How to Read Your Credit Report and Spot Potential Errors

Your credit report contains a wealth of information about your financial situation. It often has a history of your credit accounts, including credit inquiries and when accounts were opened, as well as personal information such as your full name, date of birth, and address.

But figuring out how to read your credit report and know how the information applies to your personal finances can be difficult.

In this guide, you'll learn how to get a free credit report, how to read your credit report, and what the differences are between the reports from TransUnion, Equifax, and Experian. This will help you understand your credit report's value when learning how to manage your money.

Your credit report vs. your credit score

Your credit report is not the same as your credit score, though they do have one major connection. Both your credit report and credit score are tied to your history of credit use. This could include recent credit inquiries and your number of open or closed accounts.

But your credit score is based on your credit report. It's similar to how an assignment at school might be given a grade that correlates with how well you complete your work. Similarly, your credit report is given a grade (your credit score) to show how responsible you are with credit.

This score is helpful to lenders and credit card issuers when they have to decide which, if any, loan or credit products to offer you or whether you should receive a higher or lower interest rate. Be aware that different scoring models exist to determine your creditworthiness. This means you can have different types of credit scores, including a FICO score and VantageScore, depending on which scoring model was used.

Your credit report includes a detailed history of your credit use. It has your personal information, a list of your accounts (including things like credit cards, student loans, or auto loans), your credit inquiries, and any negative information, like bankruptcies, foreclosures, and accounts that were sent to a collection agency. However, you won't find any mention of your credit score on your credit report.

The best use for your credit report is for you to see whether there are any inaccuracies and to check for potential cases of identity theft. If the payment history or account limits are incorrect, it could have a negative impact on your credit score. If you don't recognize an account, it may have been opened fraudulently in your name. Regularly checking your credit report could help you protect yourself from identity theft and help improve your credit score. 

How to get your credit report

According to the Fair Credit Reporting Act, you're entitled to receive a free copy of your credit report every 12 months from the three major credit bureaus: TransUnion, Equifax, and Experian.

For a more streamlined process, you can visit AnnualCreditReport.com to request your free credit reports. This is the only official website authorized by the federal government to send you free reports, so don't be fooled by other websites, as they could be scams.

AnnualCreditReport.com outlines three steps to get your free credit reports:

1. Fill out a form. Fill out the online request form with your legal name, birthday, current U.S. address, previous U.S. address (if applicable), and Social Security number.
2. Pick the reports you want. Choose which credit reports you want to receive between TransUnion, Equifax, and Experian. This can include one report from each credit bureau, one report from two of the credit bureaus, or one report from one of the credit bureaus. You don't have to fill out multiple forms to request multiple reports.
3. Request and review your reports online. Answer a few more questions before you can receive your requested credit report. These questions are designed to be more difficult than filling out your personal information and may require you to pull up your financial records. This is to ensure that only you can access your reports. You will have to repeat this step for each credit report you requested.

Thanks to a permanently extended program initiated at the beginning of the COVID-19 pandemic, free weekly online credit reports are available from all three major credit bureaus through AnnualCreditReport.com, as well.

How to read a credit report

The three credit reporting agencies arrange their credit reports differently (more on that below), but the basic information is typically the same and you'll find similar sections. However, you won't typically find information about your credit score, rent, utilities, debit card use, salary, employment status, or a spouse's credit history on your credit report.

Here are common sections to look for when viewing your free credit report:

Identifying information

Your identifying information, or personal information, may include your name, date of birth, address, and Social Security number. It may also include different variations of your name, previous addresses, and employer listings.

Check over this section of your credit report to make sure everything is correct and accurate. Keep in mind that different variations of your name may not be cause for alarm. You may have used a short version of your name on a credit application or had a name change after getting married.

But if any information is inaccurate, you may need to dispute the item on your report. Each credit bureau has its own process for how to dispute credit report errors.

Credit history

Your credit history may contain the most data on your credit report. This is where you'll find a list of all your credit accounts and loans, as well as their pertinent information.

This section may include:

• Lender name, address, and phone number
• Account type
• Account balance
• Account terms
• Credit limit or total line of credit
• Status of the account
• Payment history

Look over each account to make sure all the information is correct. A thorough review of your credit history can help you spot errors that may be affecting your score. For example, if your report shows you made late payments on an account when you've always paid your balance on time, it likely makes sense to investigate the issue further.

