Reading a Credit Report

In order to understand the answer to what is a credit score, you will first need to understand what a credit report is and how to read one. Follow these tips to learn how to interpret your credit report.

General Information

You will be better equipped to answer the question what is a credit score if you obtain your credit report from not just one, but all three credit bureaus. The information contained on each should be generally the same, but small variations can indicate errors that you need to address. The three credit reporting agencies in the United States are Experian, Equifax, and TransUnion. In accordance with the Fair Credit Reporting Act (FCRA), each of these agencies must provide consumers with one free credit report per year upon request. You can obtain a complimentary credit report on our site, on the bureaus' individual sites, or on the free annual credit report site. The report you view will not be exactly the same as what lenders see; the free credit reports are designed for consumers and will have additional information.

Structure of the Report

Your credit report will contain four main sections: identifying information, credit history, public records, and inquiries. Each one of these sections is important in order to understand what is a credit score. The first thing you will see on the report is identifying information, which is exactly what is sounds like. This section will contain your name, current and prior addresses, employer, birthdate, social security number, contact information, etc. Next, you will find your credit history, or a record of all of your financial accounts, past and present. Each account heading should include the creditor's name and your account number, which is sometimes hidden for security reasons. Within each entry, you will find the following information:

• When the account was opened
• The type of credit (credit card, department store card, installment loan, etc.)
• The names of the account holders
• The amount of the loan or credit limit of the account
• Outstanding balance
• Monthly payment obligation
• Account status
• Payment history

The next section of the report is for public records, which is the only part of your report you want blank. Any information in this section indicates some sort of problem. For example, if you've declared bankruptcy or had a judgment or tax lien issued against you, the public records portion of your report will provide the details of the matter. Lastly, you will find inquiries at the bottom of your report. Any time someone accesses your report, the bureau will post an inquiry to your report. Even if you ask the credit bureau itself for a copy of your report, the request will still be listed as an inquiry. You will find two types of inquiries on your report: hard and soft. Hard inquiries are those you initiate by applying for a loan or other type of credit, and soft inquiries are made by your current lenders to monitor your accounts or by creditors who want to send you promotional offers.