What Does Your Credit Report Mean and How You Can Check It?

All banks, as well as a large number of other private lenders, use an individual’s credit report to decide if he is eligible or not for various types of credit. In many ways, a borrower’s credit report is his financial calling card and contains all the information that lenders need to understand how the individual manages his personal finances and what his spending or borrowing habits are. This having been said, keep in mind that most lenders use this credit report in conjunction with other formulas when deciding if someone will get a loan or not. However, the way in which the credit report is compiled is the same for all people. Here is what you need to know about it:

Who Compiles an Individual’s Credit Report?

Credit reports are compiled by specialised companies that are called CRAs, or Credit Reference Agencies. These gather financial information from all the individuals that use banking services and create these reports. In the UK, the major CRAs are:

  • Equifax;
  • Experian;
  • TransUnion;

It is important to mention the fact that each of these CRAs has its own database, as well as a separate way of compiling the data. This means that each one of them has a different credit file. When checking your credit report, it is recommended to check the files from all three CRAs as there is no way of knowing which one the lender might use.

What Is a Credit Report?

An individual’s credit report is a file that contains a wide variety of personal financial data. This includes:

  • A list of the individual’s bank accounts, including credit and debit cards;
  • Details of other individuals that have had joined financial affairs with the borrower (for example, co-signers and children that may be authorised credit card users);
  • Public record financial information (such as home repossessions, bankruptcies, current debt, and others);
  • An individual’s current account provider;
  • Electoral register details;
  • The name, date of birth, the previous and the current address of the borrower;
  • County Court Judgements and legal charges such as fraud and identity theft;

Who Has Access to an Individual’s Credit Report?

As it is clearly visible from the details mentioned above, an individual’s credit report contains a lot of personal information that should not be disclosed to the public. As a result, there are only a few companies that have access to your detailed credit file. This includes banks, as well as other private lenders that you get loans from, and also landlords and employers. However, the latter two will only see the less sensitive details such as electoral register information, insolvency records and County Court Judgements.

How Can an Individual Check His Credit Report?

The easiest way for anyone to check his credit report is by going to the website of any of the CRAs mentioned above and submitting a request to see the file. One important detail that you must keep in mind is the fact that some CRAs give individuals this access free of charge, while others will require that they pay an access fee. These websites will give you access to the online copy of your file, however, it is also possible to get a written one. This is done by requesting a written copy of your financial report from the Information Commissioners Office.  Regardless of which way you choose, do not forget that every CRA may have a different credit file, which means that you should check all three of them in order to get a better image of how your credit report looks.