What Should I Look for on My Credit Report?

Consumers are entitled to one free credit report from each credit bureau each year through the Annual Credit Report website. You also might be entitled to a free report if you have been denied credit, are unemployed or are on welfare. It is your responsibility to ensure that your credit report is accurate. When you get your credit report, focus on a few major areas.

Identity Theft

Viewing your credit report is one of the best ways to discover credit-related identity theft. If someone opened an account in your name with your Social Security number, that account will appear on your credit report. Review your report and ensure that each listed account belongs to you. In addition, look at the section that lists credit inquiries made in response to an application for credit and ensure that you initiated each of those. If you find an account that does not belong to you, place a fraud alert on your report through the credit bureau, contact the creditor to close the account, file a complaint with the Federal Trade Commission and file a local police report. Also file a dispute with the credit bureau through the bureau's website or phone number listed on the credit report.

Missing Accounts

If your credit file does not contain all of your credit accounts, your score might not be as high as it could be. The creditor might be reporting the account information inaccurately or you might have opened the account under a nickname, which caused it to not appear on your report. If one of your credit accounts does not appear anywhere on the report, contact the creditor and ensure that the name and Social Security number they have on file for you both match that of your credit report. Ask the creditor to send an updated account history to the credit bureaus.

Incorrect Reporting

Creditors sometimes report inaccurate information to the credit bureaus. For example, a creditor might mistakenly report that your account had a payment that was 30 days late when you actually paid it on time. Or the creditor might have an incorrect date listed for when the account was opened, causing your credit history to look much shorter than it actually is. If you find inaccurate negative information, file a dispute with the credit bureau. The bureau will investigate the dispute and correct the error.

Utilization Ratio

Your credit report lists the credit limit and most recent account balances for all of your credit card accounts. With this information all in one place, you can easily calculate your utilization ratios. To find the utilization ratio on a credit card, divide your most recent account balance by your credit limit. This shows the percent of your credit that you use. Improve your credit score by paying down your balance so you use no more than 30 percent of your credit on each card.