Credit Report

Credit report is the first a lender would ask. If you are applying for a loan. Without the submission of Credit Report, sanctioning of a loan is impossible. The document is not only a record of the applicant’s credit score. But also other information related to it. The contents are as follows:

• List of bank accounts with a credit card
• List of loans granted
• Balances
• Regularity of payments made
• Actions taken against unpaid bills

Credit Report is A Summary Of Financial Activities

Other cases in which such a report is to be provided. When employers ask for it at the time of appointment, promotion and retention. Also when buying an insurance policy.

A major component of a credit report is the credit rating. The rating highlights the borrowing, charging and the activities of repayment. Such a rating is observed on a scale of good and bad. A good rating qualifies one to get the loan. While a bad credit rating are considered ineligible to qualify for a loan.

The entire report contains information categorized into four parts. These are:

Identifying Information: As the name suggests. This type includes an individual’s full name, residential address, periods of employment and unemployment, date of birth etc.

Credit Information: All the financial details are put under this sub head. Credit information complies of bank accounts, lenders and mortgages. Also payment patterns, followed by the individual in the past two years.

Public Record Information: This part refers to all the information about one’s loan and its relation to the state, if any. Bankruptcy, tax liens and unpaid mortgages are details covered under public record information.

Recent Inquiries: The Credit Report also mentions the names of organizations or individuals to whom copies of the report are submitted. Submissions from only the past two years are taken into account.

Credit Report Can Have Wrong Info Too

At this point, it is understood that a credit report with some negative information can stop the entire processing of a loan application. In order to avoid this, one should thoroughly check the Credit Report when it is obtained. When the first copy of the report is obtained, it is for free. However, for every subsequent copy, payment has to be done.

While checking the Credit Report. If a person finds any information that is inaccurate. A letter stating the details of the error made, shall be sent to the respective credit bureau. If one holds any documents that serve as a proof. The document should be enclosed with the letter. The act of submitting the letter in financial terms is known as the filing of a dispute. The Errors is more than just mistaken identity and miss-spelled name. But also incorrect street or block address and obsolete information. This practice is also known as cleaning up the credit report.

Credit Report for Buying House

Once the error has been corrected. The credit score on the report is sure to get a boost. But, clearing of such reports can be time consuming. Their benefit in the long run is big. Apart from getting a loan, a Credit Report is also needed when buying a new house.

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