A credit report reveals if you can pay back a loan in a timely fashion. Thus, it is important to examine it regularly to keep away errors.
It is well established that your Credit Score plays a large part in proving your credit worthiness while applying for a loan. It is a three-digit numerical representation of your credit history derived from the information contained in your credit report.
Your credit report, in turn, is a summary of your loan and Credit Card usage history. It reveals whether you can pay back a loan in a timely fashion. It is wise to examine your credit report periodically to gauge your credit worthiness, and fix errors if any.
One of the foremost things you will spot on your credit report is the demographic and identification data. It is details like your name, date of birth, address, PAN information and your contact details.
Make sure all of these fields contain the correct data. In case of any discrepancy, get in touch with your credit bureau/financial institution to correct them immediately. An error in your report can interfere with a loan or Credit Card application in the future.
Loan and Credit Card Information
Your credit report also contains details on all loans you have ever taken. In this regard, the information will include the names of the lenders, nature of the loan, date of disbursal, the total loan amount, current outstanding, interest rate, time period and the current status. It will also have a rolling 36-month history on your repayment record. Late and overdue payments are also listed. It is up to you to make sure that these fields are completely accurate.
A credit enquiry is when financial institution enquires your Credit Score to take a decision on your application. Too many enquiries without a corresponding approval or disbursal of a loan or a Credit Card signify that you are ‘credit hungry’. It also negatively impacts your Credit Score. It is therefore advised that you identify the financial product you need with reasonable precision, and steer clear of making too many applications.
A credit report is an important tool for you to keep a tab on. Remember – the more impressive your credit report, the higher your Credit Score will be. You can get a free copy of your credit report on BankBazaar.com here.