Personal Finance – Who Uses Your Credit Report?

For an employer, your credit report is a tool to predict whether you’ll be a reliable and trustworthy employee. For a landlord, your credit report is a tool to determine whether you’re likely to pay the rent on time or at all. For you, your credit report is a tool to help you understand how you’ve handled your finances in the past and how you’re likely to handle them in the future.Many different types of people can look at this information and make an increasing number of significant decisions that can affect your life. For this reason, double-checking this information is essential. Establishing a positive credit history as soon as possible can help with jobs, insurance, and more.Whether you’re new to the world of credit or you’re an experienced borrower, you need to keep a few key concepts in mind as you look over your credit report. Like the person who can’t see the forest because there are too many trees in the way, when you get your hands on your credit report, you may be blinded by the amount of information.You aren’t perfect. (We hate to have to be the ones to tell you this, but if you aren’t married, someone has to!) The same goes for your credit report and lack of perfection isn’t a big deal, as long as your credit report shows more smooth patches than bumps.No matter how early you mail off that bill payment, it can still arrive late or get lost, which means you can expect to find some negative information on your credit report from time to time. The good news is that you can still be eligible for plenty of loans at competitive rates and terms without having a flawless credit report or qualifying for credit sainthood.But how many bad marks are okay? How long do they stay? And how will lenders who view your report interpret them? For example, say you’re a well heeled, easy going gal and you loan your boyfriend £5,000 for a very worthy cause. He promises to pay you back monthly over two years.But after four months without a payment, two things likely will happen: He’ll no longer be your sweetie, and you’ll have mentally written off any chance of collecting the debt. Plus, if you’re smart, you’ll think twice before lending money to a friend again. You may even mention the negative experience to your friends, especially if they were thinking of floating him a loan.If you were to run into your ex-boyfriend sometime down the road, you’d probably mention the £5,000 after all, you want your money back, and he still owes you. Whether you’d ask him to join you for dinner is another matter and may depend on his showing you some good faith gesture.