How do I interpret my credit report?

The best way to ensure that you can read and understand your credit report is to order it either directly from the credit reporting agencies, or through the Annual Credit Report Website.

By doing it this way, you're sure to get a report that's "consumer friendly." If you have a friend that works at a bank and you have him pull your credit report, it will be much harder to understand.

Your credit report will be divided into four basic sections:

1. your personal information
2. credit history
3. public records
4. inquiries

The "personal information" section is self-explanatory: your name, address, employer, social security number, etc. Check this information carefully and make sure it's accurate.

The "credit history" section will list your past and current open credit accounts. Each account will have it's own line. Each line includes the following:

• when the account was opened
• type of credit (i.e. mortgages and car loans are installments; credit cards are revolving)
• name the account is in (if it is a joint account, both names will appear)
• total amount of the loan or credit limit
• balance still due
• monthly payment amount
• status of the account (open, paid, inactive, etc.)
• how well you've paid on the account (on time, 30 days late, etc)

The "public records" section will list any bankruptcies, tax liens, or judgments. In this section of your report the less information the better.

The "inquires" section simply lists the people and companies that have requested a copy of your credit report.