Why and How to Check your Credit Report

 

What is a credit report?


A credit report is a document showing your financial activity. They're written by credit bureaus, who collect and store information about you that is reported to them by creditors, like a bank who gives you a loan or a company that issues you a credit card.

Credit reports also show where you work and live, and whether you've been sued, arrested, or filed for bankruptcy.

There are three major credit bureaus who collect this information: Equifax, Experian and TransUnion. Since creditors aren't required to give info to all three, there might be differences between the reports.


Why should I bother checking it?


Checking your credit report is part of the first step to tackling your student loans: all your student loans will show up there, so you can track down any stragglers that got away from you.

You should also check your credit report once a year to make sure nobody has taken out credit cards or loans in your name.

It breaks my heart, but I hear stories all the time about people whose parents are hard-up for money, so they steal their children's identity to take out a loan. They think that they will pay it back in time and no one will notice, but sometimes it gets away from them and the child ends up in financial ruin. Either way, it's illegal. Checking your credit report can help you put a stop to that sort of thing before it becomes a bigger mess.

Also, sometimes someone from a reporting company or bank makes a mistake and incorrect information goes on the report. If you've got the same name as a family member, (e.g, John Doe Jr. and John Doe Sr.) the likelihood of this goes way up. Don't wait until you're rejected for a mortgage or a job to catch this sort of tomfoolery.

You Get One Free Report Each Year 

 

You are entitled to a free credit report from each of the three credit reporting agencies once every 12 months. You can check it more often, but they can charge you. Once a year is prudent enough for most people.

You can request all three reports at once, or space them out throughout the year.

Everybody everywhere gets one free credit report each year. But what if you need another one?

Under federal law, you’re entitled to another free report if:
  • A company takes adverse action against you, such as denying your application for credit, insurance, or employment, and
  • You ask for your report within 60 days of receiving notice of the action. 
The notice will give you the name, address, and phone number of the credit reporting company.

You’re also entitled to one free report a year if you’re:

  • Unemployed and plan to look for a job within 60 days;
  • On welfare; or 
  • If your report is inaccurate because of fraud, including identity theft.

Otherwise, a credit reporting company may charge you a reasonable amount for another copy of your report within a 12-month period.

 

How to get your credit report


Online: Visit AnnualCreditReport.com

By Phone: 1-877-322-8228

By Mail: Complete the Annual Credit Report Request Form and mail it to:

Annual Credit Report Request Service
PO Box 105281
Atlanta, GA 30348-5281



 

Beware of Fake Credit Report Scams


Ads for free credit reports are everywhere, but other than the official channels above, stay away from anyone offering you a free credit report.

Some of them are relatively benign: They'll give you a "30 day free trial" so that you can look at your credit report all day long. Then they'll start charging you a monthly fee to view your credit report. These things are hell to cancel, and they're that way on purpose.

Others are outright scams, trying to get you to fill in your social security number and other information so that they can steal your identity.

Stick to the official channels, or deal with the three bureaus directly if you need to buy a second report from them:


Sources:
https://www.usa.gov/credit-reports
https://www.consumerfinance.gov/askcfpb/309/what-is-a-credit-report.html
https://www.consumer.ftc.gov/articles/0155-free-credit-reports

All sources used for this article are official websites of the US government

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