A credit report is a detailed written account of a consumer’s credit history, as prepared by a credit bureau – using financial information collected from creditors. This information includes a consumer’s identifying information (current and previous addresses, Social Security number, and employment history) as well as their history of loans, credit cards, bills, accounts, payments, bankruptcies, and credit searches.
Lenders use credit reports to determine each loan applicant’s creditworthiness. In order to obtain these reports, lenders are required to follow the procedures laid out in the Fair Credit Reporting Act. The Fair Credit Reporting Act requires that each of the three credit report bureaus (Equifax, Experian, or TransUnion) must supply consumers with a free credit report once a year. The Act also entitles consumers who are on welfare, unemployed (and seeking employment), victims of identity theft, or subjects of adverse action (such as denial of credit, insurance, or employment) to a free credit report from each of the reporting agencies.
[Last updated in August of 2021 by the Wex Definitions Team]