Why you should check your credit report – and not just your score.
It’s one thing to check your credit score, but it’s a good idea to take the extra step to check your actual report. Your report is a detailed history of your payments and debts. This is different from your score. There are 3 different credit reporting bureaus: Equifax, Experian, and Transunion. By law, you are entitled to one free report from each bureau once per year. You may do this all at once, but I recommend you spread it out through the year (once every 4 months).
Here are the main reasons why you should check your credit report regularly.
Why you should check your credit report – Reason 1: Identity theft protection
Identity thieves are out of control! Last year it was reported that those little weasels stole over 16 BILLION (yep, that’s billions with a B) dollars from nearly 13 million victims. That’s horrific, right?! Often times people have no idea that they’ve been victims of identity theft, as these thieves are rather good at not getting caught. Checking your credit report is a great way to catch any peculiarities and handle them before they spin out of control. You’ll be looking for peculiar charges that are unpaid and large in value. Stay tuned for an upcoming blog series on identity theft and protecting yourself.
Why you should check your credit report – Reason 2: Catch negative items you didn’t know about
If you’re a person that moves often, you could have items that have gotten lost in the mail. This happened to a friend of mine when we were in college. He had a surgical procedure and the hospital sent the bill to the wrong address, oops. He didn’t find out about the bill until a woman from collections called him several months later. That’s exactly why you should check your credit report – so you can find those issues early and get them handled before they hurt your financial goals.
Why you should check your credit report – Reason 3: Correct costly mistakes
Sometimes you will have paid something off and it was not updated on your credit report. Sometimes other people’s stuff is on your report. This also happened to another friend of mine – someone with her exact same name and birthday went to the hospital and didn’t pay the bill. But this doppelganger reported an address where my friend had never lived, so she was able to easily dispute it and get it removed. Another solid reason why you should check your credit report is to spot these errors before they drag down your score.
How to check your credit report (for free)
So, how do you check your credit report? The one that I use is called Annual Credit Report. According to the Federal Trade Commission (FTC), this is the only website authorized to give out free credit reports by the 3 bureaus. There are other sites, but I haven’t used them so I can’t give you any opinion on those.
Also, heed this warning from the FTC website: “Annualcreditreport.com and the nationwide credit reporting companies will not send you an email asking for your personal information. If you get an email, see a pop-up ad, or get a phone call from someone claiming to be from annualcreditreport.com or any of the three nationwide credit reporting companies, do not reply or click on any link in the message. It’s probably a scam. Forward any such email to the FTC at spam@uce.gov.”
This is just for the report, which is actually free. I promise! If you want your credit score from that bureau generated you can pay a few bucks for that information. We’ll talk more about credit scores and how to get that information at another time. For now, check out your credit report if you haven’t in a while and see how things are going. Hopefully everything is just dandy! You also should get your FICO score from time to time to time, I’ve written an article on how to do that.
Did you try checking your report? How did it go – did you learn anything new? Comment or Tweet me, I’d love to hear how your adventure went!