Credit report is the complete guide about your financial life. It contains
all information on your histories, inquiries,
disputes etc. when ever you apply for a loan or a new credit line, your credit
report is reviewed by the lender. Your chances of getting the loan greatly
increase if you have a good history. The interest rate offers on the loans
will considerably reduce then for a person with a bad history. It's very
vital to understand what is in the credit report, how it gets there and how it is interpreted.

What is it?

Credit Report is an accumulation of information about your past and current financial status. Your payment histories, available credit, and many other issues are listed in it providing a complete picture of how good you are in paying back the borrowed money. The lenders assess the risk of lending you the money by reviewing credit report.


To produce a credit report, Credit Reporting Agencies (CRAs) or credit bureaus collect this information about you from lenders. They sell it to diferent businesses. Businesses such as banks and creditors extract different information from this credit report to evaluate your score.

How the Information Gets There

To produce a person's credit report there are 1000 local and regional bureaus in USA collecting information about financial habits of people. In most of the cases, these smaller bureaus are affiliated with the one of large national bureaus which is Equifax, Experian or TransUnion.



Credit Report is reviewed when you apply for a creditcard and provide
the required information such as name address, employer, other cards
etc. The company contacts one of the reporting agencies CRAs
or bureaus to review your report. If you fall in their category
of good borrowers and have a healthy score, they will approve your application and provide all this information
to the CRA. CRAs also extract information
about you from the public records such as court records. Your payment history is also provided by that company to the CRA
which becomes the part of your credit report.



From now on, all the transactions you make that involve credit are reported to the CRAs by the card companies, you are doing business with, at the end of the month. The large lender companies report to all three national bureaus. This is the reason that your report, present with the three bureaus is not always the same. Since reporting is done via several credit agencies to the bureaus when you are reviewing your financial status you must take out all three reports to get the complete picture. There can be an account that appears on only one bureau's credit report and not on the others.