Your Credit Report: How to Read It

Looking at your credit report will usually be a part of credit counseling and getting back on the right track financially. A credit report reflects your consumer credit history. It used to just be used to determine creditworthiness, but now it is also being used by insurance companies to determine premiums, and even prospective employers to determine if you are the right candidate for the job.

Since credit reports are now so important, you should get a copy of your credit report and take the time to learn how to read it. And if you find any discrepancies, you should challenge them right away.

Getting a Copy of Your Credit Report

You actually have three credit reports, one from each of the three nationwide credit reporting agencies in the US. They are Experian, TransUnion and Equifax. Order them online from, which is the only authorized website for free credit reports. Provide your name, address, social security number, and date of birth to verify your identity.

How Is the Report Compiled?

Credit reporting bureaus are sent information by creditors about how their customers pay their bills. The bureau assembles this information, along with public record information, into a file for each consumer. There are thousands of bureaus reporting this information to the big three agencies, which hold data for more than 170 million Americans.

How Is Credit worthiness Determined?

If you apply for a loan or a new credit card, the new creditor will request your report. Based on their criteria, they will determine whether or not they wish to accept you as a customer.

In some cases, the decision has little to do with the credit report itself, but instead is based on things like income, length of residence at a location, or employment and length of time working there.