With how much importance credit reports play in everyday life, it is amazing to find out that many people fail to know or even care to know what is on their report.  Often times people are simply confused or scared to check their credit reports.  The article below explains more about how to read or interpret credit reports; here we will look at the importance of credit reports.

Credit reports are an essential part to how people qualify for loans.  Every lending institution must see credit reports when determining your loan rate, or if you even qualify at all.  The rate on your loan can vary by more the ten percentage points depending on where your credit reports say your FICO score is.  It is very important to be familiar with you credit score prior to going into applying for loans.  You may see that a few more points on your score could dramatically change the interest rate of the loan.  There may then be ways to take steps, like paying off some credit card balances, to raise your credit score and get a better rate on the loan. 

There are three credit bureaus that independently grade and judge where your credit stands.  Often times credit reports will have FICO scores from all three of them, sometimes it will be just one.  In addition to the score you will see you current open credit line limits, along with balances.  For information on improving your credit score along with other tips for making the credit reports better for loan qualification, you should contact a credit counselor. 

You should take some time to review you r credit report, and see what credit reporting tool is best for you.  Remember, credit reports are an important part in all of your financial goals.  Make sure to review all the information showing up on your credit report.  If anything is wrong or doesn't seem right contact the proper bureau to dispute the claim.