Inquiries

Credit inquiries occur when anyone, including yourself, checks your credit report. They're separated into two categories: soft inquiries and hard inquiries. A soft inquiry has no effect on your credit score and typically occurs when you request your credit report, you receive a pre-approval offer for a credit card or loan, or a current lender reviews your credit accounts.

Hard inquiries, on the other hand, could have an impact on your credit score. These typically occur when you apply for a credit or loan product. This may include credit card applications, loan applications, or applying for a new cell phone or internet service contract. Hard inquiries remain on your credit report for up to two years but their impact on your credit score fades over time.

Review your inquiries to make sure you're aware of what they are and why they happened. Also, check for hard inquiries to fall off your reports after two years.

Public records

Bankruptcy public records can appear on your credit report. This type of negative item can hamper your financial opportunities and should be reviewed for accuracy. Bankruptcies can remain on your credit report for seven to 10 years, so you'll want to make sure they fall off when they're supposed to.

Collections accounts

Accounts that have been sent to collections will show up on your credit report. Collections are often connected to debt, like installment loans and credit cards, that already appear on credit reports. But other types of collections accounts can be added to your credit report as well. This may include delinquencies in regards to paying money owed to doctors or hospitals, internet service providers, mobile phone providers, banks, and more. If an account is incorrectly marked as collections, start a dispute to have the entry corrected. Otherwise, it could stay on your report for up to seven years.

How to read a TransUnion credit report

If you want to learn how to read a TransUnion credit report, you'll need to first understand how they're set up. TransUnion credit reports are separated into sections like Equifax and Experian credit reports.

The sections of a TransUnion credit report include:

• Personal (identifying) information
• Public records
• Accounts (credit history)
• Collections
• Inquiries

Although much of the information is self-explanatory, you might not be familiar with the payment history ratings that TransUnion uses. For each creditor you owe, there's a calendar marking the recent months of your payment history. In addition to the monthly balance and any past due charges, you'll receive a rating for your payment timeliness. A green "OK" indicates an on-time payment, for instance, but a red "90" means a payment is 90 days past due and a black "COL" means it's been sent to collections.

How to read an Equifax credit report

Equifax credit reports show similar information to TransUnion and Experian credit reports. If you want to learn how to read an Equifax credit report, get familiar with these sections:

• Credit accounts (credit history)
• Personal information
• Inquiries
• Public records
• Collections

Equifax breaks down your credit accounts into revolving accounts, mortgage accounts, installment accounts, and open lines. It also calculates your credit utilization for each of your revolving accounts for you. If you download your Equifax credit report, you can find a glossary alongside each credit account. This will define codes for you, like how "TN" means "too new to rate."

How to read an Experian credit report

If you want to learn how to read an Experian credit report, you'll need to know these sections:

• Personal information
• Accounts
• Public records
• Hard inquiries
• Soft inquiries

The sections are similar to what you'll find on a TransUnion or Equifax credit report. A checkmark on the calendar of recent months indicates a current payment. If yours features an incorrectly reported late payment, reach out to remedy it. Disputing and resolving errors on your credit report could help improve your credit scores. This includes your FICO® Score, which is the scoring model Experian uses.

Using a resource like Experian Boost™ could also help increase your credit scores.¹ <p>Credit score calculated based on FICO® Score 8 model. Your lender or insurer may use a different FICO® Score than FICO® Score 8, or another type of credit score altogether. <a href="https://www.experian.com/help/information.html?conf=ecs_ficoScoreDisclosure" target="_blank">Learn more</a>.<br></p> Experian Boost helps you report positive payment history on bills you're already paying and adds them to your credit file. This could include monthly phone bills, utilities, and streaming subscriptions.

FAQs

Bottom line

Taking all your credit report data in at once might be too much, especially when each credit bureau has its own version of the report. However, it's worth the time invested to have a better grasp on your financial future.

Once you know how to read your credit report, make sure all the data aligns with the accounts you've opened, your loan and credit card payments, and your personal information. If it doesn't, consider filing a dispute. Regularly reviewing your credit report could help you keep an eye on your financial situation and possibly improve your credit score.