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The influence your credit report has on your life

By Janet Lacey
Published: Friday, October 23rd, 2009

What exactly is a credit report? A credit report holds information regarding all your financial transactions. It mostly deals with credits, including all the credits you have ever had. These might include credit cards, any loans you might have taken, student loans or mortgages. It has information regarding your payments to these different credits and how regular or irregular you were in paying them back.

A credit basically means you are borrowing some one else’s money to pay for the goods and series you are buying. Thus, it is natural for the creditor to want to check up on you. He wants to know how regular and consistent you have been in your payments in the past. He requests for your credit report. The credit report is provided by three different agencies in the United States. These agencies are TransUnion, Experian and Equifax. These agencies are also legally bound to provide you with a free report each every year. It is advised that you should make use of this facility. Get your reports regularly and keep a tab on your finances. The creditor goes through your financial background and makes a decision regarding the credit you have requested for. The credit report, therefore, holds the key to whether you are eligible for the credit or not.

Credit report plays a major role in your life and it is advisable to ensure you have a good credit. Credit information is provided to these agencies by different institutions including banks, tax agencies and post offices. The information is sent regularly, usually once a month. Therefore, this report is up to date and accurate. People might assume that they do not have any credits until they reach a certain age, begin to earn and spend big. However, people have credit reports from young ages. Youngsters, nowadays, have credit cards from a young age. You will have a credit report even if you have a store card. Planning you finances should begin from a young age. A student loan might be rejected or the interest rates could turn out to be too expensive due to your mismanagement early on. You might not be able to get the perfect home in your dream locality due to your bad credit report. The mortgage application might be rejected or again the interest rates might be too high. Renting or leasing a house will be affected by a bad credit report as well. The houses in good localities are more expensive and you might not get a good house in the right locality. Bad credit history, therefore, translates into a lot of problems. You will not be able to get your hands on any of the credit you wish due to a bad credit report. However, many times there might be some problem or mistakes on the credit reports. Order credit reports regularly and keep a tab on your credit history. Monitor it closely and in case of a mistake or a negative entry that you do not agree with, raise a dispute immediately and the agency will investigate. You do not want to pay for their mistake.

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