Types of Credit Reports

By Barb Nefer

  • Overview

    Types of Credit Reports
    Your credit report is the key to being able to get a loan, a new credit card, or a mortgage loan. Potential lenders will request your credit report in order to make a determination about your loan application. Because so much hinges on your credit report, you should know the different types of reports, the information they contain, and how you can get copies of your credit history.
  • Function

    A credit report is a document containing a consumer's history of opening, closing, and paying credit accounts. These may include credit cards like Visa, Mastercard, and American express, store charge cards, mortgages, car loans, personal loans, home equity lines of credit, and other types of revolving credit accounts. The credit report provides a convenient way to consolidate financial information for a potential lender.
  • Use

    The most common use of a credit report is to help a potential lender decide whether or not to allow a consumer to open a credit account. The lender will look at the amount of existing credit, past payment history, and any charge-offs, bankruptcies, or other issues to make a determination. Credit reports may also be used by employers to help screen potential employees, particularly those who might be responsible for handling money. Many insurance companies also consider credit reports as one of the criteria for issuing a policy.

  • Types

    There are two main types of consumer credit reports: single bureau reports and three bureau reports. The main difference is that a single bureau report contains data from one of the three major credit bureaus (TransUnion, Experian, and Equifax). A three bureau report has a combined history based on information from all three bureaus. A single bureau report can be obtained directly from that bureau or through a credit report service company. A three bureau report is typically purchased from such a company. The reports described above are consumer credit reports. There are also business credit reports, which are similar but which report the credit history of a commercial entity rather than an individual.
  • Features

    The main information in any type of credit report is the credit history. This includes a list of accounts and payment histories for charge cards and loans. Reports also contain public records of issues that can affect creditworthiness, such as court judgments, bankruptcies, and tax liens. They will also include a person's name, alias, date of birth, current address, phone number, previous address, current employer, previous employer, and Social Security Number. Inquiries by other credit grantors and companies who have previously viewed the report will also be listed.
  • Benefits

    The Fair Accurate Credit Transaction (FACT) act required that all consumers in the United States are entitled to one free copy of their credit report from each of the three main bureaus yearly. These reports can be accessed via an official website which you can find in the Resources section.
  • Warning

    Even though consumers are entitled to a free annual copy of their credit report from each of the credit bureaus, many online companies will offer to provide a free credit report as a way to entice them to purchase services. These services may include credit monitoring to detect fraud and making corrections to any errors on the report. While these services may be useful for some people, they are not a requirement to get the free reports offered under the FACT law.
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