The things your credit report reveals about you can determine if you're eligible for financing. Whether you're applying for a credit card, an auto loan or a mortgage loan, the lender will check your credit report and base approval on your credit history. If you're tired of credit rejections, here are seven things your credit report reveals about you.
What are the things your credit report reveals about you? To start with, if there’s a loan or credit card in your name, creditors report your account balances to the bureaus. Anyone who checks your credit report can see how much you owe and reach conclusions regarding your spending habits. Too much debt can stop future loan and credit card approvals. To keep your credit history in tip top shape, keep balances to a minimum.
Your credit report is a collection of your complete credit history. It includes the date of your first opened account, as well as the date of your most recent accounts. Any creditor checking your credit report can quickly assess the length of your credit history by looking at the date on each of your accounts. This information is crucial because some creditors are hesitant to extend financing to people with a short credit history.
When applying for a new credit card or loan, the creditor will check your credit history to determine your payment record. Payments that are 30 days past due are reported to the credit bureaus. This information remains on your credit report for seven years, and if you habitually send payments late, future creditors may not approve your application.
Maybe you filed bankruptcy in the past, but took steps to repair your credit rating. This is commendable. Understand, however, a bankruptcy stays on your credit report for up to 10 years. Even if you rebuild your history and maintain A+ credit after a bankruptcy, some banks will deny your application or require a cosigner because of your past mistakes.
Did you cosign for a friend, a child or a sibling? If so, this loan or credit card will appear on your credit report. This information on your credit report raises your overall debt total, and can potentially lower your credit score. In fact, cosigning a loan can stop you from qualifying for your own loan.
Applying for a new credit card isn’t a secret between you and the creditor. Whether you’re approved or denied for the credit card, this inquiry appears on your credit report. Inquiries also appear when you apply for a loan. Although an inquiry seems harmless, applying for new financing reduces your credit score. And if you have too many credit inquiries on your credit report, creditors may see this as an act of desperation.
Again, credit reports are a collection of your complete credit history. With this said, old loans that you’ve paid off appear on your report. This also applies to credit cards that you’ve closed or canceled. This information reveals the number of credit cards and loans you’ve had over the years.
Because the information on your credit report determines whether you qualify for a loan, it’s important that you protect your credit and ensure the accuracy of information. Regularly check your report for errors and report mistakes to the bureaus. What steps have you taken to keep your credit report in good condition?