buying my first home was my credit really called into question. When I first spoke with my mortgage lender was first real wake up call I had. He then proceeded to give me some useful information about credit that I would like to share with you.

There are three major different credit reporting agencies. They are Experian, Equifax, and Trans Union. Each of these agencies contain seperate reports on your credit history. Important to note is that these agencies do not share the information they have between themselves, and your creditor might not send your information to all three.

Your credit report would contain the following information:
* Name
* Current and Previous Address
* Current and Previous Employer
* Date of Birth
* Any other variations of your personal information (other SSN,
Nicknames, etc.)
* Account Information
* Public Information (Bankruptcy, Judgements, Liens, etc.)

Your credit score is created from information from your credit report. The more positive information that you have on your credit report, the higher your score, and the opposite is also true. The higher your credit score is, then the lower interest rate loans that you can recieve for purchasing a home, getting new credit cards,and you get treated like $1,000,000 when you are at the bank. However, if your credit score isn't that high, your interest rates will be higher, or you might even be denied for the loan. Now, I know what you might be thinking, how bad can a high interest rate be? For instance, a 1 or 2 point difference in an interest rate can be a difference of $100 or more per month.

What would cause negative entries on your credit report? A number of things could cause negative entries, like bankruptcy, foreclosure, late payments, liens, judgements, etc. Typically these entries can stay on your credit report for 7 years, but bankruptcy and foreclosure stay on your credit report for 10 years. There rumors where a foreclosure or bankruptcy will not be removed from your credit report. While positive entries on your credit report are entered when you pay your bills on time.

You can request a free copy of your credit report if you have met one of the following:
* If you have been denied credit or benefits within the past 60 days
* If you are on public assistance
* If you are unemployed or have been denied employment
* If you believe you are a victim of fraud

Now you understand the basics to your credit. I suggest that everyone reading this article, request a copy of their credit report and reveiw the information to make sure that the information in the credit report is correct. A few sites to review for credit report information:
* http://www.myfico.com
* http://www.freecreditreport.com

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August Malson is a regular contributor