Other information comes from public records. Creditors regularly provide information to credit bureaus about the debt repayment practices of consumers to whom they have lent money. The reports that credit bureaus compile include information supplied by both consumers (e.g., information contained in a credit application) and the creditors with whom they do business. The three major credit bureaus are Equifax ( Experian ( and TransUnion ( Essentially, they are clearinghouses of consumer credit information. This would be slow, costly, and inconvenient. Without credit reports and credit bureaus, individual creditors and businesses would need to gather necessary information about potential borrowers themselves. Persons or businesses can request copies of your credit report when they plan to use your credit information to 1) extend you credit, 2) consider offering employment, 3) underwrite insurance, 4) rent you a place to live, 5) determine eligibility for certain types of licenses, 6) evaluate other legitimate business needs, 7) determine child support payments, and 8) provide information about the current residence of individuals. They are used to make business decisions about you by those who have a legitimate need for the information. Your Credit ReportĬredit reports are prepared by credit reporting companies (credit bureaus). If you establish a credit history early and pay all of your bills on time, you will have laid the foundation that will greatly improve your chances of being approved for a loan in the future. You may even pay higher premiums for insurance or be denied an apartment rental or employment if you have a negative credit history. The interest rate you are charged on a loan can vary depending on your credit report. They may take longer to decide to approve a loan, charge you higher interest rates, or turn down your loan application altogether. Lenders have fewer clues in deciding whether to give you a loan. If you have always paid cash for purchases and haven’t borrowed money before, you have no history or proof to indicate the type of credit risk you would be. Or you might be turned down for a variety of other reasons such as not employed long enough or new to an area. You may not get a loan because of negative information reported in your credit file. Often, people do not know what their credit report says until they are turned down for credit. This means that individuals will not only pay higher interest rates, but it takes a better credit history to qualify for loans. Rising interest rates generally lead to less money for individuals and businesses to borrow. Availability of money is determined by general conditions in the economy. Your ability to borrow money or use credit depends on several factors including the availability of money, your previous experience borrowing money, and your history of repaying credit obligations. If, on the other hand, you are usually late, have not completed some of your loan payments, and have more credit than you can repay, your credit picture is negative. If your credit report indicates that you are generally on time with your credit payments, the impression is positive. A credit report is a picture of you in words and numbers and gives others an impression of your behavior. Other pictures show people in less than perfect circumstances. Sometimes a picture shows a person who looks good and is in control of the situation. What Does Your Credit Report Say About You?Ĭredit reports are like photographs, they capture a fixed image at a certain point in time.
Request a free credit report at or by calling 1-87.Additional free copies are available in certain situations. Coloradans have a right to receive two free copies of credit reports from each credit reporting company each year.Credit reporting companies collect information from companies who have granted credit to you and from public records in state and county offices and courts.The interest rate you are charged on a loan can vary depending on your credit report.Credit reports are provided by three major credit bureaus: Equifax ( Experian ( com), and TransUnion (.