3 Areas to Inspect On Your Credit Report

A credit report is a widow to your credit history and a comprehensive look at your financial state. Federal law states that you are allowed to receive a free credit report every year from each of the three major credit bureaus, Equifax, Experian and TransUnion. You can request these reports all at once or you can space them out throughout the year. Experts recommend getting one every four months in order to stay on top of your credit. Once you get your report, you may be asking yourself what the next step is. It is a great idea to look over the entire document, but is important to verify the information in these specific areas.

General info
Every credit report has a section with general information. These vital statistics include your name, address, Social Security number and your birth date. Though you may be tempted to pass this section over, it's a good idea to Look over this area for any misspelling or incorrect information. If a number or letter is out of place you should alert the credit bureau right away. Having any incorrect info may hurt your chances to apply for a loan because your information needs to be the same on each report.

Late payments
Your payment history contributes 35 percent of your credit score. Any sort of late payment, whether it is 30 or 90 days past due will knock your score down a few points. Examine the payment history section and see if you have made any. If this is the case, check out the timeline of your bad payments and figure how long ago a late payment occurred. In order to avoid this in the future, set up a reminder on the calendar to let you know when your bills are due.

Along with making a payment reminder, it will be helpful to check your credit report against your own records. Comparing these two documents can aid you in discovering any discrepancies.

Hard inquiries
You are entitled to a free credit report from each of the major credit bureaus, but running more reports may hurt your credit score. A hard inquiry is when a lender checks out your credit during the approval process of getting a loan or a new line of credit. Hard inquiries make up a very small portion of your credit score, but it is good to pay attention to this section in order to find out if you are overextending yourself.

Understanding the different sections of your credit report can help you improve the state of your credit and learn from past mistakes