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Credit Report

2/7/2025

(Continued)

4. Credit Inquiries

  1. Lists inquiries into your credit when you apply for new credit.
  2. There are two types: hard inquiries (affect your score) and soft inquiries (do not affect your score).

5. Public Records

  1. Information on bankruptcies, tax liens, or civil judgments that may affect your creditworthiness.
  2. Public records can significantly impact your credit score and stay on your report for several years.

6. Collections

  1. Accounts that have been sent to collections due to nonpayment.
  2. This can severely damage your credit score.

Importance of a Credit Report

  1. Credit Score Impact: Your credit report directly influences your credit score, which lenders use to assess your creditworthiness.
  2. Loan Applications: Lenders review credit reports to decide on loan approvals and interest rates.
  3. Renting: Landlords may check your credit report as part of the rental application process.
  4. Employment: Some employers review credit reports as part of the hiring process, especially for positions that involve financial responsibilities.

Checking Your Credit Report

  1. You are entitled to one free credit report per year from each of the three major credit bureaus (Equifax, Experian, and TransUnion) through AnnualCreditReport.com. 
  2. Regularly reviewing your credit report helps you spot errors, identify fraud, and understand your credit standing.

How to Improve Your Credit Report

  1. Pay Bills on Time: Timely payments are crucial for a good credit score.
  2. Reduce Debt: Keep credit card balances low relative to your credit limits.
  3. Limit New Credit Applications: Too many hard inquiries can negatively impact your score.
  4. Check for Errors: Dispute inaccuracies with the credit bureau.
  5. Maintain Old Accounts: Keeping older accounts open can help improve your credit history length.

 



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