Credit report – is a credit dossier on the person or company. Credit report can be looked through in a special report, which the credit bureaus draw up and bring up to date.
It is possible to obtain the following data from the credit report:
- The number and size of current and repaid loans;
- History of repayment of loans (timeliness of payments, lateness, failures to pay);
- The size of current arrears;
- The total length of credit report;
- The record of the bankruptcy;
- The list of companies that made the request of your name.
Why is the credit report necessary?
For banks the state of individual’s credit report allows to access a measure of financial risk when lending funds to him. I.e., the credit report creates a measure of trust to the fund receiver. It is easier to lend money to a person known to return money on time than lending to a person with bad credit history.
Thereby, people (and organizations) that have a good credit report can get a bank credit for a lower rate than people who have a bad credit standing.
The absence of credit report:
- It complicates the process of obtaining the credit cards and other types of loans;
- When obtaining the loan, its terms will be more expensive than for a individual who has a good credit report;
- When purchasing or leasing a real property, the owner can change his mind about the amount of deposit in the big side.
Who is collecting information for the credit report?
It is collected by credit bureaus. They also make credit reports and update the information in them. You have to know that banks and other lending organizations send reports periodically (as a rule, once a month) to credit bureaus with information about alterations in the accounts of their customers.
In order to eliminate the mess, in the U.S. there is a system of complete identification of persons, by assigning an individual Social Security number to every person. It is hard to identify the credit report with a definite person without such a number, since everyone of us can have namesakes.
In accordance with U.S. federal law, every person residing in the U.S. and having a Social Security Number is entitled to get free credit report from three credit agencies once a year.
Many people managed to take a loan for a house or a car, or anything else in those good times. And now they have to pay a definite amount of money each month. To be sure that everything is ok with your loan, use credit report monitoring. Of course, in most cases the things go well but don’t ignore credit monitoring – this is your financial safety.