Skip nav to main content.
Financial Education

Credit Reports and You

August 5, 2019

What Exactly Is a Credit Report? 

Credit reports may seem confusing, but they’re actually pretty simple.

 

A credit report is a detailed breakdown of your credit history. Credit bureaus collect information about your financial habits, such as how quickly you pay off your cards, or how often you miss payments. They create a report based on that information. When you apply for a loan, lenders use the report to help them make decisions.

In the United States, there are three major credit reporting bureaus: Equifax, Experian, and TransUnion. Each of these reporting companies collect information about you. Although most of the information is similar, there are often small differences between the three reports.

The Big Three

 

1) Equifax

Equifax has been around since 1899, but took a hit to its reputation in 2017 when it suffered a data breach that divulged critical personal information for 143 million consumers.

Equifax has a tool available on its site where you can check to see if you were affected. The company is also offering free credit monitoring to those whose information was breached.

2) Experian

Experian got its start in London when businessmen there began sharing information on customers who did not pay their bills. These businessmen formed the Manchester Guardian Society in 1827, which later evolved into Experian.

3) TransUnion

TransUnion started as a holding company for a tank car company back in 1968. If you’re worried that you’re a victim of identity theft or that you might be, you can place a freeze on your TransUnion credit report. TransUnion will also notify the other two credit bureaus that you’ve done so.

How to make your credit shine:

 

Good credit can make a big difference in your life. The place you live, the loans you take out, and the money you invest can all be affected by your credit. Credit scores include years of past behavior, so it’s important to avoid bad habits. It’s much easier to build a solid credit score than to repair a bad one.

 

Six ways to build and maintain good credit:

 

  • Just starting out with your credit? Open a checking account and keep careful track of your balance.
  • Use debit and credit cards for convenience and safety. Using a credit card even once a month will quickly build your credit score. But try pay it off every month. A growing negative balance, or missed or late payments can lower your score.
  • Maintain a good mix of credit. This boosts your score and demonstrates that you can manage different types of credit.
  • Be extra careful three to six months before a big purchase. Avoid opening or closing accounts or moving large amounts of money around.
  • Build an emergency fund with at least six months of living expenses. If something unexpected happens, you won’t have to go into debt to handle it.
  • Review your credit regularly to correct errors and prevent identity theft. At SeaWest, you can use our online banking platform to access Credit Sense, a free service that lets you easily monitor your credit.

Wondering about other money matters? Ask us a question!

Your question will not be publicly connected with your name or email. We will answer your question but we may not publish your question for others to see. Please give us up to 48 hours to give you the best possible answer.

  • This field is for validation purposes and should be left unchanged.