Why Your Credit Report Matters

If you’re thinking about taking out a loan, your credit report is one of the most important tools in your financial toolkit. It gives you — and lenders — a snapshot of your credit health, including payment history, open accounts, and overall debt.

Surprisingly, nearly half of all U.S. adults haven’t checked their credit report or score in the last six months. Don’t let that be you.

What Is a Credit Report?

A credit report is a detailed record of your credit history, compiled by one of the three major credit bureaus: Equifax, Experian, and TransUnion. It includes:

• Credit card and loan balances

• Payment history

• Credit limits

• Length of credit accounts

• Public records like bankruptcies or tax liens

• Credit inquiries

Lenders use your credit report to evaluate your creditworthiness, especially for unsecured loans or if you have bad credit.

How to Get a Free Credit Report

By law, you’re entitled to one free credit report per year from each of the three nationwide credit bureaus. Here's what you’ll need:

Required Information:

• Full name

• Address (current and previous, if applicable)

• Date of birth

• Social Security Number

Ways to Get Your Report:

When Should You Check Your Credit Report?

Before applying for:

• A personal loan

• A mortgage

• A car loan

• An apartment lease

• A new job

Checking your report ensures accuracy and lets you spot fraudulent activity or errors that could damage your score.

What’s Inside a Credit Report?

Each report generally includes these five sections:

1. Personal information. Name, address, date of birth, SSN

2. Credit history. Active and closed accounts, balances, payment status

3. Public records. Bankruptcies, judgments, liens

4. Hard inquiries. Applications for credit in the past 24 months

5. Soft inquiries. Background checks and account reviews that don’t affect your score

Does Checking Your Credit Hurt Your Score?

No — requesting your own credit report is a soft inquiry and does not affect your score.

Only hard inquiries, like when you apply for a loan or new credit card, can slightly impact your score. However, multiple inquiries within a 14–45 day window for the same type of loan (e.g., auto or mortgage) are usually treated as a single inquiry.

How to Protect Yourself from Identity Theft

Here are practical steps you can take to secure your financial identity:

• Use strong, unique passwords (or a password manager)

• Enable two-factor authentication on financial accounts

• Check your credit reports regularly

• Shred sensitive documents before disposal

• Secure your mailbox

• Limit personal info on social media

• Use only secure Wi-Fi networks

• Update your software and devices

• Review your bank statements frequently

• Freeze your credit if you're concerned about fraud

What to Do If You Spot Fraud on Your Credit Report

If you find unauthorized accounts or suspicious activity:

1. Contact the bureau immediately:

• Equifax: 1-800-685-1111

• Experian: 1-888-397-3742

• TransUnion: 1-888-909-8872

2. Report the fraud to the FTC at ReportFraud.ftc.gov

3. Dispute the error directly with the credit bureau through its online portal.

Where to Check Your Credit Score

Your credit score isn’t included in your free report, but you can access it through:

• Your credit card issuer or bank

• Online tools like Credit Karma or Credit Sesame

• Directly from credit bureaus (may charge a fee)

• Some loan providers, after an application

Ways to Improve Your Credit Score

Improving your score takes time, but you can start with:

• On-time payments

• Reducing debt

• Using less than 30% of your credit limit

• Avoiding unnecessary hard inquiries

• Using credit responsibly over time

• Monitoring your reports for errors

Consider talking to a non-profit credit counselor or financial advisor for personalized guidance.

Frequently Asked Questions About Credit Reports

Here are questions people often ask about credit reports.

How often should I check my credit report?

At least once per year from each bureau — more often if you're applying for a loan or suspect fraud.

How do I dispute an error?

Contact the relevant bureau online, by phone, or by mail. Provide evidence and monitor the resolution.

What’s the difference between a credit report and a credit score?

• Credit Report: Detailed history of your credit use.

• Credit Score: A number (typically 300–850) calculated from your credit report data.

Note: The content provided in this article is for informational purposes only. Contact your financial advisor regarding your specific financial situation.