by: Debbie Dragon

Your credit history and your credit score, good or bad will follow you for your entire life. Your credit report will be used to help lenders determine whether or not they will lend you money and what the interest rate and terms of your credit will be. Credit reports today are also being used by a variety of service providers and even employers. Many people do not realize that so many aspects of their life can be affected by their credit history and their credit report. It is important for all consumers to know and understand the basics of how their credit is established and when and how their credit report can be used.

To start with, you should know that your credit report actually contains a great deal of your personal information. This information includes your name, address and previous addresses, phone number, social security number, date of birth, employment information and your spouse’s name. Information on your current and past accounts including credit cards, lines of credit, mortgages, personal loans, etc will be in your report. Also on your report will be data that is available in public records including any bankruptcy records you may have, any tax liens in your name, any monetary judgments against you and finally and records of overdue child support payments.

Lenders are the people who most often will pull your credit report. They will take a close look at your credit report, your credit score and your credit history before they will loan you money. They look for a good score, but also at your history to determine your ability to pay back the money they will be loaning you. They want to know whether or not you have a history of paying your bills on time. They will also look to see if you owe any money to current creditors and how much. Every creditor that you have an account with reports to the different credit bureaus on a regular basis what you owe and whether or not your account is in good standings.

In many cases, not just lenders but also service providers and even your employers will use your credit report. They can check to see what your score is and what your credit history reveals. For example many insurance companies pull your credit report and based on your score set your insurance premiums. They use your score to help assess your risk and your premium will likely be higher if you have bad credit. Other service providers also use your credit report, like cell phone companies, to determine whether or not they will give you a contract or to determine what types of contracts they will offer you. Even employers today are using credit histories to help them determine which potential employees to hire.

All consumers, based on this information, should be concerned about their credit history and credit score. Every year you are entitled to a free copy of your credit report and you should take advantage. It is important to periodically get a copy of your credit report and make sure there it is free from any errors. Many times reports do contain mistakes that can easily be corrected by contacting the reporting agencies and asking them to verify the reported information. If they can’t verify it, then ask them to remove it. In addition to your credit report, if you would also like to know what your credit score is, you do have the right to obtain that information as well. You will however, have to pay a small fee to get your credit score.

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