Reading Your Credit Report

Note: If you've never read a credit report before--especially if you are disputing a derogatory one--it's a good idea to have a credit counselor or someone knowledgable review it with you.

Although credit bureau reports may not look alike, they contain many of the same items. Usually included are your credit record and relevant facts such as your age, address, marital status, and employment history. When reviewing, check the details! Be sure your your name is spelled right, and the record shows the right Social Security number and birthdate. Any phone numbers, addresses and employer information should be up-to-date.

Your report will show who has requested information about you at your request (such as when you apply for a credit card). It should also tell you who was given information by the bureau in order to send you offers of credit or insurance. (For information on how not to receive these solicitations, see Protecting It).

A list of your creditors (retail stores, mortgage companies, etc.) is provided. You can check for obvious problems, but be aware that lenders also look for certain behaviors. For example, even if you have no outstanding balances, holding or applying for several credit cards may hurt your cause. Or your debt ratio, the percentage of your monthly income that goes towards credit payments, may be higher than acceptable. (Debt ratio typically should not exceed 20-25 percent of your income if you pay a mortgage or 8-15 percent if you don't.)

You can also be denied credit if you have not established enough history to be evaluated.