Approximately one-third of the population doesn’t check their credit reports every year. Almost one-fourth have never checked them at all. Not checking your credit report on a periodic basis puts you at a lot of risk. The good news is that checking your credit reports is a very simple thing to do.
A government study shows that about 40 million Americans have mistakes on their credit reports. These mistakes can vary and include things like a misspelled name, wrong addresses, accounts that don’t belong to you, incorrect late payments, etc. Some of these mistakes can have a very damaging affect on your credit score. Some could even mean you’ve been a victim of identity theft.
There are several ways to stay on top of your credit report. Signing up for a monitoring service is one. All three Bureaus, Experian, Trans Union and Equifax offer such a service. You can also check with any existing credit cards you have as some of them offer monitoring services as well. Or you can simply check your report yourself since monitoring services usually have a monthly fee. Once a year you are entitled to a free credit report from each bureau. To receive these you simply need to go to www.annualcreditreport.com. You will have immediate access to your reports and if you do find mistakes you can dispute them right then without having to go through a “snail mail” process. It will give you the option of also seeing your credit scores, for a small fee. Just remember these are personal scores and are always going to be higher than any other scoring models, like your mortgage or auto scores. The personal score is not used by any industry for any reason so purchasing them is really not necessary because in the real world they mean very little.
Since you can only get a free credit report once a year, a smart way to do this is to split up when you order them. For example in January order a copy of your Experian report. Then wait a few more months and order Equifax, then a few more months and order Trans Union. Even though each bureau can have different information, by ordering them separately throughout the year you can have a pretty safe grasp of what is on your credit files.
Once you have them you need to scrutinize them very closely. Check everything! A good list to follow is:
- Names – all variations and spellings
- Addresses – be sure they are all places you have lived
- All accounts and open dates – be sure you recognize all the accounts
- Any negative items
- Inquiries – be sure that they are inquiries you actually made
- Credit limits on credit cards (especially since inaccurately reported limits can have an adverse affect on your credit scores if those cards have high balances)
- Public records
If you find any inaccuracies in any of these areas it is imperative that you try to get them corrected as quickly as possible. By going through annualcreditreport.com you can easily dispute any information and will get results a lot faster.
In our busy lives all this may seem like an inconvenience and something you just don’t have time to do. Make the time. It could mean the world of difference if mistakes you are unaware of cause you to not be able to qualify for a mortgage, auto, or credit card at some point.
Provided by Mindy Leisure, Rescore Express Manager, Advantage Credit Inc.
Mindy has over 30 years experience in the real estate, property management and mortgage industry. She has previously worked as a loan officer and processor. For the last 24 years she has worked exclusively in the mortgage industry writing articles and giving seminars to brokers, home buyers and realtors educating them on credit scoring and enhancing credit profiles. Mindy is FICO Pro Certified and has been interviewed by several national magazines and newspapers as an expert in the area of credit.
