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Reading a Credit Report for Beginners

How Do You Read a Credit Report?
Susan Guillory
Susan GuilloryUpdated August 6, 2022
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A credit report is a detailed summary of how you have handled your credit accounts. Like a report card on your borrowing and payment habits, credit reports are used by potential lenders and creditors to help them decide whether to offer you credit or a loan — and at what terms. That’s why it’s so important to periodically check your credit reports (you have three) and make sure all of the information is accurate and complete. Learning how to read your credit reports also allows you to get a better understanding of your overall financial picture. You may see places where you can improve and find ways to improve your credit profile. This is particularly important if you are thinking about applying for a loan or credit card in the future.If you’re new to credit reports and are looking for a no-frills guide, you’re in the right place. Below, we walk you through how to read your credit report and what to look (and look out) for as you do.

Getting Your Credit Report 

A credit report displays all your credit accounts, including credit cards, personal loans, auto loans, and mortgages in one place. It also includes payment activity, balances, and inquiries from lenders and creditors. Credit reports are generated from each of the three personal credit bureaus: Experian, TransUnion, and Equifax.Typically, you’re entitled to one free credit report from each credit bureau per year. However, due to financial difficulties caused by the COVID-19 pandemic, the three credit reporting agencies have made free reports available every week and will do so until the end of 2022. To request copies of your credit reports, simply visit If you want constant access to your credit report, as well as a credit monitoring service, the three credit bureaus also offer paid monthly subscriptions.Keep in mind that you won’t find your credit scores in your credit reports. While your credit scores are important, and are based on information found in a credit report, they aren’t a part of the reports. However, you may be able to get your credit scores for free from your bank or credit card issuer.

Reading a Credit Report

The three credit bureaus all operate independently, so their reports may look slightly different. However, they generally cover the same information, which typically includes:
  • Personal information This is where you’ll find your name (including former names), your Social Security number, and birth date. Your report will also include current and previous addresses and contact information like phone numbers and email addresses. Your employment history may also be in this section.
  • Personal Statements This section will typically include any statements you’ve submitted to a credit bureau. For example, if you disputed an item on your report and the investigation did not resolve the dispute, your statement might explain how you disagree with reported information.
  • Negative Items (if any) This area will include a list of accounts that haven't been paid as agreed. It will also include any collections and public records (such as bankruptcies). 
  • Accounts This is the meat of your credit report and where you’ll find details on all of your accounts, which could include mortgages, student loans, personal loans, car loans, lines of credit, and other types of credit accounts. This section will show the status of your accounts (e.g., open or closed), your payment history, current account balances, and loan payment status.
  • Credit Inquiries This is where you’ll see any times when someone checked your credit. Inquiries typically occur when you apply for a new credit card or loan. They can also occur if you apply to rent a home or apply for a new job. 

What Should I Check for When I Read My Credit Report? 

Regularly reading your credit reports allows you to check for errors that might be lowering your credit scores. It can also tip you off to potential identity theft. You can use the dispute process to get mistakes removed, which may help you qualify for credit or get better terms.Here are some key things to look for as you read your credit report:

Personal Information 

Make sure all the information in this section is accurate. A misspelled name, a mistake in your Social, or an address you don’t recognize could mean your credit report has been confused with someone else who happens to share your name.

Soft and Hard Credit Inquiries 

An inquiry happens when you apply for credit or an account like a cell phone plan or utility service. A soft inquiry, such as seeing if you’re prequalified for a credit card, does not impact your credit score. A hard inquiry, like applying for a loan, may impact your score for a short period of time.Make sure that all hard inquiries were authorized by you and they fall off your report after two years. An inquiry (soft or hard) from a person or company you don’t recognize could be a sign that someone is trying to open accounts in your name.Recommended: How Often Does Your Credit Score Update?

Credit Amounts 

For revolving credit vs. installment loans, this will indicate the current credit limit on the account. If the account is an installment loan, this will show the original amount of the loan. Make sure this information is right. If the credit limit listed is lower than the one you actually have, it may hurt your credit utilization (how much of your available credit you are using), which impacts your credit score. Recommended: Effects Personal Loans Have on Your Credit Scores

The Status of Your Accounts 

Some of your accounts listed on your credit report will appear as open, and others closed. Other statuses you may see include: transferred, charged off, refinanced, or foreclosed. It’s important to carefully review this to ensure this information is accurate. Incorrect information on your credit report is, unfortunately, one of the reasons your credit score will drop

Opening and Closing Date of Your Accounts 

Look to make sure the dates listed for the opening and closing of each account you have are correct. If you notice an older credit card account you rarely use that is still open, however, don’t feel that you have to rush to close it. Closing a credit card account can negatively affect your scores. That’s because you lose the available credit limit on that account, which can cause your credit utilization to go up. Instead you may want to keep the account active by making small charges and paying the card off in full each month. 

