Consumer credit reports are an essential part of the U.S. credit system. They can make or break your ability to qualify for loans and credit. They also provide all the information that’s used to calculate your credit score. That makes maintaining a clean and error-free credit report crucial if you use credit. Unfortunately, mistakes do happen, so it’s important to review your reports regularly and dispute errors when they occur. This guide will teach you how!
What is a credit report?
A consumer credit report is basically exactly what it sounds like. It’s a report that contains facts about your debt payment history. Lenders use this information to determine if you qualify for loans and credit cards, and what interest rate you pay.
By regularly reviewing your credit report, you can:
- Identify reporting errors, so you can dispute the information with bureaus to repair your credit
- Spot potential signs of identity theft, such as new accounts that you don’t recognize and credit inquiries you did not authorize
- Understand negative items that could be contributing to a lower credit score, so you can take strategic action to build credit