A few years ago, the government passed a law that allows you to check your credit report free once a year from all three credit bureaus. Not only is that wise financial management, but it’s essential for maintaining and protecting your identity.
To access your report for free, go to www.annualcreditreport.com and follow the onscreen instructions. You’ll need to answer a series of questions designed to verify your identity. The credit report itself lists all the information that particular credit bureau has on you with the exception of your credit score. If you want the credit score, that costs extra, but the truth is that you don’t need to know your credit score. If the report looks good and healthy, your score is going to be just fine.
While you are viewing your report, you should verify the status of each of your accounts. If something is amiss, you can (and should) dispute that information immediately. By law, the credit bureaus have 30 days to either fix or remove that particular information. In certain cases, you may have to bring the issue up with the account provider if the issue keeps appearing on your report. You should also verify that your accounts are really yours.
According to Dave Ramsey, upwards of 78% of all credit reports have inaccurate information on them, and that can negatively affect you. In my latest review, I discovered that my account was associated with an incorrect Social Security Number. The incorrect number is exactly one digit off, and my guess is that somewhere in the past, my SSN was incorrectly entered somewhere and now it’s associated with my credit report. Not a big deal right now, but that’s still something that should be removed.
To remind me to check my report, I set up a notice in my e-mail program that notifies me once every four months to go check my credit report. Because I get one free report per year per credit bureau, I can access a credit report every four months. This is the simplest way to consistently monitor your credit, and it’s free.
A few last tidbits on credit reports:
- An account will stay on your report for seven years from the date of last activity. The only exception is a Chapter 11 Bankruptcy, which stays on for ten. Remember, it’s not seven years from the time the account is opened or closed, but seven years from the date of last activity.
- If there is an error, it is your job to get it taken care of. The account issuers have no vested interest in your credit report and the credit bureaus merely store the information they are given.
- Because credit companies regularly review your report, an error or negative report on any one account can affect all of your accounts.
- Credit Repair companies are scams. You cannot legally repair your credit except by paying on time and paying down debt. The only information that can legally be removed from your credit is incorrect information.
- Places like FreeCreditReport.com are not free. Go to www.annualcreditreport.com to access the government-mandated free credit reports.
- If you’re married, don’t forget to check your spouses report. Your credit report is an individual report for you and only you.
In conjunction with the free credit report, take the time to Opt Out of pre-screened credit offers. Not only will you reduce your risk of identity theft and credit fraud, you’ll do your part to eliminate one of the single greatest contributions to junk mail in America.