Creditors’ Information 

Your credit report will also list information about your creditors. This information is usually just the name of the creditor or lender. In some cases, the name may not match the name of your credit card or account statement. If that’s the case, you can use other details, such as the account opening day and original amount or limit to identify the account.

Payment History 

One of the biggest things that affect your credit score is your payment history. Your credit report will show whether you’ve paid your bills on time or if you have had a few (or more than a few) late payments. Since this is such an important factor in determining your credit score,  you’ll want to spend time carefully checking for any inaccuracies in this section of the report.

Public Records 

There will be a section on your credit report for public records. This includes:
  • Bankruptcies
  • Foreclosures
  • Tax liens
  • Civil judgments
  • Repossession
Ideally, you want this section to be blank. These negative marks stay on your credit report for seven years, although Chapter 7 bankruptcy will remain for 10 years. Some creditors won’t lend to someone who has any of these on their report.While it’s rare for there to be mistakes in this section, it’s still worth scanning. If you do find a mistake, you’ll want to clear it up as soon as possible.

History of Employment 

Your credit report will display your current and previous employers. Often, employer history is included in the personal information section. This is only listed to help verify your identity and does not have any impact on your credit. However, if you see any information you don’t recognize, you’ll want to follow up on it right away, since this can be a sign of identity theft.

Reading the Codes on a Credit Report 

You may notice a variety of different codes in your credit reports. To make matters even more confusing, each credit bureau uses its own set of codes. Fortunately, you can find out what these codes mean for each of the three credit bureaus in these guides:

The Meaning of “U” on a Credit Report 

If you see a “U” on your credit report, it stands for “unclassified.” This means that the account had not been updated when the credit report was generated. You might see a “U” on an account if it’s newly opened and you haven’t made any payments yet. “U” marks are neutral and not looked at as positive or negative by lenders. However, a “U” can also indicate a problem with the account, like it being past due or sent to collections. If an account is labeled “U” and it isn’t new, you’ll want to follow up with the creditor to find out why.

Disputing Credit Reports 

If, in reading your credit reports, you find information that isn’t correct, you’ll want to file a dispute claim with the appropriate credit bureau as soon as possible. You can easily do this online. Here are the links for disputing a credit report error:In some cases, you may also need to send documents and any evidence you have to prove there is a mistake via certified mail.

How Credit Reports Are Used

You’re not the only one looking at your credit report. Here are some situations where lenders and other companies may check out your credit reports.


Whether you apply for a mortgage, auto loan, or personal loan, the lender may access your credit reports to view your financial activity. Lenders will typically use information from your credit report to determine how much credit to extend you and what interest rate to charge.

Renting a Home

If you’re applying to rent an apartment or house, the landlord may access your credit reports in order to determine whether or not you will be a reliable tenant who is likely to pay the rent on time and in full each month.

Other Services

Other services, including utilities, cable and cell phone providers, and insurance companies, may check your credit reports and use the information to determine if you will be a reliable customer.

Personal Loans 

If you’re thinking about taking out a personal loan in the near (or distant) future, checking your credit reports (and checking your credit score) is a great first step. This allows you to see exactly what a lender will see when you apply and gives you an opportunity to correct any errors and, if necessary, work on building your credit profile.    If you’re curious about what rates and terms you might qualify for right now, Lantern by SoFi can help. With our easy online lending tool you can review and compare personal loan offers from multiple lenders.

Frequently Asked Questions

How can you read a credit report?
What should you look for when reading a credit report?
How can you read the codes on a credit report?
Photo credit: iStock/ijeab

About the Author

Susan Guillory

Susan Guillory

Su Guillory is a freelance business writer and expat coach. She’s written several business books and has been published on sites including Forbes, AllBusiness, and SoFi. She writes about business and personal credit, financial strategies, loans, and credit cards.
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