Can you understand your credit report?
Learn what it means and how to put it right
When you first receive your credit report you will see it contains a lot of information about your personal and financial circumstances. I’ll show you how to read a credit report. I'll break the credit report down in to the different sections and explain what they all mean and what to do if you think the information recorded on your credit report is incorrect.
The first
thing you need is your credit report. Some people say
"I don't have a credit report" believe me unless you have
never ever had any form of credit you will have a credit
report. The other question often asked is which credit
reports providers do lenders use. Whats my credit score? The best thing to is get you free credit report from the 3 main agencies and credit check them all.
If you don't feel you can study this article in full I have found a very good guide to repair credit report scores....here is the link below. The OFFICIAL SITE Of The...CREDIT
SECRETS BIBLE™
If you want to read on once you have your report in front of you this is how to read a credit report.
Section 1: Application Details
Name: Mr John David Anybody Date of birth: 16/06/1966 Other names you have been known by: Mr John David Anybody-Else People you are financially connected to: Mrs Ann E Anybody Date of birth: 21/08/1967
Address details:
Present: 33 HIGH STREET, ANYTOWN, SOMEWHERE A12 3CX
Other: 4 THE FLATS, MIDTOWN, UPSTATE, 1234
Address information
E1: This lets the lender confirm your present and previous address quickly. The address details will also show the dates you lived at the address shown. If the lender can’t easily confirm your current address it may be a possible reason for being turned down for credit. Some times they ask for extra proof of an address i.e. utility bill with your name and the present address on it dated within the last 3 months.
E2: Shows other addresses you have previously been registered at.
Aliases
S1: If you have used other names with lenders these will be recorded here. There will be a record of where the information came from and on what date it was recorded. If you disagree with what is shown you can contact the agency concerned.
Financial Associations
L1: This shows everyone you have a financial not personal link with (the associate). This will be any joint credit applications, joint accounts or joint judgements. The most common connection is joint names on a mortgage but you may find you are link with someone you never expected to be. The associates name and date of birth is recorded as well as the name of the company creating the link and the date the link was created. Your financial associate’s credit details will not be recorded with yours, if they want to see their credit details they will need to apply separately. If you are no longer associated with the name person you will need to contact the agency and explain the situation. They may require you to provide proof of the break in the link. If the information is wrong the easiest way to correct it is to contact the lender who provided the details and ask them to correct it.
Public record information
J1: This will show any court judgements, bankruptcies or individual voluntary arrangements you have made. If you pay the amount of the judgement within 1 month and have a letter of satisfaction, the agency will remove the record. If you pay off the judgement after 1 month it will stay on your record for 6 years but show as having been settled. So if you can, clear any judgements within 1 month to avoid having on your credit report for everyone to see for the next 6 years.
Any bankruptcies are shown in the same way for 6 years. If your bankruptcy ends you need to provide the agency with a copy of the discharge certificate so they can update your records. Do not rely on someone else informing them. If you have a bankruptcy restriction order your credit report will show this as long as the order lasts which can be up to 15 years.
An Individual Voluntary Arrangement (IVA) is a formal arrangement made to pay off your debts by a agreed amount over a shorter period. If the IVA has finished you need to provide the documents to the agency to confirm it so your credit record can be updated.
You can find you have a judgement on your credit report you knew nothing about. The best way to find out who has registered this judgement against you is to contact the court which issued the judgement using the case number which will also be shown on the report. Any court addresses will be shown at the end of your credit report under useful addresses.
Credit account information
C1: This is the section which shows details of your credit arrangements with lenders. When you apply to a new lender they can see how you have repaid any previous loans by looking at the information recorded here. The information is updated monthly and is recorded using a series of different status codes for the previous 12 months.
Details the company providing the credit, the type of credit given along with the date the arrangement started are all shown. A current balance and the credit limit available appear above the status history. The status history will be shown as a series of numbers and/or letters. It should be read from left to right with the number furthest to the left showing the latest payment.
The following guide shows what each code means:
0 = Payments are up to date 1 = Payments are up to 1 month late 2 = Payments are up to 2 months late 3 = Payments are up to 3 months late 4 = Payments are up to 4 months late 5 = Payments are up to 5 months late 6 = Payments are 6 months or more late 8 = the account is in default. The credit arrangement has failed and you have not managed to bring your payments up to date to the satisfaction of the lender so the credit arrangement has ended. D = the account has never been used and nothing is owed. ? = No information has been provided for this month. U = the lender has not been able to give a status code for the month shown. It could be you have only just started the arrangement or payment was not due to start straight away. It could also be that you are in dispute with the lender or the account is not being used.
Below are descriptions used within the credit account information section of the credit report.
An Active Account is a credit account that is still being used. The credit agency will keep a record of all active accounts until they are finished, and then for a further 6 years.
A Settled Account shows accounts which you have made all the required payments and has closed. Details of the account are kept for 6 years from the date the account was settled. Any status codes by a settled account show the period before the account was settled.
