Understanding Your Credit Report
A credit report has a high level of personal information that is organized according to the following information:
- The first section included is your personal information like your place of residence.
- All inquiries on your credit report appear in this section. If you have applied for a credit card, any type of loan or have opened a new account at a bank, this will appear here.
- All of the employers you have worked for are included in the third section. The three most recent employers are stated in this section.
- A person’s credit history related to any collections issues,payment defaults, judgments, write offs, bankruptcies,foreclosures and any liens will be listed in the fourth section. Lateness of payment of any utility bills may also appear in this segment.
- Many people have trade lines. This part of the report contains information regarding the amount owed to each creditor and who the creditor is, the amount of the line of credit, terms on repayment of the debt as well as the credit rating.
- Codes used on credit reports:
- R is related to credit card balances and I is related to loan balances.
- Codes R1 and I1 mean the account is current with no past due amounts.
- Codes R2 and I2 specify an account is 60 days past due.
- Codes R3 and I3 state the debtor is is 90 or more days over due.
- Codes R4 and I4 indicate the debtor is more 120 days in default of a payment.
- Codes R5 and I5 show an individual is 150 or more days late in sending payment.
- Codes R7 and I7 indicate a person is seeking the aid of a credit and debt counselor.
- Codes R8 and I8 means the individual has experienced a repossession of the item the loan was for.
- Codes R9 and I9 indicate the debt was not repaid and was written off as an uncollectable debt.
When a person pays off an account that is seriously past due, the credit rating will be enhanced to R1 or I1 status. If the lowest level is reached, a person’s credit report will have the information on for seven years under the R9 and I9 level even if the debt is paid in full.