Five Reasons for Ordering Your Free Credit Report

You've seen ads promising a free annual credit report; they typically require a paid subscription to a credit monitoring service. You can also exercise your legal entitlement to one free annual credit report from each of the three major credit bureaus. Why is it important to review your credit reports?

Managing Debt and Credit Repair

If you have bad credit, it's important to review your credit reports for establishing a starting point. It's also worthwhile to pay the additional fees for your credit scores. Order one credit report and score from each credit bureau (Equifax, Experian, and TransUnion) here. Here's how your credit report can help you improve bad credit:

• Establishing the accuracy of your credit history: Due to the volume of information processed by credit bureaus, errors do occur. Inaccuracies may affect your credit score if your credit is confused with someone else with a similar name. Review all information on each credit report to verify the accuracy of your personal information, credit accounts, and public and legal records.


• Comparing account records: Credit reports may not reflect current account information. They may show account balances that are 30 to 60 days old. It's important to compare lender names, account numbers, and credit limits to your records. Due to mergers and transfers of financial institutions and loans accounts, it's not unusual to find different lender names, but all other information including account number, credit line, and approximate account balance should match your records.


• Tracking credit repair progress: Massive amounts of debt don't disappear overnight. If you're repaying debt over time, ordering a credit report every few months can help in verifying your progress and encouraging you to continue your credit repair efforts. Seeing your account balances decrease while your credit scores increase is a strong incentive for managing debt!

Reviewing credit reports can also help guard against crime that can compromise your credit:

Protecting Your Credit

If someone opens an account using your identity, or makes unauthorized charges on your accounts, your credit can be damaged. Fraudulent charges can be removed from your account, and your credit restored, but this takes time and can be a stressful process. Prevent identity theft and fraud by reviewing your credit report:

• Checking personal information: Credit reports show information including current and past addresses, and employment information. Review this information carefully for any errors or information you don't recognize. Inaccuracies can be a sign of identity theft, or that information for someone sharing your name has been erroneously included in your credit report.


• Questioning suspicious account information: If you find credit accounts or loans that you didn't open, this is a five-star alert for fraud or identity theft. Unfortunately, family members can also engage in fraud by opening accounts using the identity of a creditworthy relative. Unfamiliar accounts and high account balances deserve your immediate attention.

Ordering a free annual credit report and occasionally purchasing credit reports and scores can help with managing debt and preventing credit problems.

Sources:

• AnnualCreditReport
• TC: Building a Better Credit Report

About the Author:
Karen Lawson started writing stories about birds and surfing at an early age. For more than ten years, she enjoyed a productive corporate career in mortgage banking before moving to Reno, Nevada in 1997. Karen earned BA and MA degrees in English (specializing in writing) at the University of Nevada. Significant areas of research and writing include truth and ethics in creative nonfiction, medical humanities, and the symbolism and lore of birds in American literature and culture. Karen has taught English at a community college, is writing a collection of poetry, and enjoys birdwatching and walking her basset hounds.