An in Default
Account is where you have not maintained the
payments in agreement with the terms laid down by the lender
when you took out the credit arrangement.
A Delinquent Account is shown when you are either:
3 months behind with payments for more than 2 months in a row within the past year; or more than 3 payments behind within the last 12 months.
Other Information that may be shown in the credit account details section is;
Account Query – You have queried the information within the credit report.
Arrangement – The lender has agreed to you varying your payments, usually for a fixed period.
Credit Protection Insurance Claim – a claim has been made on your credit protection insurance.
Deceased – The credit agency has been informed the account holder has died.
Debt Assigned – The lender has sold the debt to another company who does not provide credit information. The account is shown as closed with the original lenders name.
Debt Management Programme – shows the account as being included in a debt-management programme.
Debt Sold to CAIS member – the debt has been sold to a lender that provides credit information. The old account will show closed and details of the new lender will be shown as an active account.
Gone Away – You are not at the address you originally gave when you took out the agreement and have not supplied a new address.
Partial Settlement – lender showing:
Joint Account – there is or has been a joint account holder registered.
Recourse – The lender has transferred the account back to the company who introduced you to the credit agreement.
Voluntary termination – Shows the account has been closed under section 99 of the consumer credit act 1974.
The next step is to
repair credit report scores, this can seem a big task
but I have found a good guide that gives credit repair
advice. It takes you though the steps you need to take
to repair credit report scores.
The OFFICIAL SITE Of The...CREDIT
SECRETS BIBLE™ Current Account Information
The current account information
and codes used in the credit report are different to those
used for the credit accounts.
Status Codes use in the credit report for Current Accounts:
0
-
Account is in credit 1
-
You are above the agreed overdraft limit for 1-2
months.
2 -
You are above the agreed overdraft limit for 2-3 months.
3 -
You are above the agreed overdraft limit for 3 months or
more.
4 -6 Repayments are more than 3 months behind but new arrangements have been made with the lender.
8 - The balance on your account has exceeded your overdraft limit for more than 3 months and you have made no arrangements with the lender to get it in order. The lender has shown the account as in ‘default’ because you have broken the terms of the agreement. The account has been closed by the lender.
U - The account is new and just been opened. Your account has a zero balance and has not been used for the last month and is more than 3 months old.
Repossessions
If unfortunately your property is repossessed it will show on the credit report. The date the property was repossessed, the address of the repossessed property and the lender will also be shown on the report. Details of the repossession will stay on the report for 6 years from the date of the repossession. When you have repaid the lender the entire outstanding amount it will be recorded on your credit report.
Previous Searches
If an organisation has searched your credit report (only with your permission) it will be recorded on your credit report for 12 months. These searches leave what are known as ‘footprints’ and can if you have too many, lead to problems getting credit. If you are shopping around for a good credit or mortgage rate, you are better getting quotes rather than letting numerous lenders do credit searches. For more free information on how to correct a bad credit score see our article; Credit Repair
Sorting out problems with the credit report
Once you have learned how to read a credit report you will quickly see the areas that you may have problems in. Below are some of the questions most commonly asked about a credit report.
Wrong Status Codes - If for any reason you do not agree with the status codes shown on your credit report you should first get in touch with the lender whose address will be listed at the back of the report. If you are still having problems you can contact the credit agency who may contact the lender on your behalf. They will show as quotation searches and are known not to be applications for credit.
I don’t know the organisation shown in credit report? – some companies used large finance organisations and so the lender shown may not be the name of the shop or company you bought the product from. Check the address at the back of the report and contact the named organisation and ask them to show which company this credit agreement relates to.
Not all the companies I have credit with are shown in the credit report? – this is because not all lenders report information to the credit agencies or some only report if you fall behind with payments.
There is a credit search shown I didn’t know anything about? – you need to contact the lender and ask them to show which company carried out the search. It may be that a company you approached uses a larger finance company whose name you don’t recognise. If the search was done without your knowledge the company can ask the credit agency to remove it from your credit report.
There are other addresses shown on my credit report, why? – If you have shown previous addresses which you have lived at or are linked with on a recent application to a lender it may be shown on the report.
When is a link to an address created? – a linked address can be created if you inform the lender you have moved and changed address or the lender receives a credit application relating to another address.
What can I do to explain what caused my credit problem? – You can contact the credit agency and add a ‘notice of correction’ which is an explanation written by you which can be attached to your report and will be seen by anyone looking at the report.
This guide has been written using information available at the time of writing. The author cannot be held responsible for any inaccuracies within this guide and it is the responsibility of the individual to check the current explanation for anything contained within the credit report or the actions required in correcting information held on the report at the time of checking. This article relates to broad guidelines on credit reporting within the UK and the reporting criteria in other countries may vary from these guidelines.
|
|
©2006 Free Credit Report - www.creditreportadviser.com - Repair Credit Report Scores,Fix Credit,Free Credit Score
